Workers with substance abuse issues benefit from ‘last chance agreements’

Substance abuse is a rapidly growing workplace issue, especially given the recent opioid epidemic. Many employers are scratching their heads wondering what they can do, and many employees affected by the problem are wondering if there is a way to save their jobs.

Of course, substance abuse is a major problem in the workplace, since it can lead to absenteeism, lost productivity, increased health care costs, and in the worst cases, accidents, injuries and even violence.

On the other hand, many companies want to be compassionate to good workers who are facing up to their problems and seeking treatment. In addition, drug and alcohol addiction are considered “disabilities” under the federal Americans with Disabilities Act, as well as many state laws, which means that firing someone simply because of an addiction may be illegal.

Increasingly, businesses are dealing with the problem with a “last chance agreement,” or LCA. This is basically a written understanding in which a worker agrees to go to treatment and follow a program of recovery – and acknowledges that the company can fire him or her immediately if there’s a slip-up.

If you’re thinking of asking an employee to sign an LCA – or signing one yourself – you probably want to talk to an attorney first, because there are a lot of issues to consider. For instance:

  • Who will pay for the employee’s treatment? Will it be covered by the employee’s health insurance at work?
  • If the employee will miss work due to treatment, will this be considered family and medical leave, sick leave, vacation, personal leave, or some combination?
  • Can the company monitor the employee’s participation in the treatment program? After the employee returns to work, can the company perform unannounced drug tests? How often and for how long?
  • Does the company have a right to receive medical information from the employee’s doctors? If so, what must the employee do to waive his or her medical privacy rights? What happens if the employee’s substance-abuse treatment overlaps with treatment for some other, private medical problem?

A big issue with LCAs is that it might be illegal for a company to ask an employee to sign one unless it can document that the employee’s substance abuse problem has actually created problems at work.

For example, Anthony DePalma, an assistant fire chief in Lima, Ohio, became addicted to pain medications following his treatment for kidney stones. The painkiller addiction grew into a heroin addiction, and DePalma took responsibility and voluntarily checked into a rehab center. While he was in rehab, he got a visit from the fire chief, who told him he’d have to sign an LCA to avoid being fired.

DePalma brought a disability discrimination lawsuit against the city, arguing that the LCA was a form of punishment based solely on his illness. And an Ohio appeals court agreed with him.

According to the court, the fact that DePalma had no prior work violations or performance issues indicated that he was being punished merely for his status as a recovering addict, rather than for any bad workplace behavior – which is illegal.

On the other hand, a federal appeals court in Philadelphia decided that a freight company had a right to force a driver to sign an LCA after he took medical leave to go to an alcohol rehab program. The LCA prohibited the driver from consuming any alcohol as long as he worked there. The driver relapsed within a month and sought additional treatment, at which point the company fired him. According to the court, this was okay because a driver who consumes alcohol at work could pose a serious risk of injury.

Most employers will want an LCA to specify that the agreement doesn’t change the fact that the employee is “at will.” For instance, an Oklahoma employee who was accused of sexually harassing his secretary signed an LCA saying he could be fired immediately for any further substance abuse or sexual misbehavior. The employee was later fired after more facts came out about his previous misbehavior. The employee argued that under the LCA, he was no longer “at will,” and could be fired only for subsequent misbehavior.

A federal appeals court eventually sided with the employer, but the lawsuit could probably have been avoided if the LCA had been clearer.

An employer also has to be consistent about enforcing LCAs. If a company fires one worker after the first “slip,” but chooses to forgive another worker, the first worker could claim that his or her firing was illegal discrimination.