Punitive Damages Award not Upheld Against Employer when Amount is Considered Excessive

After suffering multiple work-related injuries to his shoulder, a package-car driver was released to work with restrictions by the company doctor. A company labor manager said the work restrictions meant that the employee could no longer work as a package driver. A specialist gave the employee the same diagnosis but made the work restrictions permanent. The employee’s own doctor said the employee could return to work without any restrictions. The employee was then re-examined by the company doctor and cleared to work. After a conversation with the company’s occupational health manager, however, the company doctor changed his opinion to match that of the specialist. As a result, the employee was barred from returning to work. The employee filed a grievance under the subject collective bargaining agreement, and a fourth doctor was asked to examine the employee. That doctor requested to run a functional capacity exam to test the strength of the employee’s shoulder but was told that the company would not pay for any testing. Thus, the fourth doctor made his evaluation based on the employee’s medical records alone and concluded that the employee could not perform the essential functions of his job. Ultimately, the employee was fired and he sued the employer for retaliation. A jury awarded the employee $630,307 in compensatory damages and $2 million in punitive damages. The U.S. Court of Appeals for the Tenth Circuit found that the evidence presented supported a reasonable inference in support of the employee’s retaliation claim. The court ultimately concluded, however, that the jury’s $2 million punitive damage award was excessive and violated the employer’s federal due process rights. Employers must ensure that adverse action is never based on an employee exercising his or her right to file a claim based on a work-related injury.

Jones v. United Parcel Serv. Inc., No. 09-3275 (10th Cir. Oct. 24, 2011)