Employment Law Matters : Employment Lawyer & Attorney : Ogletree Deakins Law Firm : Labor Law, Human Resources

As the U.S. Supreme Court has stated, Title VII is intended to “strike at the entire spectrum of disparate treatment of men and women resulting from sex stereotyping.” Recently, a federal court in Virginia refused to dismiss the claim of a male employee who said that he was treated differently and subjected to a hostile work environment because he was viewed as effeminate and told that he was not a “real man.” Henderson v. Labor Finders of Virginia, Inc., E.D. Va., No. 3:12cv600 (April 2, 2013).

Raymond Henderson began working for Labor Finders of Virginia, Inc., a staffing company, in April 2010. Although the company had a policy of giving preference to employees who had their own transportation, Henderson (who had transportation) was assigned to projects only when it was difficult to find someone else to fill a work assignment. Henderson filed an EEOC charge and, ultimately, a lawsuit, alleging that he was discriminated against because Labor Finders found him to be effeminate. Henderson alleged that he was routinely subjected to verbal epithets and slights by and in the presence of his supervisors, and was told he “looked just like a woman,” that he was not a “real man,” and that he was “a woman pretending to be something else, because he . . . was definitely not a male or a man.”

Although Henderson alleges that he tried to complain to Labor Finders’ management, he never received a response and, in fact, was ultimately told that he was going to lose his job because he was a “troublemaker” and was creating problems for Labor Finders. He filed his lawsuit against the company and a number of individuals, claiming violation of Title VII and a number of state laws. The individuals were dismissed from the lawsuit, as Henderson had failed to name them in his EEOC charge. Labor Finders then filed a motion to dismiss the state and federal claims against the company.

The U.S. District Court for the Eastern District of Virginia granted Labor Finders’ motion as to the state law claims, but denied it with respect to the federal Title VII issues. Henderson was able to overcome the motion to dismiss the Title VII claim because, according to the court, he presented facts sufficient to “allow the court to draw the reasonable inference that the defendant is liable for the alleged misconduct.”

In its analysis, the court pointed out that Henderson’s claim “presents a tension between two well-settled principles of law.” First, it is undisputed that Title VII does not afford a cause of action for discrimination based on sexual orientation. However, at the same time, employers are not permitted to assume or insist that employees match the stereotype associated with their gender group. Title VII permits recovery, for instance, for a male employee who is treated less favorably because he is viewed as “unmanly.”

In a detailed analysis of Henderson’s claims, the court held that Henderson had set forth sufficient allegations of gender stereotyping to move his claim forward. The court found that Henderson’s perceived failure to conform with accepted gender norms was thought to reflect poorly on Labor Finders, and was viewed as displeasing that company’s clients. Therefore, Henderson’s claim that he was treated differently because of his appearance and behavior was sufficiently set forth in his complaint. The court further held that Henderson sufficiently stated a claim for hostile work environment under the gender stereotyping theory by detailing the statements made by and around supervisors, including the remarks that he was not a “real man” and “looked just like a woman.”

The line between sexual orientation, which is not yet prohibited by federal law (although prohibited under some state statutes), and discrimination “because of sex” can be difficult to draw. However, employers must recognize that an employer who takes an adverse action against an individual because he or she does not fit within sexual stereotypes is engaging in discrimination, because that discrimination would not have occurred but for the individual’s sex. If a company’s disciplinary actions are meant to punish or belittle non-compliance with gender stereotypes, the actions may constitute a violation of Title VII’s “because of sex” provision.
 

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A female plumber on “light duty” in the City of Chicago’s Department of Sewers filed a lawsuit alleging that because she was female, her supervisor assigned menial work to her, prohibited her coworkers from interacting with her, and subjected her to alleged “verbal violence.” While the district court viewed each of those actions individually and found that none constituted hostile work environment under Title VII, the7th U.S. Circuit Court of Appeals reversed the lower court’s summary judgment in favor of the City, and determined that the case should move forward to trial, on the basis that a jury could find that the collective treatment could rise to the level of hostile environment. Anna M. Hall v. City of Chicago, 7th Cir., No. 11-3279, March 29, 2013.

In 1999, Anna Hall, a plumber for the City of Chicago, began a lengthy disability leave due to a work-related injury. Hall returned to work in 2003 with a 25-pound lifting restriction, and was unable to resume working as a plumber. The City then assigned Hall to light duty in the House Drain Inspectors Division of the City’s Department of Sewers, where she was supervised by Gregory Johnson, the Division supervisor. Johnson assigned Hall to alphabetize various files for several weeks and, in fact, gave her the same files over and over again. A few weeks later, Johnson did the same with reviews of drainpipe videos, on which Hall took notes which were never read – as Johnson already had reviewed the videos and taken his own notes prior to having Hall undertake the task. After several weeks, Hall complained to the department’s personnel director about the assignments, who dismissed the complaints and allegedly called Hall a “trouble maker” in the process.

In addition to assigning the menial work, Johnson prohibited the other Division employees from speaking to Hall, ultimately excluding her from meetings, and precluding her from taking on additional responsibilities within the group. Johnson also directed anger towards Hall in other ways, making comments – overheard by Hall – that he “could slap that woman and get a promotion” and that he might “go postal on that woman.” On one occasion early in 2004, Johnson purposely bumped into Hall, after which Hall contacted the police, the union, and her lawyer, and ultimately filed a Violence in the Workplace Report with the City. Eight days after that Report, a written reprimand was issued to Johnson.

Hall continued to do the assignments given to her by Johnson until 2005, when she left the Division and filed a lawsuit, alleging that Johnson discriminated and retaliated against her, and that the City failed to promote her in retaliation for her complaints. The lower court entered summary judgment against Hall, dismissing the complaint. On appeal, Hall pursued only her hostile work environment claim. The Seventh Circuit reversed the lower court’s decision, and remanded the case for further proceedings on that claim.

Title VII makes it unlawful to treat an employee differently because of a protected characteristic, including gender. To survive summary judgment on her Title VII hostile work environment claim, Hall had to provide evidence that the alleged harassment was severe or pervasive, that the hostile conditions were because of her sex, and that the company should be held liable for Johnson’s actions. The Seventh Circuit determined that Hall had done all three.

First, the Court stated that it was improper to “carve up the incidents of harassment and then separately analyze each incident, by itself, to see if each rises to the level of being severe or pervasive.” Instead, the Seventh Circuit looked at the totality of the circumstances and found that a jury could conclude that Johnson’s ongoing conduct was designed to ostracize Hall from the rest of the Division.

Next, while admitting that this was a “close” case, the Court found enough evidence in the record from which a jury could infer that Johnson was motivated by Hall’s gender. That evidence consisted largely of Johnson’s references to “that woman” in his remarks about Hall. It is of note that Hall was not the only woman in the Division - Johnson’s secretary also was female. However, the Court pointed out the fact that Hall was in a “traditionally male role” (that of plumber), while the secretary was not, and referred to research on gender stereotyping.

Third, Hall was able to proffer sufficient evidence on which a jury could base a finding of liability against the City. While the City took prompt action after Hall’s Violence in the Workplace Report, the record also showed that Hall first raise her concerns about her assignments a few weeks into her light duty position, but allegedly was met with the statement that Hall was a “trouble maker.” Further, Hall’s report to the union and to the police of the bumping incident in 2004 provided sufficient notice to the City of the issues related to Johnson’s actions.

It is important to understand that the Seventh Circuit’s holding is not an ultimate determination of Hall’s hostile environment claim. However, it does indicate that courts are likely to: (1) view hostile work environment complaints through a broad lens, looking at the totality of the circumstances to determine whether behavior is “severe or pervasive”; (2) interpret remarks that include references to gender (“that woman”) as an indication that the remark was made because of the sex of the person being mentioned; and (3) assume that a jury may find a company liable if prior complaints have been made without some active response. In addition, the case is a warning to employers regarding the supervision of individuals on “light duty” and a directive to assure that company anti-discrimination policies are enforced for those employees, even though they are in positions other than their own.
 

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A federal district court in Ohio has refused to dismiss a complaint for religious discrimination made by a hospital employee after the employee was fired for refusing to be vaccinated for the flu. The basis of the refusal to be vaccinated was the employee’s veganism. The Court denied the employer’s motion to dismiss, holding that the plaintiff’s beliefs were sincerely held and, therefore, merited protection under the law. Chenzira v. Cincinnati Children’s Medical Center, S.D. Ohio, No. 1:11-cv-00917 (12/27/12).

Sakile Chenzira, a confirmed vegan, was employed by Cincinnati Children’s Medical Center (“CCMC”) as a Customer Service Representative for over 10 years. A vegan does not ingest any animal or animal by-products. Until 2010, Chenzira was allowed to forego a flu vaccine, which included animal by-products, without disciplinary action being taken against her. In 2010, when Chenzira refused the mandatory vaccine, she was fired. In response, she filed a charge of religious discrimination with the EEOC, and ultimately filed a lawsuit in federal court alleging religious discrimination, along with a related state claim for violation of public policy. CCMC filed a motion to dismiss the complaint, arguing that veganism is not a religion. That motion was denied (although the hospital’s motion to dismiss the state law public policy claim was granted).

A motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6) requires a court to determine whether a “cognizable claim” has been pled in a complaint. A plaintiff’s complaint survives such a motion if it contains sufficient factual matter that, if accepted as true, states a plausible claim to relief. In response to CCMC’s argument that Chenzira’s veganism was simply a “social philosophy or dietary preference,” the Court pointed out that Chenzira’s claim was supported by the EEOC’s regulations, which state that “religious practices” include moral or ethical beliefs as to what is right and wrong which are “sincerely held with the strength of religious views.” Further, Chenzira provided to the Court an essay entitled “The Biblical Basis of Veganism,” and cited Biblical passages in support of her claims.

