Major Changes to NJ Laws – Severance Pay Mandate and Worker Misclassification

In a case that offers good news to employers, the U.S. Court of Appeals for the Eighth Circuit held that an employer’s good faith belief that the employee had engaged in workplace misconduct supported its termination decision, despite its inability to prove such misconduct.

In Rinchuso v. Brookshire Grocery Co., a male employee was fired following a Human Resources investigation into a complaint that he had viewed pornography at work. HR interviewed four female co-workers who stated that he had viewed porn, gambled, and touched them inappropriately. As part of the investigation, IT reviewed his computer but was unable to determine conclusively if he had viewed porn. The employee, while denying any viewing of porn, admitted to visiting sports and dating sites on his computer. The Eighth Circuit found that, even though there was no conclusive evidence that he had violated the employer’s internet and conduct policies, the interviews with the co-workers and his own admissions provided a good faith basis for his termination.

Often employers believe that they must have conclusive evidence of misconduct – akin to the “smoking gun” in a criminal case. There is a reluctance to rely on “hearsay evidence” – i.e. he said/she said situations. Hearsay, however, is a rule of evidence in a court of law and not the workplace. Employers may make decisions based on co-worker statements, even if they cannot be conclusively proven, as long as their belief is reasonable and rational.