Great Lakes Wire

On June 17, the U.S. Court of Appeals for the Sixth Circuit issued an opinion in Kean v. Brinker International, Inc., reversing a summary judgment previously granted to the employer and sending a former Chili’s general manager’s Age Discrimination in Employment Act (ADEA) case back for trial. This decision highlights potential risks for employers using "culture" or "cultural fit" as grounds for termination, especially when documentation is insufficient or electronic records are missing.

The plaintiff, a 59-year-old general manager, was replaced by a 33-year-old with no managerial experience after being discharged. Brinker International, Inc., Brinker International Payroll Company, and Chili’s, Inc. (collectively referred to as “Chili’s”) claimed that complaints about the restaurant's "culture" and the belief that the manager was not "living the Chili’s way" led to this decision. The district court initially sided with Chili's by granting summary judgment based on its "culture" rationale and dismissed the employee's evidence as inadequate to prove pretext.

Upon appeal, the Sixth Circuit reversed this decision, ruling that:

- A key exhibit from Chili's — a “Team Member Relations” (TMR) report summarizing internal emails regarding alleged mismanagement — was inadmissible since no witness could authenticate it after related emails were deleted due to what was described as Chili’s “gross negligence.”

- The failure of Chili's to preserve these emails and other personnel records amounted to spoliation; thus, the appellate court instructed the district court to reconsider sanctions beyond attorneys’ fees.

- Without the TMR report, there was insufficient evidence from Chili's showing that “culture” issues genuinely motivated the termination. Meanwhile, strong performance metrics presented by the employee along with age-related comments and a pattern of replacing older managers established a triable issue of pretext.

The ruling serves as a reminder for employers that terminations based on vague notions like “toxicity” or “cultural mismatch,” without contemporaneous documentation defining these concepts, are susceptible to wrongful termination claims. Employers should consider several practices to mitigate such risks:

1. Document performance concerns in real time by translating abstract concepts into specific behaviors such as turnover spikes or customer complaints and preserving relevant data.

2. Preserve electronically stored information (ESI) when appropriate by issuing litigation holds when litigation is reasonably anticipated and ensuring document retention protocols protect relevant evidence.

3. Corroborate complaints before acting by conducting independent investigations and creating written findings before approving terminations.

4. Ensure decision-makers know — and can defend — key facts by requiring them to document reasons for decisions at the time they are made.

The Kean opinion underscores that culture-based terminations lacking clear evidence and robust document retention can lead to significant litigation exposure. Employers should strengthen documentation protocols, reinforce ESI preservation practices, and train leaders to articulate performance-related reasons clearly and objectively.

Employers interested in implementing these risk mitigation measures may contact Warner Norcross + Judd's Labor and Employment Practice Group.

Article courtesy of Warner Norcross + Judd.