The Court found that in the context of a motion to dismiss, Chinzera set forth a “plausible” claim that she ascribes to veganism with a sincerity equating that of traditional religious views.  (In a largely unsuccessful attempt to clarify that characterization, the court pointed out that “plausibility” falls “somewhere between probability and possibility.”)  In addition, the fact that Chinzira previously had been exempted from the vaccine, along with the EEOC regulations which make it clear that “it is not necessary that a religious group espouse a belief before it can qualify as religious,” helped to support the Court’s decision that it was inappropriate to dismiss Chinzera’s claims for religious discrimination under Federal Rule 12(b)6).

This case was decided on specific facts, and does not create a new category of “religious beliefs,” nor does it mean that veganism must be accommodated in every circumstance.  Importantly, the Court added a comment in its opinion that may be critical to the ultimate outcome of the case: “The Court’s ruling in no way addresses what it anticipates as [CCMC’s] justification for its termination of [Chinzera], the safety of patients at Children’s Hospital.  At this juncture, there is simply no evidence before the Court regarding what, if any, contact [Chinzera] might have with patients, and/or what sort of risk her refusal to receive the vaccination could pose in the context of her employment.”  Here, the Court simply ruled on the sufficiency of the religious discrimination claim filed by Chinzera, finding that she alleged beliefs that may deserve legal protection.  The decision is not a determination on the merits of the claims or the defenses.
 

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Neither Title VII of the Civil Rights Act nor the Americans with Disabilities Act (ADA) specifically prohibits discrimination against individuals who may be victims of domestic or dating violence, sexual assault, or stalking. However, a recent fact sheet/guidance issued by the Equal Employment Opportunities Commission (EEOC) has employers scrambling to update anti-discrimination training to reflect the examples listed in that guidance, and to make managers aware of circumstances under which such individuals might be the targets of discrimination under those federal statutes. While discrimination in a particular situation must be determined through a case-by-case analysis of the facts, the EEOC sets forth numerous examples involving domestic violence and sexual assault victims, and which include disparate treatment, harassment and retaliation scenarios under both Title VII and the ADA.

The examples of employment scenarios that may violate Title VII include: an employer’s decision to terminate an employee who was subjected to domestic violence because of fears related to the “drama battered women bring to the workplace” (disparate treatment); a supervisor who learns that an employee recently was subjected to domestic abuse and, viewing her as vulnerable, begins to make sexual advances toward her (harassment); and an employee who, subsequent to filing a complaint alleging that she was raped by a manager while on a business trip, is reassigned to less favorable projects (retaliation).

Examples of decisions that may violate the ADA are similarly varied and, in most cases, straightforward. They include: an employer who learns that an applicant was a witness in a rape prosecution and received counseling for depression, and decides not to hire her because she may need time off for further treatment of that depression (perceived disability); a supervisor who tells an employee’s co-workers about the employee’s PTSD resulting from incest (disclosure of confidential information); and an employee who tells her supervisor that she is going to complain about his dissemination of her medical information, and is told that if she does, she will not get a pay raise (retaliation).

However, the examples also include one scenario that may not immediately strike employers as a clear ADA violation: an employee who has no accrued sick leave and is not eligible for FMLA requests a scheduling change or an unpaid leave in order to get treatment for depression following a sexual assault during a home invasion, but is denied that leave because the company “applies leave and attendance policies the same way to all employees.” Because most employers typically are reminded by both HR and legal that employees should be treated in a consistent manner, and that individuals in protected categories should not be treated differently than non-protected similarly situated individuals, this scenario may not seem to be an obvious example of an ADA violation. However, a reasonable accommodation is a change in the way things usually are done and can include modified work schedules, reassignment to a vacant position, or time off for medical treatment. This last scenario clearly indicates that the EEOC has an expectation that employers will change their consistently applied leave and attendance policies, if such change is necessary to accommodate the need for psychological treatment stemming from an incident of sexual assault or domestic violence.

Employers should, in fact, begin to add the issues raised in the EEOC’s recent guidance to the anti-harassment and non-discrimination training that is provides to managers and supervisors, in order to avoid inadvertent violation of Title VII or the ADA. Fortunately, the EEOC’s Q&A format provides clear examples that easily can be incorporated in such training.

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One of the issues most frequently litigated in employment cases is whether the remarks and actions of an employer rise to the level of the “hostile work environment” needed to support a claim of discrimination. The 10th U.S. Circuit Court of Appeals recently addressed that issue, and provided at least some clarity to the definition, adding its voice to the courts that have held that racial epithets directed at employees other than the plaintiff, and non-racial adverse actions directed at that plaintiff, both can be considered as elements of a hostile work environment if other evidence of racial animus is present. Hernandez v. Valley View Hosp. Assn., 10th Cir., No. 11-1244, June 26, 2012.

Teresa Hernandez, a Latina of Mexican heritage, was hired by Valley View Hospital Association in 2001, and began working in the food service department at that time. Beginning in 2004 and 2005, Hernandez was supervised Marc Lillas and Nicholas Stillahn, a duo of supervisors whose actions form the basis of Hernandez’s federal court complaint.

Hernandez alleges that during a fourteen month period of her employment, beginning in 2006, she was the target of a number of remarks by her supervisors based on her heritage, and that she had experienced certain incidents of non-racial derogation. Hernandez frequently complained directly to Lillas and Stillahn that she felt that the remarks were racist and demeaning. On July 20, 2007, Stillahn angrily yelled at Hernandez about the status of the cafeteria, then shoved a food cart and kicked a door in response a statement by Hernandez’s that “maybe I’m not white enough” for Stillahn. Hernandez was then suspended for that remark, and asked to be reassigned from the food service area. Her request for reassignment was denied, but Valley View’s Director of Human Resources, Daniel Biggs, offered to allow Hernandez to take FMLA leave until October 15, 2007, which Hernandez accepted. On October 12, Biggs met with Hernandez to discuss with her certain performance concerns by her supervisors that had not previously been “formally documented.” Hernandez again asked for a transfer from food services, and Biggs again denied the request. When Hernandez failed to return from her FMLA leave, her employment was terminated.

After exhausting her administrative remedies, Hernandez filed a complaint in federal court, which included racial and national origin discrimination claims based upon a hostile work environment, and a claim for constructive discharge. Valley View’s motion for summary judgment was granted by the lower court, and Hernandez appealed to the Tenth Circuit. The appellate court reversed the lower court’s decision, reinstating Hernandez’s hostile work environment and constructive discharge claims.

The lower court characterized Hernandez’s evidence as “a handful of racially insensitive jokes and comments over a period of more than three years.” However, the Tenth Circuit, while recognizing that “Title VII does not establish a general civility code for the workplace,” and that “boorish, juvenile, or annoying behavior” is insufficient to support a claim of hostile environment, found that there is not a “mathematically precise test” for a hostile work environment claim and that the term “pervasive” is not a “counting measure” that can be viewed in a vacuum. It found, instead, that Hernandez experienced more than a “handful” of “sporadic” racially derogatory jokes and comments, and that Hernandez was able to articulate at least twelve instances of racial remarks by her supervisors within a 14 month period within which Hernandez also had suffered behavior and remarks that, while arguable non-racial, had subjectively offended her to the point where she formally complained about that behavior.

The Tenth Circuit held that, viewing the records as a whole and in a “broader contextual analysis,” a reasonable jury could find that the workplace was “permeated with discriminatory intimidation, ridicule, and insult that was sufficiently severe or pervasive to alter the conditions of her employment,” and reversed the lower court’s decision, sending the case forward to be heard by a jury.

While the Tenth Circuit’s opinion arguably is limited to court decisions within a particular geographic area (the Tenth Circuit encompasses Colorado, Kansas, New Mexico, Oklahoma, Utah, and Wyoming), the rationale articulated by the Court in this case provides broader guidance to all employers. First, every supervisor must be trained to respond to complaints regarding discrimination, whether or not the supervisor agrees with the employee’s characterization of the behavior as illegal or inappropriate. To ignore such reports risks legal liability for harassment, hostile environment, or -- when the employee ultimately is fired -- constructive discharge. In addition, employers cannot assume that because the incidents allegedly suffered by an employee are few, that a court necessarily will agree with the employer’s characterization of those incidents as “sporadic” or not pervasive enough to support a Title VII cause of action. Lastly, simply because discriminatory remarks are not directed at a complainant, or because the behavior directed toward a complainant arguably is not based upon a protected characteristic, an employer cannot assume that such remarks or behavior will not become part of the complainant’s lawsuit. Here, because other evidence of racial animus existed, the Court viewed epithets directed at others, and incidents of “non-racial’ abusive behavior toward Hernandez as supportive of Hernandez’s claims of hostile work environment.
 

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Most employers understand that Title VII of the Civil Rights Act precludes a discriminatory “hostile work environment,” in which acts of discrimination against an employee are so severe and pervasive that those acts have an adverse impact on the employee’s ability to do his or her job. What is less fully understood is the fact that an employee also can bring an action under Title VII based upon severe and pervasive retaliatory acts that follow a “protected action” taken by the employee. The 11th U.S. Circuit Court of Appeals -- the last appellate circuit to formally recognize such a cause of action -- recently joined its sister circuits, recognizing a retaliatory hostile environment claim brought by two physicians who had filed EEOC claims against the VA hospital and medical center by which they were employed. Gowski, et al v. Peake, et al, 11th Cir., No. 09-16371, June 4, 2012.

Doctors Diane Gowski and Sally Zachariah were employed at Bay Pines Veteran’s Affairs (VA) hospital and medical center in Florida. In August 2007, Gowski and Zachariah, along with two other individuals, filed a complaint in federal court against the Secretary of the Department of Veteran’s Affairs, alleging that the hospital’s administration retaliated against them after they each had filed internal complaints of discrimination in 2005 and 2006. At trial, the doctors alleged that the managers and administrators at Bay Pines made a “concerted effort” to retaliate against employees who “opposed their discriminatory or retaliatory actions.” To support that claim, the doctors provided evidence that administrators targeted such individuals by spreading rumors about them, soliciting adverse reports about them from other employees, and warning others that the VA “would not settle frivolous complaints and lawyers would not run the hospital.”

