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Ninth Circuit Holds That Employers May Not Bar Former Employees From Re-Employment Because Of Past Drug Addiction

September 4, 2002

Employers may not refuse to rehire former employees based on past drug or alcohol addiction, according to a June 2002 decision by the Ninth Circuit Court of Appeals. Hernandez v. Hughes Missile Systems Co., 292 F.3d 1038 (9th Cir. 2002).

At issue in Hernandez was Hughes' "unwritten policy" of denying re-employment to any former employee whose employment ended due to termination or resignation in lieu of termination. The Ninth Circuit determined that, while this policy did not violate the ADA on its face, it was nonetheless unlawful because it had the effect of discriminating against recovering addicts.

Hernandez had been employed by Hughes for 25 years when he tested positive for cocaine in 1991. Facing the prospect of termination, Hernandez elected instead to "quit in lieu of discharge." The separation summary in Hernandez's file noted that he was "discharge[d] for personal conduct."

More than two years later, Hernandez applied for another job with Hughes. Hughes rejected his application for re-employment on the basis of its unwritten policy that all former employees who resigned in lieu of discharge were ineligible for rehire. According to her deposition testimony, the individual who rejected Hernandez's application for rehire based on this policy was unaware that he had been a drug addict or that he had elected to resign in lieu of being terminated following a positive drug test.

In his subsequent lawsuit, Hernandez claimed that Hughes violated the ADA by rejecting his application for re-employment because of his record of disability, and/or because he was regarded as being disabled. The District Court granted summary judgment for Hughes and dismissed the case.

The Ninth Circuit reversed and remanded, finding that Hernandez stated a prima facie claim of disability discrimination. First, the Court found that Hernandez suffered discrimination based on his record of disability and/or his being regarded as disabled. As evidence, the Court pointed to Hughes' position statement to the EEOC, in which the company had asserted that Hernandez "was rejected based on his demonstrated drug use while previously employed." (Hughes later argued that the Court should disregard this portion of its position statement and credit only the deposition testimony of the decision-maker, who testified that she was unaware of Hernandez's prior drug use).

Next, the Court concluded that Hernandez was a "qualified" individual when he resigned his employment in 1991 because he had the requisite skills, experience, education and other job-related qualifications for the position he sought. Indeed, his 1991 "separation summary" listed his performance as "fair" and "good." Thus, the Court declined to accept Hughes' argument that Hernandez was not qualified when he reapplied for employment more than two years later. (As evidence of Hernandez's alleged lack of qualification, Hughes pointed to the fact that when it conditionally offered to re-employ Hernandez in 1999 – after he filed suit –- he failed the necessary test.)

Hughes argued that it had articulated a legitimate non-discriminatory reason for not rehiring Hernandez. Specifically, Hughes pointed to its unwritten policy not to rehire employees who were terminated or who had resigned in lieu of discharge. Hughes argued that the policy did not treat Hernandez (or other former drug addicts) any differently than individuals who violated other personal conduct rules, such as those prohibiting fighting or stealing.

The Court rejected Hughes' argument, finding that, although the policy does not appear unlawful on its face, its application to former drug addicts is unlawful. According to the Ninth Circuit, if Hernandez is no longer using drugs, he may not be denied re-employment merely because he has a past record of drug addiction. The Court explained:

Maintaining a blanket policy against rehire of all former employees who violated company policy not only discriminates on account of past disability against persons with a record of addiction who have been successfully rehabilitated, but may well result, as Hughes contends it did here, in the staff member who makes the employment decision remaining unaware of the "disability" and thus of the fact that she is committing an unlawful act. Having willfully induced ignorance on the part of its employees who make hiring decisions, an employer may not avoid responsibility for its violation of the ADA by seeking to rely on that lack of knowledge.

Id. at 1044.

The Hernandez decision itself applies only in those states covered by the Ninth Circuit (namely, California, Oregon, Washington, Arizona, Montana, Idaho, Nevada, Alaska and Hawaii). However, employers in all fifty states are well-advised to review the impact of their employment policies (both written and unwritten) on individuals with disabilities. As Hernandez demonstrates, even those policies that apply to all employees, disabled and non-disabled alike, may be unlawful under the ADA. And there is another lesson to be learned from Hernandez – employers should take pains to ensure that their written submissions to the EEOC and other administrative agencies are factually accurate, as any inaccuracy in those submissions may be used to their disadvantage in a subsequent phase of litigation.