Opinion ID: 2977192
Heading Depth: 3
Heading Rank: 1

Heading: Allen’s and Slone’s terminations

Text: Allen was hired by the Hospital in 1977. She worked in various nursing and supervisory positions until her termination. Slone was hired in 1987 to work as a transcriptionist in the radiology department, where she was responsible for filing, typing, and working at the front desk of the department. At the time of their terminations, Allen and Slone were 63 and 53 years old, respectively. Emily Davis, Tammy Davis’s 10-year-old daughter and Allen’s granddaughter, injured her left arm on Wednesday, October 29, 2003. Allen picked up Emily from school and urged Tammy Davis to take the child to the emergency room. Davis complied by taking her daughter to the emergency room at the Hospital, where x-rays were taken of Emily’s arm. She then made an appointment for Emily to see a doctor the following Monday. Although Davis was told to pick up Emily’s x-rays before leaving the Hospital in order to have them for the appointment, she forgot to do so. Having realized that she forgot the x-rays, Davis asked Allen to pick them up while Allen was at work on Friday, even though Davis had not signed a release permitting Allen to obtain the records. The next morning, Allen went to the radiology department in order to retrieve the x-rays. She was told by a member of the radiology department that she could not get a copy of the x-rays without a signed release form. Despite being informed that releasing the x-rays without proper authorization would violate the Health Insurance Portability and Accountability Act of 1996 (HIPAA), a statute protecting patient privacy, Allen continued her efforts to retrieve the films. She was ultimately able to get a copy of the x-rays from Slone. Allen later signed Davis’s name on a release form, backdated the document, and put it in the x-ray jacket. Throughout the course of this litigation, Allen has maintained that her actions did not constitute a “forgery” because she had Davis’s oral permission to sign the release. Davis, however, did not recall whether she had given Allen permission to sign her name, but she did give Allen permission to pick up the x-rays. HHC investigated Allen’s and Slone’s conduct for breach of patient privacy. Harold Warman, the President and CEO of HHC, decided to terminate the plaintiffs based on the recommendation of the Hospital’s Vice President of Human Resources. The Hospital has maintained that Allen’s and Slone’s policy violation constituted a “Group I” offense, the worst category of offenses that an employee can commit, and one that authorizes termination upon the first infraction. Warman, however, could not remember the exact details of the policy and conceded that, in an emergency situation, verbal authorization might be allowed. Other employees also stated that they did not know whether there was a written policy detailing how authorization for the release of No. 07-6414 Allen et al. v. Highlands Hospital Corp. Page 3 medical records was to be obtained, and no written policy of this type appears in the record. But every HHC official involved in the disciplinary process agreed that Allen and Slone had committed a Group I offense and should be terminated. 2. HHC’s cost-cutting strategies and employee-turnover rates Warman became the President and CEO of HHC in 1998. Soon after he arrived at HHC, he implemented a series of measures to cut costs at the Hospital. Mary Jarvis, a budget manager who reported to Warman, testified that these cost-cutting measures included increasing employee turnover, reducing the amount of sick and vacation time used by employees, closing departments, eliminating positions, and using fewer staff members per shift than had previously been required. Jarvis also said that one of Warman’s strategies was to terminate employees based on seniority to facilitate the hiring of new, less costly employees. In fact, Warman increased the annual turnover rate from 2% to 28%. Jarvis did not know whether the cost-cutting measures had a disproportionate effect on older employees, but she said that Warman’s focus was at all times on improving HHC’s financial situation. As the district court noted, the cost-cutting measures implemented by Warman “did not necessarily disproportionately affect” older employees at the Hospital. HHC’s expert presented the following statistics reflecting the change in the Hospital’s workforce from the time that Warman became CEO in 1998 through the end of 2004: Date Total Number of Employees Age 40 Employees Employees and Older Younger than Age 40 July 1998 672 273 399 December 2002 488 253 235 December 2004 530 267 263 The district court summarized this data as follows: [F]rom 1998 to 2004, there was a decrease of 136 employees in the under forty category and a decrease of six employees in the forty or over . . . category. Just under 89% of the 184 employees terminated or leaving HHC from 1998 until 2002 were under forty, and if the longer time period is examined, from 1998 to 2004, just over 95% of employee loss took place within the under forty category. The percentage of those employed within the forty and over class rose from just over 40% to just over 51% and back down to just over 50% from 1998 to 2002 to 2004, respectively.