Employee Drug Testing: Third Parties' Duty of Care

By virtue of the Sharpe decision, Pennsylvania became the second state in the last 4 years to allow a cause of action for negligence against third parties who are involved in employee drug testing. The Wyoming Supreme Court, in the matter of Duncan v. Afton, Inc., 991 P.2d 739 (Wyo. 1999), had also ruled that a collecting company owes duty of reasonable care to an employee required to submit a urine specimen. Similar state court decisions recognizing a duty of reasonable care include Elliott v. Laboratory Specialists, Inc., 588 So. 2d 175 (La. Ct. App. 1991) (drug testing laboratory owed duty of care to testee/employee regardless of contractual arrangement between lab and employer); Stinson v. Physicians Immediate Care, Ltd., 646 N.E.2d 930, 934 (Ill. App. Ct. 1995) (laboratory better placed to guard against injury and to bear financial burden of ensuring test accuracy than individual who would be 'wrongfully maligned by a false positive report'); Devine v. Roche Biomedical Lab., 659 A.2d 868, 871 n.2 (Me. 1995) (assuming existence of duty from laboratory to plaintiff but finding no negligence in case at bar); O'Connor v. SmithKline Bio-Science Labs., Inc., 631 N.E.2d 1018 (Mass. App. Ct.), review denied, 639 N.E.2d 1082 (Mass. 1994) (same); Irwin v. Wal-Mart Stores, Inc., 813 S.W.2d 99 (Mo. Ct. App. 1991) (same).

The Path to Recognizing a Duty of Care

The Wyoming, Pennsylvania, and Illinois courts traveled similar analytical paths in arriving at their respective holdings.

The Wyoming Supreme Court, relying on its own precedents and Tarasoff v. Regents of Univ. of California, 551 P.2d 334, 342 (Cal. 1976), assessed eight factors in arriving at its conclusion that a duty should be imposed on those facilities undertaking employee drug testing at the behest of employers:

• the foreseeability of harm to the plaintiff;
• the closeness of the connection between the defendant's conduct and the injury suffered;
• the degree of certainty that the plaintiff suffered injury;
• the moral blame attached to the defendant's conduct;
• the policy of preventing future harm;
• the extent of the burden upon the defendant;
• the consequences to the community and the court system; and
• the availability, cost and prevalence of insurance for the risk involved.

Duncan, 991 P.2d at 744.

The Pennsylvania Supreme Court, relying on its recent holding in Althaus v. Cohen, 562 Pa. 547, 553, 756 A.2d 1166, 1169 (2000) balanced five factors in concluding that a duty should be imposed upon the alleged tortfeasor:

• the relationship between the parties;
• the social utility of the actor's conduct;
• the nature of the risk imposed and foreseeability of the harm incurred;
• the consequences of imposing a duty upon the actor; and
• the overall public interest in the proposed solution.

Sharpe, 821 A.2d at 1219.

In Stinson, the Illinois appellate court summarized its analysis by stating that '[w]hether a duty exists is a question of law which depends on whether the parties stood in such a relationship to one another that the law imposes an obligation on the defendant to act reasonably for the protection of the plaintiff.' Stinson, 646 N.E.2d at 933 (citation omitted). Continuing, the court explained that '[i]n considering whether a duty exists in a particular case, a court must weigh the foreseeability of the injury, the likelihood of the injury, the magnitude of the burden of guarding against it and the consequences of placing that burden on the defendant.' Id. (citation omitted).

Additionally, all three courts, while acknowledging the fact that the employees had no contractual relationship with the drug screening companies, discounted the notion that privity of contract is required for one party to owe a duty of reasonable care to another. See Sharpe, 821 A.2d 1215, n. 3 ('Privity of contract, however, is not an essential prerequisite to the existence of a duty, as the law may operate under certain circumstances to impose a duty in favor of a third party against one operating under a contract, without reference to the terms of that contract.'); Stinson, 646 N.E.2d at 933 ('Privity of contract should never excuse a duty imposed by law on the conduct of individuals towards another in a reasonable society.') (citation omitted); Duncan, 991 P.2d at 742 ('Courts, upon abandonment of the privity requirement, expanded tort liability by holding that a third party, not in privity of contract with a professional person or entity, may recover for negligence which proximately causes a foreseeable economic injury to him.') (citation omitted).

