Seventh Circuit Upholds Verdict in ADA Lawsuit

By Kelly A. Hayden, JD, Chief Legal Counsel
Published October 15, 2024

In a recent opinion, the United States Court of Appeals for the Seventh Circuit (covering Illinois, Indiana, and Wisconsin) upheld a jury verdict against Wal-Mart regarding its termination of an employee with Down syndrome. The verdict includes $150,000 in compensatory damages as well as backpay and other compensation in the amount of $419,662.59. Further, the Court upheld injunctive relief requiring reinstatement and communication with the employee’s guardian in the future. The opinion did reduce a punitive damages award in the amount of $125 million to $150,000 to comply with the damages cap under the Americans with Disabilities Act (ADA).

What happened to warrant this type of verdict? The employee, an individual with Down syndrome, worked at Wal-Mart as a sales associate for more than 15 years, beginning with the store in 1999. She worked from noon to 4:00 p.m. five days per week. The schedule accounted for her inability to drive and to stand for more than four hours, as well as a need for routine because of her disability. The employee received positive performance evaluations during her tenure, although her managers noted that she required a period of adaptation when she was asked to perform a new task.

In November of 2014, corporate headquarters issued a company-wide directive that managers could no longer override computer-generated staff schedules, absent a specific business justification for doing so. The employee was assigned to work 1:00 - 5:30 p.m. by the computer and had a difficult time adjusting to this change. She began leaving early, and/or not showing up, which resulted in disciplinary write-ups. By the time of her termination in July of 2015, the employee had incurred over 17 write-ups for leaving early and/or not showing up at all.

After her termination, the employee’s guardian called her managers and requested that the employee be reinstated with her old schedule due to her disability. While the managers testified that they understood the request to be related to an accommodation under the ADA, they did not grant the request for a variety of reasons, including 1) that she had already been terminated; and 2) other employees had requested schedule changes and were denied. The accommodation was never elevated to human resources, which would have triggered a more formal process of further discussion and potentially, the provision of medical documentation.

The main question before the court was whether the company should have been on notice for the need for an accommodation prior to the employee’s termination. The answer was, unquestionably, yes. The court pointed out that Wal-Mart knew the employee had an intellectual disability and that this made it difficult for her to adapt to change. Further, her attendance difficulties arose after 15 years of positive employment and only after the schedule change, making it obvious that this change was the cause of her attendance infractions.

The Seventh Circuit has previously noted that while an employer is not normally required to ask employees if they need accommodations, “if an employee with a known disability is having difficulty performing his or her job, an employer may inquire whether the employee is in need of a reasonable accommodation.” The Court further opined:

“[P]roperly participating in the interactive process means that an employer cannot expect an employee to read its mind and know that he or she must specifically say ‘I want a reasonable accommodation,’ particularly when the employee has a mental illness. The employer has to meet the employee half-way, and if it appears that the employee may need an accommodation but doesn't know how to ask for it, the employer should do what it can to help.”).

How can an employer avoid this kind of situation and resulting large verdict? It is imperative that managers and supervisors have a basic understanding of the ADA and know when to elevate a particular situation to human resources. The HR Source legal team can train your supervisors in this important area. Contact us for more information. 

Our attorneys are also offering a pair of sessions at our upcoming Employment Law Conference covering ADA issues (accommodations and “tricky” terminations), so register now and join us to learn about this important topic!