Employee Who “Moons” Supervisors Forfeits Severance Benefits; Written Warning Issued to Employee Doesn’t Preclude Discharge for Same Offense


[author: Ted Olsen]

Even though it often doesn't seem that way, the law sometimes follows common sense.  In Selch v. Columbia Management,[1] an Illinois appellate court approved a lower court decision in favor of an employer that fired an employee and denied him substantial benefits under a written severance agreement, after he "mooned" his immediate supervisor and another corporate executive in protest of the employer's dismissal of a friend and work colleague.

The employee's written severance agreement provided lucrative severance benefits, so long as the employee was not fired for "cause," which was defined at an elevated level:  "conviction of a felony, engaging in misconduct that injures the Company, performing your duties with gross negligence or any material breach of your fiduciary duties as an employee of the Company."  In this case, the discharged employee conceded that his "mooning" was misconduct, but argued that there was no showing that the employer had suffered economic injury as a result.  The Court rejected his argument, concluding that a financial injury was not required:  "There is no ambiguity in these facts. The clear interpretation of plaintiff's behavior is that it was insubordinate, disruptive, unruly and abusive. Thus, the behavior caused injury to the company by undercutting the authority of plaintiff's bosses - including Banks, Sayler, and McQuaid - and disregarding company policies, calling for . . . the observation of all rules and regulations which the company establishes to govern the conduct of its business and that of its affiliates, as stipulated in the Agreement."

An interesting "double jeopardy"-type legal question was also presented.  Shortly after the "mooning" episode, the employee was presented with (and signed) a letter warning him that, if in the future he violated any of the employer's standards in any aspect of his job, he could be fired immediately.  (No doubt this conservative approach was taken by the employer because it was unsure whether it could prove that his misconduct had "injure[d] the Company.")  When a higher-ranking executive learned of the "mooning," however, he insisted that the plaintiff be fired.  This meant that he was both warned and discharged for the same misconduct.

The plaintiff argued creatively that the written warning he signed was a contract, which was breached when he was subsequently fired.  The Court rejected this theory, concluding, "at no point did the letter state that it was a contract; to the contrary, it was explicitly called a warning and not a contract."

[1] Selch v. Columbia Management, Nos. 1-11-1434 & 1-11-2060 (Ill. App. Aug. 29, 2012).


DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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