Terminating Employees for “Bad Faith” Harassment Complaints Fraught With Peril

By: Chance Hill

In EEOC v. HP Pelzer Auto. Sys., the U.S. District Court denied the employer’s motion for summary judgment on a retaliation claim. The employer received a complaint that its HR manager had made two offensive, sex-related, comments. The employer’s investigation turned up three witnesses who denied the manager had made the comments. Concluding that the complaint was false, the employer discharged the complainant for making a complaint that was not in “good faith.”

The EEOC contends that the employer unlawfully retaliated against the complainant because of her opposition to its discriminatory practices. The employer admits that it terminated the employee because of her complaint, but argues that she forfeited protection by bringing a false complaint. The EEOC argued that, even if the employer had a good faith belief that the complaint was unfounded, the employer still has to show that the complainant did not also act in reasonable good faith, as used in Title VII.

The Court denied summary judgment. In resolving an employer’s motion for summary judgment, the court assumes the employee’s version of the facts is true; consequently, the court assumed the employee had a basis for her complaint. The employer needs proof the complainant acted in such bad faith that she forfeited protection from retaliation. The Court also underscored that it could not ascertain the reasonableness of the employer’s belief without making credibility determinations—a determination appropriate for the jury, but not the Court.

This case – brought by the EEOC – highlights the risk of employer policies that threaten termination for bad faith internal complaints. It is one thing to disbelieve a complaining employee, based on reasonable evidence. It is another thing to determine for yourself that the complainant does not deserve protection from retaliation. The second judgment is one the EEOC might dispute.

EEOC v. HP Pelzer Auto. Sys, Inc., No. 1:17-cv-00031 (E.D. Tenn. Aug. 3, 2018) (order denying summary judgment).