The list of alleged adverse actions against Gowski and Zachariah was extensive, including loss/limitation of practice privileges, misleading/mistaken reports of disciplinary action in personnel files, unwarranted verbal counseling, decrease in salary, and removal from committee positions. The case proceeded to trial, after which the Secretary moved for judgment as a matter of law. That motion was denied, and the jury determined that Gowski and Zachariah had experienced a retaliatory hostile work environment, awarding to Gowski $250,000 in emotional damages and $16,000 in lost wages, and to Zachariah, $1,000,000 in emotional distress and $90,000 in list wages. The Secretary filed post-trial motions including an argument that discrete acts of retaliation could not form the basis of a claim for retaliatory hostile work environment. The trial court denied that motion, and an appeal to the Eleventh Circuit followed.

Upon review, the Eleven Circuit for the first time recognized a cause of action for retaliatory hostile work environment. It based that determination on the language of Title VII, and the EEOC’s own interpretation of the statute. Further, it found that prohibition of a retaliatory hostile environment is consistent with Title VII’s remedial goal of preventing supervisors from deterring protected conduct. (During trial of the matter, there was testimony that certain doctors left the hospital rather than report discrimination and then continue to work in fear of retaliation.)

Employers generally understand that discrete acts cannot, by themselves, cannot form the basis of a claim of discriminatory hostile work environment. Therefore, an employee’s termination, her denial of transfer, or a refusal to hire does not typically support such a claim. Instead, such claims are based upon acts whose very nature involves repeated conduct: intimidation, ridicule, or repeated insult. The Eleventh Circuit analyzed the claims made by Gowski and Zachariah under that same framework, and found that repeated acts of intimidation and ridicule that followed the doctors’ protected claims of discrimination in 2005 and 2006, and that were severe and pervasive enough to alter the doctors’ working conditions, could support claims of "retaliatory hostile work environment."

The message in this case is not a new one, but is important nonetheless. Individuals who take actions protected by Title VII, specifically including an internal report of workplace discrimination, cannot be retaliated against for that report. In addition, subjecting such an employee to a “thousand small cuts” in the hope that he or she will decide to leave employment can lead to liability for a retaliatory hostile work environment.
 

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The Equal Employment Opportunity Commission (EEOC) has issued an updated Enforcement Guidance on the Consideration of Arrest and Conviction Records in Employment Decisions under Title VII. That Guidance, which takes effect immediately, is a compilation of the past policy documents and prior court decisions regarding the EEOC’s position that employers’ reliance on arrest and conviction records may have a negative impact on individuals because of race or national origin. According to the Guidance, Title VII violations may occur during background checks in two ways: (1) “disparate treatment,” when employers treat applicants/employees differently, making distinctions between employees of different races based on the employer’s subjective judgment as to the relative severity of past convictions; and (2) “disparate impact,” when an employer’s neutral background check policy or practice disproportionately affects individuals in a protected category. The Guidance focuses largely on "disparate impact" type discrimination.

When viewing an employer’s decision for disparate impact, the EEOC first identifies the policy or practice causing the alleged disparate impact. The EEOC then has the burden of showing an actual disparate impact on a protected group, using statistical evidence. Employers should be prepared for increased requests from the EEOC for applicant and hiring data on this account. Once the EEOC has established the existence of a disparate impact, the employer may assert an affirmative defense stating that its background policy or practice is job related and consistent with business necessity. Importantly, the EEOC reiterates in the Guidance a position that it has put forth in numerous past cases, that an arrest, without more, can never be “job-related and consistent with business necessity” because an arrest does not establish that criminal conduct has occurred. Under our criminal justice system, individuals are presumed innocent until proven guilty, and an arrest does not necessarily lead to a conviction establishing guilt. Therefore, employers should not make hiring decisions based solely upon arrest records.

The EEOC identifies two circumstances in which an employer can establish the "job-related and consistent with business necessity" defense. The first requires a validation study or an analysis of criminal conduct as related to subsequent work performance or behaviors, an esoteric standard which most private employers will not readily be able to meet. The second, however, is more accessible, although more time consuming and effort intensive. It involves a “targeted screening process’ for all applicants that sets parameters for the nature and gravity of offenses or conduct; the amount of time that has passed since the offense, conduct, and/or completion of the sentence; and the nature of the job held/sought. Once a group of applicants has been screened using these factors, each of those applicants then should be allowed an individualized review of his or her specific criminal background issue. The Guidance establishes a de facto requirement for individualized screening of applicants and candidates by stressing that an employment screening process that does not include individualized assessments is more likely to violate Title VII.

In its general “Best Practice” summary, the EEOC lists only two points. The first, an instruction to “train managers, hiring officers, and decisionmakers about Title VII and its prohibition on employment discrimination” will be familiar to employers as something that HR and legal advisors typically suggest. The second point, however, a directive to “eliminate policies or practices that exclude people from employment based on any criminal record,” is more problematic. According to Jay Glunt, shareholder in Ogletree Deakins’ Pittsburgh office, this one-line directive is certain to raise some concern among employers, especially in light of recent developments in “Ban-the-Box” legislation in various states and municipalities. Without additional guidance and detail, this statement indicates that the EEOC will not look favorably on any exclusionary policies, whether or not legislatively precluded. Therefore, employers must assure that any exclusion of applicants on the basis of criminal background is clearly “job-related and consistent with business necessity” to avoid negative attention from the EEOC.

The EEOC has posted a Question & Answer summary of the Guidance for public view. 

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The anti-discrimination provisions of Title VII of the Civil Rights Act apply only to employees. The determination of whether an individual is an “employee” for purposes of that Act depends largely on whether a putative employer exercised control over the manner and means by which the individual performed a job. While most employers assume that an employee who is hired as an “independent contractor” does not work under such control, one federal appeals court recently determined that a hospital’s quality assurance program that led a physician, who was hired as an independent contractor, into its peer review process may have created an employment relationship, allowing the physician to move forward with claims under Title VII. Salamon v. Our Lady of Victory Hospital, W.D.N.Y., No. 1:99-cv-48, 4/3/12.

In 1999, Dr. Barbara Salamon, a board certified gastroenterologist and internist with medical staff privileges at Our Lady of Victory Hospital (“OVH”) in New York State, filed a lawsuit against that hospital and four individuals, claiming that she had been discriminated against on the basis of her gender. According to Salamon, one of the individual defendants sexually harassed her and made unwanted advances. When Salamon complained about that behavior, she allegedly received undeserved negative performance reviews. Salamon also claimed that the remaining defendants were complicit when they used the hospital’s peer review process to punish her for reporting the harassment.

The Defendants in the case moved for summary judgment in 2001. After discovery and arguments, a decision was issued by the lower court in 2006, and the motion was granted, based on the lack of an employee-employer relationship. In 2008, the 2d U.S. Circuit Court of Appeals vacated that judgment and remanded the case for further consideration. Salamon v. Our Lady of Victory Hospital, et al., 514 F.3d 217 (2d Cir. 2008). Specifically, the Second Circuit asked the lower court to again review the status of the relationship between Salamon and OVH to determine whether Salamon was an “employee” for purposes of Title VII.

The hospital did not pay a salary or other monetary compensation to Salamon; she billed patients and insurers directly for her services. In addition, however, Salamon’s clinical privileges extended to the use of the hospital’s facilities and equipment in the GI lab, both of which were vital to her practice. Importantly, Salamon was required to submit to the hospital’s “Staff Rules and Regulations.” One significant piece of hospital supervision over Salamon was a “quality assurance” process under which hospital practitioners, on a rotating basis, would review procedures conducted by various physicians at the hospital. Cases flagged as “problematic” under the process would be discussed further. Doctors whose cases were flagged would be subject to a peer review and, if appropriate, reported to the National Practitioners Data Bank (NPDB).

Salamon alleged that her relationship with the hospital changed and the level of review of her practice changed significantly after she complained of unwanted sexual attention. Her cases began to be reviewed regularly and criticized to an extent substantially greater than other (male) doctors’ cases. As a result of these reviews, Salamon was ordered to undergo a three-month “re-education” and mentoring program. Salamon was warned that her failure to complete the program would lead to a report to the NPDB.

In re-considering the facts of the case on remand, the district court’s primary focus was on whether Salamon was an independent contractor or an employee. To make that determination, the court looked to the U.S. Supreme Court’s decision in Community for Creative Non-Violence v. Reid, 490 U.S. 730 (1989). In that case, the Supreme Court set forth thirteen factors that should be considered: (1) the hiring party’s right to control the manner and means by which the product is accomplished; (2) the skill required; (3) the source of the instrumentalities/tools; (4) the location of the work; (5) the duration of the relationship; (6) whether the hiring party can assign additional projects to the hired party; (7) the extend of the hired party’s discretion over when/how long to work; (8) the method of payment; (9) the hired party’s ability to hire/pay assistants; (10) whether the work id part of the regular business of the hiring party; (11) whether the hiring party is in business; (12) the provision of employee benefits; and (13) the tax treatment of the hired party. While no single factor is dispositive, the primary emphasis is put on the first factor – the extent to which the hiring party controls the manner and means by which the worker completes her tasks.

