Jul 01, 1992 Employment Termination

Appellate Division Rejects Discrimination Claim Based on Discharge for Positive Drug Test

The New York State Supreme Court, Appellate Division, Third Department, recently sustained a decision of the Unemployment Insurance Appeal Board (the “Appeal Board”) which denied unemployment benefits to a claimant who was discharged for having tested positive for cocaine use. In Atkinson v. B.C.C. Associates, 1992 N.Y. App. Div. LEXIS 8896 (July 9, 1992), the court concluded that the results of such a test could be the basis for a finding of employee “misconduct” (which disqualifies a claimant from receiving unemployment benefits). In a ruling apparently inconsistent with the decision in an earlier case by another New York appellate court, the Atkinson court rejected the claimant’s argument that the discharge constituted discrimination on the basis of a disability (drug dependency), in violation of the State Human Rights Law.

B.C.C. Associates is engaged in the business of providing money counting services and equipment. Claimant Atkinson was a cashier for B.C.C. and, as part of her duties, handled in excess of $10,000 in cash daily. B.C.C. required Atkinson and other cashiers to be subject to various security procedures, including drug testing. All cashiers were required to sign an agreement acknowledging that information obtained from these procedures could be the basis for dismissal. In a urinalysis performed as part of a random drug test by B.C.C., Atkinson tested positive for cocaine use. Based upon this test, Atkinson’s employment was terminated.

The Appeal Board ruled that Atkinson’s employment had been terminated for misconduct, and that she was therefore not entitled to unemployment benefits. On appeal of the that ruling, the court found the Appeal Board could reasonably have determined “that the use of cocaine by an employee in a security-sensitive position such as that held by claimant sufficiently reflected on her integrity so as to constitute misconduct.”

Significantly, the court rejected Atkinson’s contention that her discharge constituted unlawful disability discrimination, an argument based on the decision of another court two years ago in Doe v. Roe, 160 A.D.2d 255, 533 N.Y.S.2d 365 (1st Dep’t 1990). The plaintiff in Doe, an applicant for a position as a financial analyst with an investment banking firm, tested positive for the use of cocaine and morphine; after a second test confirmed the results, the plaintiff was denied the position. The plaintiff claimed that the positive result was false, and brought suit under the Human Rights Law, contending that he had been denied employment on the basis of the “perceived disability” of drug dependency. The court denied a motion to dismiss the suit, emphasizing that the Human Rights Law prohibits “discrimination against disabled persons, including drug abusers, who are able to perform their jobs.” Thus, the court suggested that even if the positive result was accurate, it is unlawful to deny employment based solely upon a test result, without a specific showing by the employer that an instance of drug abuse would prevent the applicant from performing the duties of the position. With respect to the plaintiff’s challenge to the accuracy of the test, the court reasoned that the employer must ensure that any pre-employment test or standard “bears a rational relationship to and is a valid predictor of employee job performance, and that it does not create an arbitrary, artificial and unnecessary barrier to employment which operates invidiously to discriminate on the basis of an impermissible classification.” The court concluded, in Doe, that the Human Rights Law’s prohibition of discrimination on the basis of actual or perceived disability was broad enough to encompass a claim that an individual was wrongfully considered a drug abuser based upon an allegedly false test result.

The Atkinson court summarily rejected the claimant’s discrimination claim, without discussing Doe, and it is difficult to reconcile the two decisions. While the Atkinson court emphasized the security concerns associated with the claimant’s duties, it is not clear that its apparent approval of drug testing was intended to be limited to situations where such concerns are present. Ultimately, the apparently inconsistent results in Doe and Atkinson, and the lawfulness of drug testing by private employers in New York, will have to await resolution by New York’s highest court, the Court of Appeals.