Some Limits

Although there has been no consensus as to the limits of this recognized duty of care in employee drug testing, several cases illuminate judicial circumscription. The Texas Supreme Court refused to impose a duty on a drug testing laboratory to warn employees that ingestion of certain substances (poppy seeds) will cause a positive test result. See SmithKline Beecham Corp. v. Doe, 903 S.W.2d 347 (Tex. 1995). Courts have also refused to allow claims against the employer when it, or its contractor, allegedly makes an error in conducting the employee's drug test. See, e.g., Bellinger v. Weight Watchers Gourmet Food Co., 756 N.E.2d 1251, 1257 (Ohio Ct. App. 2001) (no duty imposed upon employer to ensure reasonable care in drug testing of at-will employee); Graham v. Contract Transp., Inc., 220 F.3d 910 (8th Cir. 2000) (employee did not have negligent discharge claim against employer under Iowa law after being terminated for failing drug test administered by outside testing center); Carroll III v. Federal Express Corp., 113 F.3d 163 (9th Cir. 1997) (the employer had no expressed or implied contractual obligation to ensure error-free testing by the contractor).

It is also uncertain as to whether drug testing companies will be held to a duty of reasonable care vis-'-vis prospective employees who claim that the negligence led to their application for employment being denied. In Sharpe, the Pennsylvania Supreme Court did not extend its holding to prospective employees and, therefore, the Pennsylvania Superior Court's ruling in the case of Ney v. Axelrod, 723 A.2d 719 (Pa. Super. 1999), which held there is no duty owed to prospective employees, remains good law. In Duncan, the Wyoming Supreme Court did not expand the duty beyond that owed to current employees. Only the Illinois court in Stinson explicitly included prospective employees as having a sustainable negligence action. While the state courts, upon balancing the aforenoted factors, may ultimately choose to extend such protections to prospective employees, the fact that prospective employees would not face the same stigma to their careers as current employees who are terminated for a false positive drug test is a significant distinguishing feature. The Pennsylvania Superior Court in Ney expressed its own concern of expanding tort liability to prospective employees, deeming them a class of plaintiffs not 'identifiable and readily discernable' and whose alleged future harm is 'speculative at best'. Ney, 723 A.2d at 722.

Finally, it is worth noting that the Sharpe court distinguished the question at bar from the Pennsylvania line of cases refusing to impose a duty of care upon physicians conducting third-party sponsored medical examinations. In the instances where a physician, hired by a third party, is alleged to have failed to diagnose cancer during a pre-employment screening, or during an examination prior to the purchase of life insurance, Justice Saylor wrote that the alleged duty would not have been '[d]irectly subsumed within the physician's obligations under his contract ' Sharpe, 821 A.2d at 1219, n. 2. By comparison, in drug testing cases the alleged failures of the third parties go to the very heart of the purpose for which they are hired.

Plaintiffs' Practice Point

After concluding a duty of reasonable care exists, the Sharpe decision ended by stating '[i]t is, of course, for the jury to determine whether the Hospital breached such duty.'

Conclusion

As in any negligence case, then, it is critical for the plaintiff/employee to be keenly aware of what transpires during the collection and labeling of his or her urine sample. For a concise overview of the procedures involved in the collecting and processing of urine samples for drug screenings, see Newman A, Feinman JM: Liability of a Laboratory for Negligent Employment or Pre-Employment Drug Testing, 30 Rutgers L.J. 473, 474-475 (1999). At a minimum, I would counsel employees not to let their sample out of their sight until it split into two containers, sealed and labeled, with the name of the attendant identified. The employee should take note of the number of other individuals submitting specimens at that time, and their names (if known), in the event the employee later believes his or her sample was confused with another employee's. The employee should inquire as to the name of the laboratory testing the specimen and when the specimen will be sent. If the test comes back positive, they should insist that a different laboratory test the split specimen.

In April, Pennsylvania became the latest state to hold that a company hired by an employer to administer employee drug tests owes a duty of reasonable care to the employees subjected to those tests. In Renee Sharpe v. St. Luke's Hosp. , 821 A.2d 1215 (Pa. Apr. 25, 2003), the Pennsylvania Supreme Court ruled unanimously that the defendant, a hospital, owed a duty of care to Sharpe, an employee of Federal Express, with regard to collection and handling of her urine specimen for the employment-related drug test that plaintiff was required to undergo. Sharpe had been fired from Federal Express after her drug test came back positive for cocaine use and she claimed the positive result was attributable to the errors made by the hospital in collecting, labeling and processing her urine sample before sending it to a laboratory for testing. The trial court granted summary judgment for the hospital, concluding that the hospital owed no duty of care to Sharpe, with whom it had no contract. The Pennsylvania Superior Court affirmed, by a 2-1 margin, although two of the three judges concluded that the applicable rule of law was wrong and should be overruled. The Pennsylvania Supreme Court reversed.