While policies that merely reflect professional and governmental regulatory standards may not create the level of control that establishes an employment relationship for purposes of Title VII, the evidence submitted by Salamon indicated that the policies imposed upon her, and the imposition of the peer review process on her cases to such a large degree, may have been motivated by the hospital’s goal of maximizing revenue, and/or in reaction to Salamon’s complaints of harassment. Because a reasonable fact finder could conclude that the hospital’s quality assurance standards extended beyond health and safety concerns or to Salamon’s specific medical qualifications, and because Salamon was subject to possible negative peer review for violation of those standards, Salamon was able to demonstrate a genuine factual conflict regarding the extent of control exercised by the hospital over her performance. Therefore, the lower court’s decision was reversed, allowing the Title VII and related state claims to go forward to a jury.

Employers -- especially hospital and heath system entities -- should be aware of this decision, and should become familiar with the 13 factors set forth by the Supreme Court for use in reviewing these circumstances. Primarily, employers must recognize that the degree of control exercised over the work performance of individuals, if not established for reasons related to the quality of the service provided, can re-categorize an independent contractor into an employee for purposes of Title VII liability.
 

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It is generally understood that employees can bring Title VII claims – and be awarded damages - for hostile environment, wrongful termination, and retaliation. What is less clearly understood is the extent of the economic damages for which a former employer may be liable in the situation in which a litigant claims to have lost a job opportunity because of a retaliatory action on the part of that former employer. The 5th U.S. Circuit Court of Appeals recently answered that question by quoting the wording of Title VII, and holding that the law “does not require that the employer liable for back pay be the same entity for whom the plaintiff would have worked had he not suffered unlawful retaliation.” Nassar v. Univ. of Texas Southwestern Medical Center at Dallas, 5th Cir., No. 11-10338, 3/8/12.

Naiel Nassar, a U.S. citizen since 1990, was born in Egypt and attended medical school there. He subsequently did a medical residency and a fellowship in infectious diseases at the University of California, Davis. In 2001, Nassar was hired by the University of Texas Southwestern Medical Center (UTSW) as an Assistant Professor of infectious disease medicine. Part of Nassar’s duties required that he provide patient care at Parkland Hospital’s Amelia Court clinic, an outpatient HIV/AIDS clinic affiliated with UTSW.

In 2004, UTSW hired Dr. Beth Levine as the chief of its infectious disease program. In that role, Levine directed that Nassar begin billing for the services he provided to the HIV clinic. Nassar objected to the directive, arguing that his salary for clinical services was fully funded by a federal grant, and stating that billing the patients therefore would be “double dipping.” Nassar claimed that Levine then began to “harass” him, making derogatory statement about his race and his Muslim religion, including one comment that “middle easterners were lazy.” His allegations were supported by a clinical supervisor, whose affidavit described a “disconnect between Dr. Levine’s [derogatory] statements and the reality of Dr. Nassar’s work.” Based on his concerns about Levine, Nassar ultimately applied for direct employment by Parkland Health & Hospital System in 2006. Parkland made preparations to hire Nassar, drafting a letter offering a staff physician job to Nassar. However, the offer was later withdrawn. Nassar contended - and testimony supported the claim - that UTSW retaliated against him by blocking the offer from Parkland because Nassar stated in his resignation letter that his primary reason for leaving UTSW was Levine’s harassment and discriminatory comments. Nassar ultimately accepted a job in a smaller clinic in Fresno, California, and filed a lawsuit against UTSW in federal court alleging discrimination/constructive discharge and retaliation.

At trial, the jury was presented with only two questions: (1) Whether Nassar was constructively discharged because of his race, national origin, or religious preference; and (2) Whether UTSW retaliated against Nassar by blocking or objecting to his employment by Parkland after Nassar complained about his treatment at UTSW. After one hour of deliberations, the jury answered “Yes” to both questions. Two days after the May 24, 2010 verdict, the same jury awarded $3.2 Million in compensatory damages and $438,000 in lost back pay to Nassar. The trial court reduced the compensatory damage award to $300,000 under the Title VII damage cap, but added nearly $500,000 in attorney fees and costs to Nassar’s award. Both sides appealed the awards.

Upon review, the Fifth Circuit reversed the verdict against UTSW on Nassar’s constructive discharge claim, holding that while the evidence that Nassar provided to the jury may have supported a claim of hostile environment, that evidence did not rise to the level of egregious conduct necessary to support a claim of constructive discharge. However, the Court upheld the jury’s verdict on the retaliation claim, and further upheld the method used by the jury to calculate Nassar's lost income.

While UTSW argued that Nassar’s lost income should have been the difference between that which he was earning at UTSW ($166,395 as an Assistant Professor) and his subsequent compensation in California (which varied from $165,000 to $180,000 a year, including benefits), the district court allowed the jury to calculate the lost pay by comparing Nassar’s prospective income from Parkland ($240,500 a year, including benefits) to the amount that he was earning in California. Using that method, the jury awarded Nassar $436,167.66 in lost back pay. The Fifth Circuit upheld that award because it made Nassar whole by placing him in the position that he would have been in “but for” the retaliation.

This case is a strong reminder that unlawful retaliation can take the form of a former employer preventing an individual from getting a job with another employer. Under Title VII, lost income is payable by the employer responsible for the unlawful employment practice, and may be calculated as the difference between the individual’s former pay, and that which he would have earned had the retaliation not occurred.  If, as in this case, evidence indicates that the retaliation kept the individual from moving to a more highly lucrative position, the former employer risks being liable for the loss of a substantially higher wage.

In addition, employers – especially hospital and healthcare entities that are contemplating direct hiring of physicians - should understand that an employee, or former employee, can successfully prove retaliation without having successfully proven discrimination or a constructive discharge claim, and that damages for lost pay and benefits for highly compensated individuals can be substantial.
 

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Title VII of the Civil Rights Act makes it an unlawful employment practice for an employer to discriminate against “any individual" on the basis of membership in a protected class. In a reminder to employers, the 4th U.S. Circuit Court of Appeals has reiterated the generally accepted interpretation that in this language, Title VII explicitly allows former employees, as well as current ones, to bring an action under that statute. Gerner v. County of Chesterfield, 4th Cir., No.11-1218, 3/16/12.

Karla Gerner was employed by Chesterfield County, Virginia, for over 25 years, with twelve of those years as the County’s Human Resources Director. In 2009, Gerner was informed that her job was being eliminated due to a reorganization of the department, and was told that she was entitled to three months of pay and benefits as a severance, if she would resign and sign a waiver of legal claims against the County. Gerner ultimately declined that offer and was fired, effective December 15, 2009.

Gerner filed a lawsuit, alleging that certain male counterparts – also former directors of County departments – had received “sweetheart” deals of up to six months of pay and benefits, or were placed into positions with less responsibility while continuing their prior pay, in order to allow them to “enhance their retirement benefits.” The district court granted the County’s motion to dismiss Gerner’s complaint, holding that the terms and conditions of the severance package did not constitute an adverse employment action. That court found that the County’s offer of a “less favorable severance package" did not constitute an adverse employment action for two reasons. First, the court held that severance benefits must be a "contractual entitlement" to provide the basis of an adverse employment action under Title VII; and second, the court held that because the offer of the severance package was made after Gerner had been terminated, it could not constitute an adverse employment action.

The Fourth Circuit reversed that decision on both grounds. First, it cited the U.S. Supreme Court’s holding in Hishon v. King & Spalding, 467 U.S. 69 (1984), which precludes the argument that an employment benefit must be a contractual right in order for its denial to provide the basis for a Title VII claim. In Hishon, the Supreme Court held that any "benefit that is part and parcel of the employment relationship may not be doled out in a discriminatory fashion, even if the employer would be free under the employment contract simply not to provide the benefit at all." The Hishon Court clearly stated that benefits that an employer is under no obligation to furnish by any express or implied contract may qualify as a “privilege” of employment under Title VII, and may provide the basis for a Title VII claim, as long as the benefit is "part and parcel of the employment relationship." In Gerner’s situation, in which she did not voluntarily ask for removal from her position, but was offered the severance in return for resignation and a release of claims, the severance was deemed to be the required “part and parcel” of the relationship.

The Fourth Circuit addressed the district court’s holding that Gerner did not suffer an adverse action because she was terminated before being denied the severance, and found that rationale lacking, as well. The Court pointed to the language of Title VII, protecting “any individual,” and again cited to the Supreme Court’s opinion in Hishon (“A benefit need not accrue before a person’s employment is completed to be a term, condition, or privilege of that employment relationship") to support the fact that an employment benefit can constitute an adverse action, even if it related to a former employee. According to the fourth Circuit, to limit actionable adverse employment actions to those taken while an individual is currently employed would be inconsistent with Title VII’s “principal goal” of "eliminat[ing] discrimination in employment."

While most employers, if asked, would say that an individual’s severance is related to that person’s employment, and would recognize that denial of or unequal benefits could constitute an adverse employment action supporting a Title VII claim, the Fourth Circuit opinion leaves no room for doubt: former employees can bring a claim for issues related to their separation from employment, including a claim based upon the terms of any offer of severance.
 

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Remarks by a law firm’s human resources director could be “direct evidence” of pregnancy discrimination and violation of the FMLA, according to the 7th U.S. District Court of Appeals. According to the court, such evidence falls outside of the “hearsay” objection that might otherwise keep it from being presented to a jury. Makowski v. SmithAmundsen LLC, 7th Cir., No. 10-3330, November 9, 2011.

Lisa Makowski was employed as Marketing Director for the SmithAmundsen law firm between January 2005 and her termination in February 2008. During her employment, Makowski received annual salary increases and discretionary bonuses based on her performance. In the summer of 2007, Makowski informed the firm’s management that she was pregnant. She requested, and was granted, leave under the Family and Medical Leave Act. Between November 5 and November 25, Makowski worked from home with the firm’s permission, as she had been placed on bed rest by her obstetrician. She began her FMLA leave on November 26, and gave birth on December 2.

