Baggs v. Eagle-Picher Industries, Inc., File No. G89-50911-CA.

CourtUnited States District Courts. 6th Circuit. United States District Court (Western District Michigan)
Citation750 F. Supp. 264
Docket NumberFile No. G89-50911-CA.
PartiesRalph BAGGS, Vern Baggs, Jr., Thomas A. Brown, Gary A. Delecki, Bill Elya III, Lori J. Glick, Merrill J. Hansen, Tracy Helsel, Robert Kanaziz, Anthony F. Krol, Garry Moore, Timothy Morrison, Deane W. Pahl, Penny J. Pahl, Gary Parker, Gary Roessler, Mark Russell, David Wilson, Mark Birgy, Daniel Cummer, Mary Ann Fender, Walter Montney, Michael Mooring, Patricia Russell, Daniel Schelske, Barbara Schirripa, Nadine Wells, James D. Wilson, II, James MacDonald, and persons similarly situated, Plaintiffs, v. EAGLE-PICHER INDUSTRIES, INC., an Ohio corporation, Defendant.
Decision Date30 July 1990

Craig W. Elhart, Elhart and Power, Traverse City, Mich., for plaintiffs.

Jon G. March, Miller, Johnson, Snell and Cummiskey, Grand Rapids, Mich., for defendant.



Now before the Court is defendant's motion for summary judgment pursuant to Fed.R.Civ.P. 56(c) (Rule 56) as to Counts I, II, IV, VI and portions of Count III of plaintiffs' third amended complaint. Also before the Court is defendant's motion for dismissal pursuant to Fed.R.Civ.P. 12(b)(6) Rule 12(b)(6) as to the remainder of Count III and all of Count V of plaintiffs' third amended complaint.


This case arises out of surprise drug test conducted by defendant in August 1989. Defendant is an Ohio corporation with a division located in Kalkaska, Michigan. The Kalkaska plant is defendant's Trim Division which makes parts such as headliners and door panels for the automotive industry. Employees at defendant's plant work in teams in the assembly process. Some of the activities conducted by the teams are potentially hazardous such as hydraulic and electronic presses, forklifts and hot glue and adhesive.

Defendant employs approximately 230 people at its Kalkaska plant. Each of the employees signed an application form in which the language varied slightly depending on the year of application. However, each of the applications contained one of the paragraphs below:

I understand and agree that if employed, the employment relationship can be terminated at will without notice or cause by either party, notwithstanding any other oral or written statements by the company prior to, at or following the date of employment, unless set out in writing, dated, and executed by both parties.
I also understand and agree that, if hired, my employment is for no definite period and may, regardless of the date of payment of my wages, be terminated for any reason or no reason at any time at the sole discretion of the company without prior notice.
I understand and agree that, if hired, my employment is for no definite period and may, regardless of the date of payment of my wages and salary, be terminated at any time without any prior notice.

The employee handbook given to each employee states:

This handbook, with its rules and regulations, is not to be considered as generating terms and conditions of an employee contract. You have the right to terminate your employment at any time without notice and without cause, and the company maintains the same right.

The employee handbook also contains a progressive discipline section which sets forth four basic disciplinary steps. There is first a verbal warning, followed by a written warning, a final warning and discharge. The disciplinary section also states:

These 3 steps may not always be followed. It depends on how serious or negligent the initial offense is. If a serious offense takes place, discharge may result without any of the other warnings taking place.
If any employee receives disciplinary action which they feel is unfair, management will have an open ear and listen to your complaint. A discussion of all the facts should reveal the most fair decision. The most important point that should be made when disciplinary action occurs is that it is done in the most fair and equitable manner possible.

In 1988 and 1989, defendant's management became aware of a drug problem at its Kalkaska plant. Defendant became aware of the problem through employee complaints, truck drivers making deliveries and a building contractor doing work at the plant. In response to this information, defendant posted a drug free workplace policy in April 1989. This policy prohibited employees from possessing, using or being under the influence of drugs while at work and provided that employees could be tested for drug use. Defendant also required all new applicants to submit to drug testing as a prerequisite to being hired.