Justice Thomas Saylor, writing for the court, cited the pronouncement of the dissenting Superior Court judge and opined, 'the increase in mandatory employment-related drug screening and the potential ramifications of false-positives create a substantial public interest in ensuring that the medical facilities involved in the testing exercise a reasonable degree of care to avoid erroneous test results occurring because of negligence.' Sharpe, 821 A.2d at 1221.

PA's Duty of Care

By virtue of the Sharpe decision, Pennsylvania became the second state in the last 4 years to allow a cause of action for negligence against third parties who are involved in employee drug testing. The Wyoming Supreme Court, in the matter of Duncan v. Afton, Inc. , 991 P.2d 739 (Wyo. 1999), had also ruled that a collecting company owes duty of reasonable care to an employee required to submit a urine specimen. Similar state court decisions recognizing a duty of reasonable care include Elliott v. Laboratory Specialists, Inc. , 588 So. 2d 175 (La. Ct. App. 1991) (drug testing laboratory owed duty of care to testee/employee regardless of contractual arrangement between lab and employer); Stinson v. Physicians Immediate Care, Ltd. , 646 N.E.2d 930, 934 (Ill. App. Ct. 1995) (laboratory better placed to guard against injury and to bear financial burden of ensuring test accuracy than individual who would be 'wrongfully maligned by a false positive report'); Devine v. Roche Biomedical Lab. , 659 A.2d 868, 871 n.2 (Me. 1995) (assuming existence of duty from laboratory to plaintiff but finding no negligence in case at bar); O'Connor v. SmithKline Bio-Science Labs., Inc. , 631 N.E.2d 1018 (Mass. App. Ct.), review denied, 639 N.E.2d 1082 (Mass. 1994) (same); Irwin v. Wal-Mart Stores, Inc. , 813 S.W.2d 99 (Mo. Ct. App. 1991) (same).

The Path to Recognizing a Duty of Care

The Wyoming, Pennsylvania, and Illinois courts traveled similar analytical paths in arriving at their respective holdings.

The Wyoming Supreme Court, relying on its own precedents and Tarasoff v. Regents of Univ. of California , 551 P.2d 334, 342 (Cal. 1976), assessed eight factors in arriving at its conclusion that a duty should be imposed on those facilities undertaking employee drug testing at the behest of employers:

• the foreseeability of harm to the plaintiff;
• the closeness of the connection between the defendant's conduct and the injury suffered;
• the degree of certainty that the plaintiff suffered injury;
• the moral blame attached to the defendant's conduct;
• the policy of preventing future harm;
• the extent of the burden upon the defendant;
• the consequences to the community and the court system; and
• the availability, cost and prevalence of insurance for the risk involved.

Duncan, 991 P.2d at 744.

The Pennsylvania Supreme Court, relying on its recent holding in Althaus v. Cohen , 562 Pa. 547, 553, 756 A.2d 1166, 1169 (2000) balanced five factors in concluding that a duty should be imposed upon the alleged tortfeasor:

• the relationship between the parties;
• the social utility of the actor's conduct;
• the nature of the risk imposed and foreseeability of the harm incurred;
• the consequences of imposing a duty upon the actor; and
• the overall public interest in the proposed solution.

Sharpe, 821 A.2d at 1219.

In Stinson, the Illinois appellate court summarized its analysis by stating that '[w]hether a duty exists is a question of law which depends on whether the parties stood in such a relationship to one another that the law imposes an obligation on the defendant to act reasonably for the protection of the plaintiff.' Stinson, 646 N.E.2d at 933 (citation omitted). Continuing, the court explained that '[i]n considering whether a duty exists in a particular case, a court must weigh the foreseeability of the injury, the likelihood of the injury, the magnitude of the burden of guarding against it and the consequences of placing that burden on the defendant.' Id. (citation omitted).