In January 2008, the firm’s Executive Committee conducted its firm retreat, at which it annually assessed the overall structure of the firm to determine whether staffing changes were necessary. At that retreat, the Executive Committee decided to terminate Makowski and to move another individual into the leadership position with the Marketing Department. After that meeting, the Committee informed the firm’s Human Resources Director, Molly O’Gara, that Makowski didn’t “fit into our culture,” and asked O’Gara to consult with outside counsel to discuss the implementation of Makowski’s firing.

On February 4, 2008, while Makowski was still on maternity leave, her employment was terminated over the telephone. In that conversation, Makowski was told that her position was being eliminated as part of an organizational restructuring. Later that day, Makowski came into the office to pick up her personal belongings. According to Makowski, as she was leaving the office, she was met by O’Gara, who told her that the actual reason for the termination was because of Makowski’s pregnancy and FMLA leave, and that the same thing had happened to several other women employees in the past. O’Gara allegedly suggested to Makowski that she should speak to a lawyer about a possible class action on the issue.

Makowski filed a lawsuit on December 2, 2008, alleging violations of both the Pregnancy Discrimination Act and the Family and Medical Leave Act, and cited O’Gara’s alleged remarks as direct evidence of discrimination. The firm moved for summary judgment, and the motion was granted, based on the fact that because O’Gara had not been directly involved in the decision to terminate Makowski, her statements concerning the termination were inadmissible hearsay. Without those statements, Makowski lacked evidence of the connection between her termination and any discriminatory acts by the firm.

On appeal, the Seventh Circuit reversed that decision. It found that because O’Gara’s statements concerned a matter within the scope of her duties as HR Director, they fell within an exception to the hearsay rule. Essentially, that exception means that the agent acting within the scope of his or her employment with the company speaks on behalf of the company and that, therefore, his or her statement is actually a party admission that can be used to support a claimant’s case. Here, O’Gara’s alleged comments to Makowski fit within the scope of O’Gara’s duties as an HR Director who was involved in the firm’s hirings and firings. Further, the court pointed out that O’Gara’s discussions with outside counsel at the request of the Executive Committee could actually support an argument that O’Gara was directly involved in the final decision to fire Makowski, since the Committee waited for the counsel’s imprimatur before implementing the termination.

This case sets out an important lesson for employers and underscores the need for training for managers, supervisors, and HR personnel, especially with respect to having the difficult conversations needed for disciplinary and termination meetings. The importance of the use of “talking points” for disciplinary and termination meetings cannot be overstressed. Any remarks outside of pre-established, pre-rehearsed talking points could be used – as in this case – to argue to the jury that the “official” reason given for the adverse action was simply a pretext for discrimination.
 

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The Pregnancy Discrimination Act (PDA) requires employers to treat pregnant employees in the same manner as other employees who are not pregnant, but who are similarly situated in their ability or non-ability to work. That means that under the PDA, a woman who is unable to work because of pregnancy-related illness is entitled to sick leave or benefits only on the same basis as employees who are unable to work for other reasons. Based on that rationale, a part-time salesperson recently was unable to convince the 10th U.S. Circuit Court of Appeals that she was denied leave and later fired on the basis of her pregnancy. Anderson v. The Cato Corporation, 10th Cir., No. 11-3003, October 27, 2011.

Because the Tenth Circuit was reviewing a summary judgment ruling, it was required to view the evidence in the light most favorable to Anderson, assuming her asserted facts to be true. In February 2008, Cynthia Anderson began her employment as a part-time sales associate with The Cato Company. After a few months, the company was considering her for a full-time assistant manager position. On April 9, 2008, Anderson discovered that she was pregnant; she informed the company on the following day. Anderson then asked for "couple of days off" to get some mediation for her nausea. According to Anderson, the store manager seemed "okay" with that request. However, Anderson claimed that she called on April 15 to inform the store manager that she had been admitted to the hospital and would need additional time off, and was told that she had been terminated from her associate position, but that the store manager would attempt to hold open the assistant manager position for her. Later that week, when Anderson called again, she claimed that she was told that the assistant manager position had been awarded to another employee.

According to Cato’s records, Anderson’s personnel records indicate a "voluntary termination" because of "complications with Pregnancy." The Recommended for Rehire box on the form was checked as "Yes." Anderson never sought to be rehired by Cato.

Because she planned to apply for unemployment compensation and public assistance, Anderson requested from Cato a letter setting forth the reasons for her termination. In response, a store manager wrote that Anderson was terminated "due to pregnancy related illnesses." The letter went on to explain that Anderson, who had only worked for the Company for two months, was not eligible for leave under Cato’s policies.

Anderson filed a legal action under the PDA, arguing that the company’s letter was direct evidence of a violation of that Act. However, the lower court granted Cato’s motion for summary judgment, holding that Cato terminated Anderson’s employment because she was unable to work and was not entitled to leave. That decision was upheld by the Tenth Circuit on Appeal.

The Tenth Circuit first determined that Cato’s written statement regarding the reason for Anderson’s termination was not direct evidence of discrimination. It based that determination on the fact that the letter was not an admission of illegal activity, but was an explanation of the fact that Anderson needed leave to which she indisputably was not entitled. It then went on to say that Anderson failed to proffer any evidence that Cato’s policy of terminating employees who needed extended leave to which they were not entitled, then offering to hire them back when they were able to work again, was not evenly applied to all employees regardless of whether the employee was pregnant.

Employers should not view this decision as a "free pass" to end the employment of individuals who ask for additional leave time to which they are not entitled under company policies. Because the case was before the court as a PDA claim - and not a claim under the Americans with Disabilities Act or any associated state-law disability statute – it is unclear whether the same rationale would apply if the case had included a claim under the ADA, since various courts have viewed requests for additional leave time as potential requests for reasonable accommodation that should be honored unless they create an "undue hardship" for the company. Such requests therefore should be reviewed on a case by case basis, with an eye toward the ADAAA regulations that were updated in March of this year.

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The U.S. Commission on Civil Rights (USCCR) has posted a report which recommends that the Equal Employment Opportunity Commission (EEOC) modify its position that the use of “English-only” policies is a presumptive violation of Title VII of the Civil Rights Act.  See EEOC’s guideline at 29 C.F.R. § 1606.7 (2010). This report sets up an interesting dichotomy in the analysis of such policies by two governmental agencies, both of which ostensibly were formed primarily to insure civil rights.

While most individuals are aware of the existence of the EEOC, fewer have heard of the USCCR and its mission. The USCCR was established under the Civil Rights Act of 1957 (which was primarily a voting rights bill signed by President Eisenhower after the Brown v. Board of Education decision in 1955)  as an independent, bipartisan, fact-finding federal agency.  Its mission, according to its website, is “to inform the development of national civil rights policy and enhance enforcement of federal civil rights laws.”  It does so by reviewing alleged deprivations of voting rights and alleged discrimination based on race, color, religion, sex, age, disability, or national origin, or in the administration of justice.  The agency plays a vital - but widely unrecognized - role in advancing civil rights through objective and comprehensive investigation, research, and analysis on issues of fundamental concern both to the federal government and to the public.

Although the USCCR has been referred to as a civil rights “watch dog" that works to ensure that the federal government is enforcing civil rights laws fairly and evenhandedly, the original Commission was not configured to act as such.  Originally, all of its members were appointed by the President and were subject to dismissal at any time.  Also, because the Civil Rights Act first came into effect in 1964, the early USCCR had no actual civil rights laws to oversee.  However, in recent years, the agency has publishing significant studies and reports on a wide range of the civil rights, including peer-to-peer violence and bullying, race neutral enforcement of the law, and even human trafficking.

The USCCR’s recent report on English-only rules stems from a conference held in December 2008 at which the issue was discussed and analyzed at length by a number of experts in the field.  A transcript of the conference and resulting briefing - which was carried live on C-SPAN - is available on the Commission’s website, www.usccr.gov, and by request from the Publications Office, U.S. Commission on Civil Rights, 624 Ninth Street, NW, Room 600, Washington, DC 20425, (202) 376-8128.  Based on the testimony provided by panelists, and on discussion with Commissioners, the USCCP adopted findings and recommendations on various courts’ acceptance or rejection of the EEOC guidelines, the potential reasons, both good and bad, behind employer English-only policies, and actions the EEOC and Congress might take to clarify and improve the state of the law as applied to English-only policies under Title VII.

The USCCR’s primary recommendation stemming from the conference is that the EEOC’s guideline at 29 C.F.R. § 1606.7 should be withdrawn, and that instead, employers and employees should be informed that English-only policies should be prohibited only when it can be shown by a preponderance of evidence that the policy was adopted for the purpose of harassing, embarrassing, or excluding employees or applicants for employment on account of their national origin.  This view could indicate a subtle shift in the burden of proof in cases involving English-only policies.  Under the EEOC’s guideline, an English-only policy is presumed to be violative of Title VII unless the employer can show that the policy was enacted for a legitimate business reason; under the USCCR’s interpretation, an employee would have to show evidence of the purpose for which the policy was enacted, and prove that such evidence contravened Title VII.

Employers who have considered the implementation of an English-only policy should be aware that this issue has come into the limelight, and that further discussion and/or proposed legislation is possible.

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In gender discrimination cases under Title VII, a jury can award back pay and front pay, but also can award compensatory damages if it believes that an employee was harmed emotionally or psychologically by the alleged harassment or hostile work environment. The 1st U.S. Circuit Court of Appeals recently affirmed a $1.6 Million damages award against a Massachusetts hospital and a male physician, and in favor of a female neurosurgeon who claimed hostile work environment and retaliation under Title VII. Tuli v. Brigham & Women’s Hospital, 1st Circ., No. 09-1731, August 29, 2011.

