On January 31, 2014, a California Appellate Court reversed an employer’s summary judgment despite well documented evidence of the employee’s history of poor performance.  This decision—Cheal v. El Camino Hospital (No. HO36548)—addresses a pivotal question for employers: when can employers legitimately terminate a protected employee because of poor performance?

At the age of 61, Plaintiff Carol Cheal (“Plaintiff”) was terminated from her job as a Dietetic Technician Registered from Defendant El Camino Hospital (“Defendant”). In this position, Plaintiff was primarily responsible for preparing menus for hospital patients.  Between January and September 2008, Plaintiff’s supervisor provided her with multiple written warnings, including a final warning for her failure to adhere to hospital procedures that ensure correct foods reach the correct patients.  Ultimately, Defendant terminated Plaintiff on October 10, 2008 because it determined she was no longer competent to perform her duties.

Plaintiff later filed a lawsuit asserting, among other things, age discrimination.  Defendant’s Summary Judgment Motion was granted by the trial court because Plaintiff failed to show that she could perform her job in a satisfactory manner.  Subsequently, a California Appellate Court reversed Defendant’s Summary Judgment.  In doing so, the Court analyzed the following elusive question: what constitutes satisfactory employee performance?  While the Court stated that an employer is free to set standards and discipline an employee that might appear unreasonable to outside observers, the Court cautioned that an employer’s standards and discipline must be applied evenhandedly.  The Court reasoned that because Defendant’s policies actually allowed for mistakes, and because similarly situated employees also made mistakes without the consequence of termination, there was a triable issue as to whether Plaintiff performed her job in a satisfactory manner.  As such, Defendant could not defeat Plaintiff’s case on summary judgment.

For employers, the Cheal case presents two practical takeaways.  First, employers must enforce their policies evenly among all employees.  If one employee is treated more harshly than others, this unequal treatment may later be used as evidence of a discriminatory animus.  Second, employers should review their policies to make sure they clearly delineate what constitutes adequate job performance.  In Cheal, Defendant’s policy allowed its employee’s to make a certain number mistakes, which according to the Court, defeated Defendant’s argument that Plaintiff was unable to competently perform her job duties.