Additionally, all three courts, while acknowledging the fact that the employees had no contractual relationship with the drug screening companies, discounted the notion that privity of contract is required for one party to owe a duty of reasonable care to another. See Sharpe, 821 A.2d 1215, n. 3 ('Privity of contract, however, is not an essential prerequisite to the existence of a duty, as the law may operate under certain circumstances to impose a duty in favor of a third party against one operating under a contract, without reference to the terms of that contract.'); Stinson, 646 N.E.2d at 933 ('Privity of contract should never excuse a duty imposed by law on the conduct of individuals towards another in a reasonable society.') (citation omitted); Duncan, 991 P.2d at 742 ('Courts, upon abandonment of the privity requirement, expanded tort liability by holding that a third party, not in privity of contract with a professional person or entity, may recover for negligence which proximately causes a foreseeable economic injury to him.') (citation omitted).

Some Limits

Although there has been no consensus as to the limits of this recognized duty of care in employee drug testing, several cases illuminate judicial circumscription. The Texas Supreme Court refused to impose a duty on a drug testing laboratory to warn employees that ingestion of certain substances (poppy seeds) will cause a positive test result. See SmithKline Beecham Corp. v. Doe , 903 S.W.2d 347 (Tex. 1995). Courts have also refused to allow claims against the employer when it, or its contractor, allegedly makes an error in conducting the employee's drug test. See, e.g., Bellinger v. Weight Watchers Gourmet Food Co. , 756 N.E.2d 1251, 1257 (Ohio Ct. App. 2001) (no duty imposed upon employer to ensure reasonable care in drug testing of at-will employee); Graham v. Contract Transp., Inc. , 220 F.3d 910 (8th Cir. 2000) (employee did not have negligent discharge claim against employer under Iowa law after being terminated for failing drug test administered by outside testing center); Carroll III v. Federal Express Corp. , 113 F.3d 163 (9th Cir. 1997) (the employer had no expressed or implied contractual obligation to ensure error-free testing by the contractor).

It is also uncertain as to whether drug testing companies will be held to a duty of reasonable care vis-'-vis prospective employees who claim that the negligence led to their application for employment being denied. In Sharpe, the Pennsylvania Supreme Court did not extend its holding to prospective employees and, therefore, the Pennsylvania Superior Court's ruling in the case of Ney v. Axelrod , 723 A.2d 719 (Pa. Super. 1999), which held there is no duty owed to prospective employees, remains good law. In Duncan, the Wyoming Supreme Court did not expand the duty beyond that owed to current employees. Only the Illinois court in Stinson explicitly included prospective employees as having a sustainable negligence action. While the state courts, upon balancing the aforenoted factors, may ultimately choose to extend such protections to prospective employees, the fact that prospective employees would not face the same stigma to their careers as current employees who are terminated for a false positive drug test is a significant distinguishing feature. The Pennsylvania Superior Court in Ney expressed its own concern of expanding tort liability to prospective employees, deeming them a class of plaintiffs not 'identifiable and readily discernable' and whose alleged future harm is 'speculative at best'. Ney, 723 A.2d at 722.

Finally, it is worth noting that the Sharpe court distinguished the question at bar from the Pennsylvania line of cases refusing to impose a duty of care upon physicians conducting third-party sponsored medical examinations. In the instances where a physician, hired by a third party, is alleged to have failed to diagnose cancer during a pre-employment screening, or during an examination prior to the purchase of life insurance, Justice Saylor wrote that the alleged duty would not have been '[d]irectly subsumed within the physician's obligations under his contract ' Sharpe, 821 A.2d at 1219, n. 2. By comparison, in drug testing cases the alleged failures of the third parties go to the very heart of the purpose for which they are hired.

Plaintiffs' Practice Point

After concluding a duty of reasonable care exists, the Sharpe decision ended by stating '[i]t is, of course, for the jury to determine whether the Hospital breached such duty.'

Conclusion

As in any negligence case, then, it is critical for the plaintiff/employee to be keenly aware of what transpires during the collection and labeling of his or her urine sample. For a concise overview of the procedures involved in the collecting and processing of urine samples for drug screenings, see Newman A, Feinman JM: Liability of a Laboratory for Negligent Employment or Pre-Employment Drug Testing, 30 Rutgers L.J. 473, 474-475 (1999). At a minimum, I would counsel employees not to let their sample out of their sight until it split into two containers, sealed and labeled, with the name of the attendant identified. The employee should take note of the number of other individuals submitting specimens at that time, and their names (if known), in the event the employee later believes his or her sample was confused with another employee's. The employee should inquire as to the name of the laboratory testing the specimen and when the specimen will be sent. If the test comes back positive, they should insist that a different laboratory test the split specimen.