Dr. Sagun Tuli, a female neurosurgeon, brought claims against her employer, Brigham & Women’s Hospital and her supervisor, Dr. Arthur Day, after a yearly review of her medical staff credentials resulted in a conditional reappointment. Tuli, who was hired into the hospital’s Department of Neurosurgery in 2002, acted as the department’s professionalism officer and representative to the hospital’s Quality Assurance and Risk Management (QARM) Committee, which required her to investigate and report on other doctors’ case complications. As QUARM representative, Tuli investigated three of Day’s cases, all three of which ultimately were reported to the state’s Board of Registration of Medicine. In addition, Tuli raised concerns to the hospital’s chief medical officer that Day was inappropriate and demeaning to women, including Tuli.

In 2007, Tuli’s medical staff credentials were due for review by the hospital’s credentialing committee. The results of that review would determine whether Tuli would continue to have “privileges” at Brigham & Women’s – that is, whether she would be allowed to practice medicine at the hospital. Day presented Tuli’s case to the committee in unflattering terms, including a suggestion that she would benefit from anger management training. The committee then conditioned Tuli’s reappointment on obtaining an evaluation by an outside agency (“Physician Health Services”) and on agreeing to comply with that agency’s recommendations.

Tuli subsequently filed a lawsuit asking for a preliminary injunction to prevent the loss of her privileges. She also alleged gender discrimination, claiming both disparate treatment and hostile work environment, based upon Day’s behavior toward her. The district court granted the preliminary injunction. Shortly after that, a jury decided Tuli’s claims, awarding $1 Million in compensatory damages against the hospital on Tuli’s hostile environment claim, $600,000 against the hospital in compensatory damages on her retaliation claim, and $20,000 against Day personally for economic harm on a “tortuous interference with business” claim. At that point, the lower court entered a permanent injunction, keeping the hospital from withdrawing Tuli’s privileges at the hospital. The hospital appealed on all counts.

On appeal, the First Circuit upheld the jury’s verdict, as well as the permanent injunction. It found that the evidence showed that Day frequently had questioned Tuli’s authority, calling her a “little girl,” and asking whether she really could do a “big operation.” In addition, the First Circuit upheld the use of evidence at trial that included incidents outside of the applicable 300-day statute of limitations. In other words, it upheld Tuli’s evidence to the jury of Day’s behavior over the course of her employment, and not simply behavior within the 300 days prior to her first formal claim. Under this “continuing violation” theory, if an act contributing to the claim occurs within the filing period, the entire time period of the alleged hostile environment can be considered by the jury for purposes of determining liability.

While this case is a warning to employers on the risks associated with hostile environment and retaliation claims, the warning is especially strong for hospital and health care systems that directly employ physicians. First, the income level of the individual involved typically translates into higher damages awards when juries find in their favor; and second, the risk created by the overlap between the credentialing process and hostile environment cannot be ignored, especially when an alleged harasser is directly involved in the credentialing process.
 

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The 3d U.S. Circuit Court of Appeals has held that 15 minutes was a sufficient amount of time for the plaintiff, a public school teacher, to review a separation agreement and release negotiated in connection with her resignation. Gregory v. Derry Twp. Sch. Dist., 2011 WL 944424 (3d Cir., March 21, 2011)

Rhauni Gregory, a public school teacher, sued her former employer and a number of individuals for race discrimination under 42 U.S.C. §1981. Although prior to her resignation from employment, Gregory signed a separation agreement that included a release, she subsequently claimed that the agreement was invalid and that it did not preclude her from suing the School District. Her argument was based largely on the fact that when she was asked to sign the agreement, Gregory was provided only about 15 minutes to deliberate whether to sign. However, the agreement had been reviewed and negotiated by a representative of the teachers’ union of which Gregory was a member, who assured that the agreement included continued health benefits and a positive letter of recommendation, both of which Gregory had indicated were critical to her. In addition, Gregory claimed that she signed the agreement under duress, because the school principal sat next to her as she reviewed the document. However, she was unable to point to any actual restriction on her ability to think or consider in that circumstance, or to show any specific instance of “duress.” The lower court granted the school District’s motion for summary judgment, finding that Gregory had waived her right to sue when she signed the release agreement.

The Third Circuit affirmed on appeal. Examining the facts under the applicable “totality of the circumstances” test, the Court rejected Gregory’s attempt to avoid the agreement, finding that she had sufficient time to review the agreement, and that she did not sign under coercion or duress. The Court reviewed the seven factors to be considered: 1) the clarity and specificity of the release language; 2) the plaintiff's education and business experience; 3) the amount of time the plaintiff had to deliberate about the release before signing it; 4) whether the plaintiff knew or should have known her rights upon execution of the release; 5) whether the plaintiff was encouraged to seek, or in fact received benefit of counsel; 6) whether there was an opportunity for negotiation of the terms of the agreement; and 7) whether the consideration given in exchange for the waiver and accepted by the plaintiff exceeded the benefits to which she was already entitled by contract or law.

It is important to this decision that Gregory’s representative already had approved the agreement before Gregory reviewed it, and that Gregory had negotiated certain specific benefits in exchange for resigning.  Based on those background facts, employers cannot interpret this case as providing permission to rush an employee into signing a release, and in most cases still should provide sufficient time for the employee to review an agreement and confer with an attorney or other representative.  In addition, it is important to note that releases of claims under the federal Age Discrimination in Employment Act (ADEA) must comply with the minimum review period and other specific requirements of the Older Workers Benefit Protection Act.
 

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The 8th U.S. Circuit Court of Appeals has upheld summary judgment against a bank teller who claimed that she was constructively discharged when she left her job on the last day of her pregnancy-related medical leave. Trierweiler v. Wells Fargo bank, 8th Cir., No. 10-1343, April 8, 2011.

An individual can support a claim of constructive discharge by demonstrating that a reasonable person would have found the employment conditions intolerable, and that the employer either intended to force that person to quit, or could reasonable have foreseen that she would do so. Kimberli Trierweiler began working for Wells Fargo Bank in October 2006 as a teller in the bank’s Watertown, South Dakota branch. The handbook that Trierweiler received at the outset of her employment indicated a “regular and dependable attendance” was an essential function of her job, and that excessive absences from work would lead to discipline, up to and including termination. The handbook also provided methods for reporting employment issues, including concerns related to accommodations for medical issues.

Bank employees received 160 hours (20 days) of paid time off (PTO) each year, and could exercise that time off after 30 days of employment. Between her start date and the end of 2006, Trierwetler used her pro rata allotment of PTO, along with four and a half unpaid additional days of absence.

In December 2006, Trierweiler informed her supervisors that she was pregnant. Although she was not eligible for Family and Medical Leave (not having worked for the Bank for the requisite one year), she would have been entitled to maternity leave under a short-term disability plan, which had a 5-day “waiting period” during which Trierweiler would have had to use PTO days or unpaid leave.

By mid-April 2007, Trierweiler had used eleven and a half days of PTO, with three additional days scheduled before the end of April, amounting to 120 hours of her available 160 hours of PTO for 2007. None of that time was related to her pregnancy. During a meeting with her supervisor at that point, Trierweier was warned about her frequent absences.

On May 9, Trierweiler took another PTO day to stay home with a sick child. Following that, Trierweiler was told that if she had another absence, she would receive a written warning. On May 14, Trierweiler left a phone message for her supervisor, stating that her doctor had prescribed a week of pregnancy-related medical leave. According to Trierweiler, her supervisor responded with a message that said that “This isn’t going to work, you taking time off.” Trierweiler did not have any further direct contact with her supervisor or any HR person on the issue, but testified in her subsequent lawsuit that she felt that the message meant that she no longer had a job.

While Trierweiler was on her medical leave, her supervisor sought advice from HR. It was decided that Trierweiler should receive a written warning for her previous absences (not including the current leave), but that a company program, called “WorkAbility” would be explored for temporary accommodations for the current and any future pregnancy-related leaves. Two days later, on the final day of her week-long leave, Trierweiler drove through the bank’s drive-through lane, handed her keys to the teller, and stated that she was “done.” She followed this with a phone message to her supervisor that she had done so, and asked for her personal office items.

Trierweiler brought a federal court action under Title VII’s Pregnancy Discrimination Act, claiming that she had been constructively discharged. The lower court granted summary judgment in favor of the Bank, and that decision was upheld by the Eighth Circuit. In spite of Trierweiler’s argument that an alleged statement by her supervisor - that she couldn’t miss additional work without being fired – was designed to force her to quit, the Eighth Circuit pointed to the company’s decision to seek assistance from WorkAbility to explore possible accommodations for the situation. According to the Court, this showed an intent to maintain an employment relationship with Trierweiler, not an attempt to force her to quit, or to create an intolerable condition that would make it impossible for her to continue to work there.

Trierweiler never spoke with HR, utilized any resources provided in the handbook for problem resolution, or asked for clarification of any of the phone messages left for her about her absences. As such, Trierweiler failed to provide an opportunity for the company to remedy the issues of which she was complaining. The lesson here is that Court’s are hesitant to find constructive discharge when an employee does not allow the employer a reasonable chance to work out the problem. Further, the Bank’s efforts to find a resolution to the problem, and its documentation of that effort, helped to successfully defend against this claim.
 

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The 1st U.S. Circuit Court of Appeals reminds us that while Congress’ antidiscrimination laws are designed to protect workers’ rights, they are “not intended to function as a collective panacea for every work-related experience that is in some respect unjust, unfair, or unpleasant.” Consistent with this statement, the court dismissed the claims of four female radiology technicians who complained that their supervisor’s abrasive behavior and its resulting “nerve-wracking” work environment caused each of them to leave her employment at a Department of Veterans Affairs (VA) hospital. Ahern, et al v. Shinseki, 1st Cir., 09-1985, December 13, 2010.

Eileen Ahern, Debra Auger, Maureen Mastalerz, and Lynda Parker were employed as radiology technicians in the diagnostic imaging service (DIS) of a VA Hospital in Providence, Rhode Island. All four reported to a chief technologist (Joan Beaudoin) who, in turn, reported to the administrative officer, Mehrdad Khatib, who was in charge of personnel management. When Khatib first took over, the DIS employed 16 staff technologists, 14 of whom were female. Khatib hired contract technologists, 11 of whom were male and 7 of whom were female.

