Barbosa v. IMPCO – Terminating an Employee for Mistakenly Falsifying Time Card Violates Public Policy

Although well-established law in California holds that an employer may not retaliate against an employee who has a valid wage claim, a November 30, 2009 appellate court ruling also protects employees against retaliation for mistakenly believing they have a valid wage claim.  Barbosa v. IMPCO Technologies, Inc. (2009 Westlaw 4227462).

Former employee Manuel Barbosa sued employer IMPCO for wrongful employment termination after IMPCO fired him for allegedly falsifying his time card.  According to his testimony at trial, Barbosa, an hourly team leader of eight other workers, became convinced after talking with two of his group’s workers that he and others were missing two hours of overtime.  Barbosa approached the company’s payroll administrator and informed her that most of his group’s workers were not paid that overtime, possibly because the recently-installed time clock was malfunctioning (the previous time clock system was known to make timekeeping mistakes).  After Barbosa’s supervisor said he trusted Barbosa and approved the overtime pay, the payroll administrator paid all eight employees in Barbosa’s group the additional two hours of overtime.

Upon further investigation into the accuracy of the new time clock, the payroll administrator and human resources manager reviewed security tapes against the time clock records which effectively determined Barbosa and the others could not have worked the claimed two hours of overtime.  Additionally, one of the group workers informed the human resources manager that she should not be paid for extra overtime because she had not worked those hours.

Barbosa was then questioned before company management officials.  When asked if he was sure he and his group worked overtime as he claimed, he said yes.  After showing Barbosa the security gate report, he said he was confused and he offered to pay the extra overtime back to the company.  However, the company refused his offer and terminated Barbosa for falsifying time card records.  Barbosa testified the stated reason for termination was “cheating the company.”

After Barbosa finished putting on his evidence at trial, IMPCO successfully moved to dismiss his case.  Barbosa appealed.

The appellate court reversed, ruling that (a) public policy protects Barbosa from being terminated if he made a good faith claim to overtime; and (b) Barbosa presented sufficient evidence at trial to support a jury finding that the overtime claim was indeed made in good faith.

The appellate court determined that when an employee exercises his or her legal right to overtime wages out of a reasonable good faith belief he or she is entitled to those wages, he is still protected from employer retaliation even if the employee later discovers he is wrong.  Here, Barbosa gave evidence showing he had a reasonable good faith belief he was entitled to the two hours’ of overtime.  The previous time clock system was known to be faulty, the new system had been installed less than a month prior to this incident, his co-workers convinced him the overtime was due and unpaid, and he in turn convinced his supervisor. Barbosa also testified he was confused.

IMPCO argued Barbosa was terminated for misrepresenting that he worked overtime and cheating his employer.  The appellate court concluded IMPCO “misses the point” because if Barbosa proves to the jury he had a reasonable good faith belief in his right to overtime, then it’s impossible to also conclude he attempted to cheat IMPCO.  Thus, the case should have been submitted to the jury for deliberation.

According to this holding, public policy requires that employees should be able to openly question their employer regarding pay-related matters without fear of retaliation, even if the employee’s pay concerns are ultimately incorrect.

If you have any questions, please contact me or any of our other employment law attorneys.   Best,  Cindy Bamforth, Esq.