In a significant legal defeat for Walmart (WMT), a San Bernardino County jury has mandated that the retail giant pay former truck driver Jesus “Jesse” Fonseca $35 million. This includes $25 million in punitive damages and $9.7 million in actual damages for wrongful accusations of workers’ compensation fraud, as reported by Fortune.
Fonseca, who served Walmart for 14 years, was involved in a rear-end collision in 2017 while driving a company truck, leading to injuries that necessitated restrictions on his work activities. Despite medical advice to avoid commercial driving and heavy lifting, Walmart not only denied his requests for adjusted duties but also accused him of fraud based on surveillance showing him driving a personal vehicle. This accusation led to his termination on grounds of “intentionally dishonest” behavior during his injury leave, branding him ineligible for rehire.
The lawsuit, filed in 2019, argued that performing personal tasks within physical limitations does not equate to fraud. Fonseca’s attorneys emphasized that even if an employee inadvertently exceeds their work restrictions, it should not be misconstrued as deceitful conduct. However, Walmart contested the verdict, preparing to seek remedies, arguing that the decision was not reflective of the case’s facts.
Post-termination, Fonseca faced significant employment challenges. His dismissal for “gross misconduct and integrity” issues, due to the fraud accusation, deterred prospective employers from offering him jobs, severely impacting his career prospects.
This case highlights broader issues within the logistics and retail sectors, especially concerning employee treatment and the implications of workers’ compensation claims. Walmart’s truck drivers, who play a critical role in the company’s operations, were subject to salary boosts in 2022 amid a national driver shortage, yet this case shows the potential pitfalls in how employee health and integrity are managed.
Fonseca’s legal team underscored the verdict’s significance, with lawyer Mohamed Eldessouky stating it sends a clear message about the careful handling of employee character and integrity. This ruling could prompt Walmart and similar companies to reassess their approach to employee welfare and accusations, particularly in the high-stress, high-demand environment of logistics.
Walmart’s response to the verdict, as communicated to Fortune, indicates their disagreement with the jury’s decision, suggesting potential further legal action. However, this case serves as a reminder of the financial and reputational risks companies face when they mishandle employee relations, especially in matters concerning health, safety, and ethical accusations.
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