Beginning in 2003, the plaintiffs and several of their co-workers complained to Beaudoin about Khatib’s management style, claiming that Khatib was creating “stressful working conditions” and a “hostile working environment.” Khatib was advised of the issues, and was asked to work to resolve them.

Early in 2004, Khatib advised Beaudoin that the 4-day workweek schedule by certain of the technologists, including all four plaintiffs, was creating inefficiencies, and asked Beaudoin to change that schedule to a regular 5-day workweek. This change was not implemented, although Beaudoin ultimately instituted a modified version of Khatib’s proposal that included keeping the 4-day workweek intact.

In April 2004, the plaintiffs, along with three female and two male coworkers, submitted a formal complaint about Khatib, suggesting that he had proposed the 5-day workweek in retaliation for the employees’ initial complaints against him, and complaining that he had treated a particular male employee “with more respect” than others, that he was “bullying” the staff, that he harbored “unreasonable and unrealistic expectations,” and that he was setting employees up to “look and feel like failures.” While the complaints were identified as “sex discrimination,” they included a statement that Khatib also treated certain male employees “horribly.”

All four plaintiffs ultimately left the VA Hospital and filed a lawsuit, claiming gender-based discriminatory hiring, retaliation, and constructive discharge. The lower court entered summary judgment for the hospital, which was upheld by the First Circuit on appeal.

The First Circuit found that because none of the plaintiffs actually applied for any of the positions filled by Khatib, there could be no gender-based discrimination against hiring them. In response to the claim of retaliation, the Court held that the plaintiffs were unable to show the required “materially adverse action” that underlay the claim. While the plaintiffs pointed to Khatib’s attempt to change their 4-day workweek, the Court specifically found that “[m]erely proposing a change in an employee’s schedule does not, in and of itself, constitute a materially adverse action.” Because Khatib’s plan was never brought to fruition, no materially adverse action occurred and, therefore, no retaliation could be proven. In response to the plaintiff’s last claim, the Court found that the allegation of constructive discharge was not sufficiently supported, because the plaintiffs failed to show that their working conditions were “so difficult or unpleasant that a reasonable person . . . would have felt compelled to resign. While the Court agreed that plaintiffs’ evidence showed that Khatib’s behavior “created divisiveness and unrest among employees who worked under him,” and that it “may have engendered a “nerve-wracking environment,” that environment was not based on gender. The Court pointed out that “generally disagreeable behavior and discriminatory animus are two different things.”

Working for a difficult or even unreasonable supervisor can be burdensome, but unless evidence exists to show that such behavior by a supervisor is gender based, Title VII is not the appropriate vehicle for recourse. Of course, this case should not be read to justify overlooking or ignoring complaints made by employees. An employer’s obligation to effectively and promptly investigate employee complaints should not be taken lightly. While Title VII and other state and federal antidiscrimination laws are not meant to be viewed as a code of general civility, the parameters set by those statutes should be reviewed, understood, and enforced by employers, in order to avoid the risk of liability that accompanies their violation.
 

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In an unpublished opinion, the 3d U.S. Circuit Court of Appeals has upheld a lower court’s decision to dismiss an employee’s claims of discrimination, hostile work environment, and retaliation, based largely upon the “extraordinary lengths” to which the employer went to investigate the issues complained of by the employee. Wood v. University of Pittsburgh, 3d Cir., No. 09-4469, September 23, 2010.

Deborah Wood was employed as a systems analyst by the University of Pittsburgh. Upon beginning her work on a project in a Biostatistical Center at the University, Wood was provided a retention letter that informed her that the continuation of her position was contingent upon the renewal of non-university grants that funded the project. In 2007, approximately 90% of the project’s funding was provided by grants from the National Institute of Health (NIH). In June of that year, Wood was informed that she was one of 17 individuals selected for discharge during a reduction in force, after the NIH announced that it would reduce funding of the project by over two million dollars. 

On the day of her discharge, Wood served the University with a federal court complaint asserting gender and race discrimination. Her claims were based upon incidents about which she had complained during the years preceding the reduction in force. In 2005, Wood had become convinced that someone was tampering with her office computer, and reported her belief that the computer had been remotely accessed by an unknown user. She also claimed that someone was entering her office when she was not present. Her supervisor responded to these concerns by installing a lock on the office door, by purchasing and installing software to monitor the computer usage, and by asking the University’s computer services department to review activity related to the computer. After months of investigation, including over 150 hours spent by the supervisor himself, no evidence of improper tampering was found. 

Wood was not satisfied, and contacted the University’s HR department to express that dissatisfaction. The HR department then initiated its own investigation through the summer of 2006, providing a new computer to Wood, reformatting her hard drive, and reviewing additional event logs. In November 2006, Wood alleged that someone had broken into her locked office. That report led to an investigation by campus police, along with additional forensic work by the computer department, again without evidence of inappropriate or unlawful activity. Wood considered these efforts to be “inadequate,” and filed a charge of gender discrimination with the EEOC in December 2006.

In 2007, after learning of the NIH decrease in funding and the impending layoffs, the project director offered to Wood an opportunity to interview for a new position in another section of the same project group. Wood declined the offer, and was discharged on July 12, 2007. She served her lawsuit upon the University on that same date.

The lower court dismissed Wood’s race claim prior to discovery because Wood had failed to assert that specific claim in her EEOC charge. After a period of discovery, the court also granted summary judgment in favor of the University on the remaining claims, and Wood appealed that decision. The Third Circuit upheld the dismissal of Wood’s gender discrimination claim, based upon Wood’s failure to demonstrate that the University had retained similarly situated employees who were outside of the protected class (which would have raised an inference of discriminatory animus). Dismissal of her retaliation claim was upheld because the University proffered evidence of a legitimate non-discriminatory reason for Wood’s discharge – undisputed evidence that the project’s budget was reduced when NIH funding was withdrawn, thereby necessitating layoffs. 

Most interesting was the Court’s response to Wood’s hostile environment claim, in which she argued that she suffered persistent harassment which “must have been” the result of gender bias. Upholding dismissal of the claim, the Court pointed out that the University “went to extraordinary lengths” to investigate Wood’s allegations; the Court found no evidence to suggest that any aspect of that investigation was influenced by gender bias. 

The fact that the Court was able to review and remark upon that evidence in such detail indicates that the University thoroughly investigated the incidents reported by Wood and fully documented its efforts. Employer must recognize that such investigation and documentation are the cornerstones of an effective defense against claims of unlawful discrimination and hostile environment.

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In 2009, Congress passed the Lilly Ledbetter Fair Pay Act (FPA), which allows employees to file unequal-pay claims outside of the otherwise applicable 300 day statute of limitations period for filing claims of discrimination. Under the FPA, the statute of limitations re-starts each time compensation is paid pursuant to a “discriminatory compensation decision or other practice,” typically when a periodic paycheck is issued. In an issue of first impression, the 3d U.S. Circuit Court of Appeals recently upheld summary judgment for an employer, and specifically held that a black Haitian mechanic could not use the FPA to support his failure-to-promote claim under Title VII. Noel v. Boeing Co., 3d Cir., No.08-3877, October 1, 2010. In that case, an employee unsuccessfully argued that the 300-day statute of limitations began each time he received a lower paycheck than he would have received had he been promoted three years prior to his claim of discrimination.

Emmanuel Noel, a black Haitian national, began working for Boeing in 1990 as an hourly sheet metal assembler. Boeing periodically offered the opportunities to work at offsite locations. Those opportunities included greater pay, per diems, and additional training, and often resulted in promotion to a higher labor grade, if warranted by the skill and ability of the worker. In 2002, Noel and two white employees participated in an offsite assignment that resulted in their labor grades rising from 7 to 8. After seven months, the labor grade of the two white employees rose from 8 to 11, while Noel’s remained the same.

In September 2003, Noel complained about that situation to a union representative and a company labor representative, but no action was taken. On March 25, 2005, Noel filed a charge of discrimination with the EEOC, followed by a Title VII complaint in federal court on June 30, 2006. The complaint included an allegation that Noel was not promoted in 2003, when his white co-workers were.

The district court found that Noel’s claims were time barred because he did not file his EEOC charge within the required 300-day period that began when Boeing failed to promote him in 2003. Noel appealed the dismissal of his claims, arguing that under the FPA, his 2005 charge was timely, because the 300-day statute of limitation period restarted every time he got a paycheck that reflected the company’s failure to promote him to a higher paying job.

The Third Circuit upheld the lower court’s decision, stating that the FPA applies only to cases that involve “discrimination in compensation.” Discrimination in compensation means “paying different wages or providing different benefits to similarly situated employees, not promoting one employee but not another to a more remunerative position.” According to the Court, the FPA only comes into play if the employee’s complaint is based on a pay disparity – and a pay disparity claim is made only when an individual demonstrates that he or she was paid differently for equal work done under substantially similar conditions. Courts have universally treated pay disparity claims and failure-to-promote claims as separate causes of action. Therefore, Noel could not use the FPA to excuse his non-compliance with the applicable 300-day statute of limitations.

It could be argued that many employment-related decisions ultimately have some effect on compensation. However, because individuals typically have some recourse under other anti-discrimination statutes for those acts, allowing the FPA to extend statutes of limitations in those cases would “weaken” the existing administrative exhaustion requirement included in those laws, and could essentially subject all employment decisions to a time period in excess of the required 300-day limit. Employers should be aware of this decision, however, and should carefully analyze employment discrimination claims to determine whether a genuine disparate pay action is involved. If so, the claim may not be subject to the general 300-day statute of limitation.
 