In April 1989, defendant consulted with the Grand Traverse Narcotics Team and the Kalkaska County Sheriff and placed an undercover officer in the plant as an employee. The officer arrested two employees for selling drugs. For emphasis, defendant agreed to have the employees arrested at the plant. It is unclear from the pleadings whether these employees were arrested for selling drugs at the plant or at some other place. After the undercover officer finished his undercover work, he reported to defendant's management that he estimated that as many as 60% of defendant's employees used drugs at home, at work or both. Several of the plaintiffs have admitted that people were using drugs at work.

On July 17, 1989 a new drug free workplace policy was posted. That policy stated:

It is the policy of this Company to provide a workplace free of alcohol and drugs, and to ensure that employee alcohol or drug use does not jeopardize the success of its operations, or otherwise affect the Company, its employees or its customers.
The use, sale, attempted sale, manufacture, purchase, attempted purchase, possession or transfer of alcohol or an illegal drug while on Company property or reported to work with alcohol, illegal or illicit drugs in the employee's system is a violation of Company rules and will result in disciplinary action, up to and including discharge.
Employees who believe or have been informed that their use of a drug (prescribed or over-the-counter) may present a safety risk, are to report the use of such drug to their supervisor before starting to work to ensure safety of themselves, other employees and Company property.
Employees who believe they have an alcohol or drug abuse problem can seek voluntary assistance through the personnel department. It is the employee's responsibility to seek help before the employee's alcohol or drug problems lead to disciplinary action, up to and including discharge. The Company will assure strict confidentiality to each employee who seeks assistance, and will assist each employee in obtaining the needed help through the Company's group medical benefits.
While the Company believes in respecting the rights of employees, it is also concerned about the safety, job security and job performance problems created on the job through the use of drugs and alcohol by employees.
In order to protect the well-being of our employees, our facilities and the community in which we live, each employee, as a condition of employment will be required, upon request of Company supervisory personnel, to submit to blood and/or urine tests for determining use of alcohol and/or illegal or illicit drugs.
Employees convicted of criminal drug statute violations, which result from activities occurring on or off Company premises while conducting Company business, must notify the Company within five (5) days of the conviction.
Employees must abide by the terms of this Policy as a condition of continued employment.

This policy was also included in the handbook distributed to the employees on August 7 and 8, 1989.

On August 10 and 11, 1989, defendant announced that it was going to conduct drug testing on those days. Only three people in management knew about the tests ahead of time. The men and women employees were asked to go into the men and women's bathrooms respectively and produce urine samples. There was a nurse present in each bathroom (a male nurse in the men's bathroom and a female nurse in the women's). Employees were told that, if they did not want to take the test, they could leave the plant and they would be considered a voluntary quit. Some employees who are plaintiffs in this suit did leave and were considered as voluntary quits as of that date. The remaining employees who gave samples signed consent forms and initialed chain of custody forms. Employees who were tested later were tested at a local health clinic. The samples were sent to SmithKline Bio-Science Laboratories in St. Louis, Missouri for testing. The testing for marijuana was set at a level to register a negative for anyone who had been exposed to passive inhalation of the substance. All positive results were confirmed by gas chromatograph/mass spectrometry which defendant believes is the same testing format used by the National Football League. A number of the plaintiffs tested positive for marijuana, one tested positive for cocaine and one for propoxyphene. Plaintiff Daniel Schelske was retested because of contamination and his second test was positive. Plaintiff Daniel Cummer tested negative. However, on August 16, 1989, he refused to work assignment, walked off the job and was considered a voluntary quit.

Following the drug testing, the news media were informed by one of the plaintiffs that it had occurred. As a result, the media contacted Michael Aslanian, defendant's vice president, for comment. Mr. Aslanian confirmed the drug testing. Mr. Aslanian also confirmed that some employees had left rather than take the test and the some employees had been terminated for positive test results. At no time did Mr. Aslanian name any of the employees nor did defendant initiate the media coverage.

Count I of plaintiffs' third amended complaint alleges breach of contract for the failure of defendant to follow the progressive disciplinary stages set forth in the employee handbook in the drug testing and termination of...

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