Discharge Upheld Based on Disputed Employee Mileage Reimbursements

Last month, the U.S. District Court in Norfolk granted summary judgment to a defendant employer in an age discrimination lawsuit filed by a 52-year-old ex-manager who had been terminated and replaced by someone half her age.

In Masterson v. AAAA Self Storage Mgmt Group (2014), the plaintiff, Ellen Masterson, sued her former employer (“AAAA”) for allegedly violating the Age Discrimination in Employment Act (“ADEA”).  The ADEA, of course, makes it unlawful for any employer “to discharge . . . or otherwise discriminate against any individual . . . because of such individual’s age[.]”  This federal Act applies to all private sector employees age 40 and above who work at companies with 20 or more employees.

Masterson claimed that AAAA had violated the ADEA when it terminated her from her position as facility manager in August 2010 (when she was 52 years old), subsequently replacing her with another woman, Christina Taylor, who was just “26 or 27 years old at the time.”  Her employer disputed that Masterson’s age was a factor in her termination, and asserted that she had been fired for falsifying company documents.  Following discovery, the defendant moved for summary judgment on December 13, 2013; the Court entered its Order granting the motion on January 17, 2014.

Masterson had been hired by AAAA in February of 2005 as a facility manager for the company’s Suffolk location, and she had remained in that position until her termination.  All of AAAA’s facility managers are responsible for general oversight and management of their respective facilities; in addition, they handle large amounts of money and routinely deposit cash from facility at the local bank branch.  In July 2010, Masterson’s supervisor (the District Manager) confronted her about some claims for mileage reimbursement which appeared to be inflated.  Masterson agreed that future travel reimbursement requests would be “accurate to the penny” going forward.

The next month, however, the District Manager allegedly discovered that Masterson had requested mileage reimbursement for four bank trips that she never made.  Like many employers, AAAA’s policy & procedure manual identifies several kinds of acts that may result in immediate discharge of an employee, including: “(1) theft of company property; (2) dishonesty of any kind; and (3) falsification of employment records, work records, or other company records.”  Accordingly, AAAA terminated Masterson’s employment on August 24, 2010.

In her lawsuit filed December 19, 2012, Masterson contended that her reimbursement requests were not falsified, that the District Manager had done “nothing to inquire and/or investigate the reliability of her assumptions” that certain travel slips were falsified, and that AAAA had used “falsification of company records as an excuse” to terminate Masterson because of her age.  In seeking summary judgment, AAAA argued that no reasonable jury could conclude that Masterson’s age was the real reason for her termination.

Once Masterson successfully established all of the necessary elements for an ADEA discrimination claim, the burden was on AAAA to articulate a legitimate, nondiscriminatory reason for her termination.  When it did so — by proffering the policy & procedure manual as proof that falsification of company records is grounds for immediate termination — the burden shifted back to Masterson to show that the employer’s stated reason was mere pretext, and that age discrimination was the real motivation behind her termination.

The Court found that Masterson failed to produce evidence that the defendant’s proffered reason for terminating her was “unworthy of credence,” much less any evidence that her age actually motivated AAAA to terminate her employment.  Masterson insisted that she really had gone to the bank on the days in question, and that the defendant hadn’t sufficiently investigated her side of the story.  But as the Court pointed out, “whether the Defendant’s termination of Ms. Masterson was the correct decision, a wise decision, or even a mistaken decision, is not the issue.”  For purposes of summary judgment, it is not the Court’s role “to decide whether Defendant’s reason was wise, fair, or even correct, ultimately, so long as it truly was the reason for [Ms. Masterson’s] termination.”  In this case, all of the evidence clearly showed that the seemingly false reimbursement records were the sole reason for Masterson’s termination; accordingly, AAAA was entitled to summary judgment as a matter of law.

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