Why it matters: A bag of potato chips just cost Walgreens $180,000. The national pharmacy chain agreed to the payment to avoid an Equal Employment Opportunity Commission (EEOC) suit alleging discrimination in violation of the Americans with Disabilities Act (ADA) after terminating an employee who ate the chips without paying for them. The employee said she took the $1.39 bag of chips off the shelf and ate it because her blood sugar was low and she was trying to stabilize herself to avoid a hypoglycemic attack. Although the EEOC alleged that Walgreens knew about the employee’s Type II diabetes, she was terminated. The payment includes both emotional distress and lost wages for the former employee, and the company will also update its policies and provide additional training to employees regarding compliance with the ADA.

Detailed Discussion

Josefina Hernandez worked as a cashier at a South San Francisco Walgreens. An employee of the company for 18 years with no disciplinary record, Hernandez took a $1.39 bag of potato chips off the shelf in September 2008 and ate them to stabilize her blood sugar level during a hypoglycemic attack while stocking shelves.

She claimed that after she started feeling better, she went to pay for the chips but no one was at the register. She put the chips under the counter and returned to restocking items.

When asked for an explanation by a security officer about why she took the chips without paying first, Hernandez wrote, “My sugar low. Not have time.” The guard later testified that he did not understand why she ate the chips nor did he ask for clarification of her written statement. Hernandez was terminated for violating a Walgreens “anti-grazing” policy that no matter the cost, employees may not eat any food from the shelves without first paying for it.

But Walgreens knew Hernandez suffered from Type II diabetes, the EEOC said in its subsequent lawsuit, filed in California federal court. The company had allowed her to keep candy nearby in case of low blood sugar, keep her insulin in the break room refrigerator, and take additional breaks to test her blood sugar or eat because of her diabetes. The agency alleged Walgreens committed a twofold violation of the ADA: terminating a qualified employee due to a disability and failing to make a reasonable accommodation.

Denying Walgreens’ motion for summary judgment in the suit, U.S. District Court Judge William Orrick wrote that the company “failed to allege any misconduct that is unrelated to [Hernandez’s] disability.” The parties then reached a deal.

In addition to the $180,000 payment – which includes both lost wages and emotional distress – the agreement requires Walgreens to update its policy regarding the accommodation of disabled employees and post it on the employee intranet site as well as conduct anti-discrimination training.

Walgreens did not admit fault in the consent decree.

To read the summary judgment order in EEOC v. Walgreen Co., click here.

To read the consent decree, click here.