$9.45 Million Reasons Not To Disclose Terminations

Most employers know that terminations should not be publicized externally or internally except to those who have a legitimate need to know the information.  On April 30th a federal jury in Kentucky reinforced this rule when it found that Charter Communications must pay over $9.45 million for defaming seven former employees by telling other employees about the incident that lead to their firing.

In October 2013 Charter fired seven employees for taking printers purchased by the company to their homes.  The former employees claimed they had permission to take and keep the printers.  The former employees alleged that a month after their firing a Charter Human Resources Manager gave a PowerPoint Presentation in which he referred to the incident as “Printer-gate.”  They also alleged that the PowerPoint mentioned “Printer-gate” with one incident in which an employee allegedly used a company credit card to make personal purchases and another incident in which former employees allegedly sold illegal drugs on Charter property.  The former employees contended that the use of the term “Printer-gate”, particularly in conjunction with references to employee theft and drug dealing, implied that the employees had engaged in criminal conduct.

The jury agreed with the former employees.  The jury was particularly bothered by the company’s actions, since it awarded each former employee $1,000,000 in punitive damages.  Punitive damages are designed to punish a defendant for its wrongful conduct.  The jury also awarded each plaintiff an additional $350,000 for embarrassment, humiliation and mental anguish.

This case serves as a reminder that when you terminate an employee you should not disclose the details to anyone who does not have a legitimate need to know the information.  And those that have a legitimate need to know the information are a small group.  The failure to follow this rule could result in expensive litigation and, in a worst case scenario, you writing the employee a large check in settlement or to pay a jury’s verdict.

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