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The 8th U.S. Circuit Court of Appeals has determined that a company’s unwritten policy against hiring applicants with theft-related convictions was sufficient basis to exclude a minority applicant from a position with the company. EEOC v. Con-Way Freight, Inc., 8th Circ., No. 09-2926/2930, Sept. 22, 2010.

Roberta Hollins, an African-American female, was interviewed by Kenneth Gaffney, a branch manager for Con-Way Freight, for a part-time customer service position in Poplar Bluff, Missouri. During the interview, Hollins completed an application, on which she disclosed two misdemeanor shoplifting convictions.

Gaffney was impressed by Hollins, and was interested in hiring her. He discussed that plan with Kevin Beer, the vice-president of operations and Gaffney’s supervisor. Upon learning that Hollins was Black, Beer stated that Gaffney would be “opening up a can of worms” by hiring her. Gaffney continued the interview process and during a second interview with Hollins told her that his boss “told me not to hire you because if I hired you that I was just asking for the NAACP.” After completing the interview process, Gaffney told Hollins and one other candidate, Patterson – a Caucasian female – that they each had the job, and sent them both for a pre-employment drug test. However, this was in direct contravention to Con-Way’s hiring policy, which requires that prior to making an offer of employment or requiring a drug test, the personnel department must run a background check and approve the chosen candidate. Neither was done in this instance.

When Hollins did not hear from Gaffney after her drug test, she called Con-Way and was informed by Kevin Beer that Gaffney was no longer with the company. Subsequently, Gaffney’s replacement, Gary Sellers, was contacted by Anthony Godwin, a third person to whom Gaffney had offered the position. At that point, Sellers was unaware of Hollins’ discussions with Gaffney, and hired Godwin for the position. Hollins then filed a complaint with the EEOC, claiming violation of Title VII, Section 1981, and Missouri state law. The EEOC filed suit on her behalf, echoing those claims. The lower court dismissed the claims, and the EEOC (with Hollins) appealed to the Eighth Circuit.

The Eighth Circuit upheld summary judgment in Con-Way’s favor, finding that Hollins was unable to show a specific link between the alleged discriminatory animus and Con-Way’s failure to hire her. The Court pointed out that Con-Way’s policy of automatically disqualifying applicants with theft-related convictions would have resulted in Hollins’ application being rejected and, therefore, Hollins would not have been hired regardless of any discriminatory animus. While the EEOC argued that Con-Way’s policy was not in writing and was therefore not valid, the Court cited evidence produced by Con-Way that within a span of 18 months, the company had disqualified 28 applicants solely because of theft-related convictions, and that no employees at the Poplar Bluffs service center had prior criminal convictions. In addition, the Court pointed out that Hollins could not establish that she was qualified for the open position because her theft-related convictions rendered her unqualified for any position within the company.

The Eighth Circuit upheld the summary judgment in favor of Con-Way, dismissing all claims. However, it while it dismissed the federal claims “with prejudice,” meaning that Hollins cannot bring another action based upon those claims, it dismissed the Missouri state-law claims “without prejudice,” meaning that Hollins can take those claims to a Missouri state court for decision.

Employers should take note of this case for a number of reasons. First, Gaffney’s actions in going outside the established hiring protocol by offering a position to two people prior to formal background checks and an okay from the personnel department created litigation that may continue for some time into the future. Second, and just as noteworthy, is the fact that a single racially insensitive remark (that Hollins hiring would “open a can of worms”) by the vice president of operations actually triggered the chain of events that resulted in the litigation. Both of these facts indicate a critical need to train supervisors and managers to fully understand the ramifications of their actions, and to assure coordination in the hiring process to help avoid legal actions of this nature.
 

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An employer’s failure to keep an female employee apprised of its response to her complaints of sexual harassment, and its further failure to follow through on remedial actions could lead a reasonable jury to find that the employer did not take the complaints seriously. Such failures form the basis of a recent decision by the 8th U.S. Circuit Court of Appeals in which the Court denied an employer’s post-trial motion regarding a $100,000 jury verdict. Sheriff v. Midwest Health Partners, P.C., 8th Cir., No. 09-3367, August 30, 2010.

Sheri Sheriff was a licensed physical therapist employed by Midwest Health Partners in Nebraska. Midwest had acquired a chiropractic clinic in 2003 and had asked Sheriff to run the clinic’s physical therapy department. After she began working at the clinic, one of the employed chiropractors (Dr. Meyer) began to act toward Sheriff in a way that made her uncomfortable, including touching her and putting his arm around her. When she informed one of the nurses about Dr. Meyer’s conduct, Sheriff was told to “get used to it,” because “that’s just the way he is.”

Dr. Meyer’s conduct continued, and Sheriff ultimately reported the issue to Midwest’s management. Sheriff also wrote a letter to Meyers, explaining that the advances were “NOT okay!” and that she did not want further physical contact with him. Meyers apologized to Sheriff and said it wouldn’t happen again.

In spite of the fact that Midwest’s president (Dr. Vrbicky) was aware of a prior female patient’s complaint involving Meyer, no one from Midwest discussed Sheriff’s allegations with Meyer until Sheriff learned of that complaint, and of other instances involving another female patient. At that point, Sheriff spoke to Midwest’s Practice Manager about the situation. In addition, Meyer again began to touch, grab, and embrace Sheriff, wrapping his arm around her and touching her breasts. Sheriff then obtained an attorney who wrote to Midwest, advising it “to take aggressive action to protect itself,” and making several recommendations to stop Meyer’s behavior. Seven weeks later, in November 2005, Midwest met with Meyer, asking him to participate in counseling and requesting that he sign an acknowledgement of his inappropriate behavior. He did neither, and his behavior with respect to Sheriff took on a condescending and intimidating tone.

In a January 4, 2006 letter, and at a January 13, 2006 meeting, Midwest again set forth its remedial recommendations, and again, Meyers refused to participate. Finally, on February 23, he agreed to attend sexual harassment training, but only attended one of five sessions. Durin this same period, Sheriff was told that Meyer would be terminated within 45 days. He was not, and Sheriff was given no reason for that turn of events.

On April 11, 2006, Sheriff resigned and brought a legal action against Midwest. At trial, a jury awarded to Sheriff $100,000 on her hostile work environment claim, and Midwest filed a post-trial motion for judgment in its favor. The 8th Circuit denied that motion, finding that the jury had a reasonable basis for its verdict.

The Eighth Circuit’s opinion includes two points of which employers should be aware: first, it rejected Midwest’s argument that Meyer was simply a “touchy person” who patted men on the buttocks and, therefore, his conduct was gender neutral and not sexual harassment. Once again, a federal appellate court has rejected that argument, pointing to the fact that in this case, there was no evidence that Meyer “pulled men into his body” nor was there evidence of any complaints by men or by male patients. Secondly, at least three times in its opinion, the Court mentions the fact that Midwest failed to apprise Sheriff that it was taking action in an attempt to remedy the complained-of situation, or failed to follow up on the termination action that it told her that it was taking. It cites those failures as a possible basis for the jury’s finding that Midwest did not take Sheriff’s complaints seriously. Whether or not that was the reason for Midwest’s failures, it is important to note that this Court believed that open communication with Sheriff regarding Midwest’s remedial efforts was an important element of the employer’s responsive actions to Sheriff’s complaints. While there is no legal obligation to inform a complainant of each and every detailed step in a disciplinary action taken against an alleged harasser, the fact that the complainant is treated with courtesy and respect, and is a full participant in the process, can play a role in the way that a court or a jury views the credibility and effectiveness of the employer’s attempted remedial actions.
 

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The 9th U.S. Circuit Court of Appeals has held that a female co-worker’s “relentless” pursuit of a male employee, including verbal comment and suggestive notes, could form the basis of a sexually hostile environment, even without any physical conduct of a sexual nature. EEOC v. Prospect Airport Services, Inc., 9th Cir., No. 07-17221, Sept. 3, 2010.

Rudolpho Lamas began working for Prospect Airport Services in the Spring of 2002, shortly after the death of his wife in September of 2001. In the Fall of 2002, and without instigation from Lamas, a married female co-worker (Munoz) began to make sexual overtures toward Lamas after she heard that he had stated that he “missed coming home to a family.” In November, Munoz handed a note to Lamas, telling him she was “turned on” and wanted to “go out” with him. Lamas informed their boss (O’Neill) about the note, and was advised to let Munoz know that he wasn’t interested, and to tell Prospect’s managers if Munoz continued her actions. Although Lamas let Munoz know that her interest was not reciprocal, Munoz continued her advances, including additional notes and a photo of herself that Lamas found to be sexually suggestive. At this point, Munoz reported the continued activity to another company supervisor (Thompson), who told Lamas that she would report the incidents to the general manager (Mitchell) and talk to Munoz. She did neither.

At that point, Lamas received a third, and more explicit, note from Munoz; Lamas reported this note directly to Mitchell. At that point, Munoz had also recruited other co-workers to let Lamas know how she felt. In response to Lamas’ report, Mitchell said that he “did not want to get involved in personal matters” but ultimately spoke to Munoz and told her that Lamas wanted the activity to stop.

Unfortunately, the activity did not stop; it escalated into daily comments and suggestive remarks from Munoz. This continued through the Spring of 2003. At one point, Munoz made sexual comments to Lamas in front of airline passengers, embarrassing both Lamas and the passengers. Although Lamas had reported his concerns to four different managers, no remedial action was taken. In fact one of the managers told Lamas that the whole thing was “a joke” and that he should be singing “I’m too sexy for my shirt.” Lamas began to have problems at work, including the fact that his co-workers started rumors that Lamas was gay because he was rebuffing Munoz’ approaches. Lamas’ work performance deteriorated, and he ultimately was fired for poor performance in June 2003.

Lamas took his complaint to the EEOC, which found enough factual basis to support a hostile work environment, and filed suit on his behalf. The district court granted Prospect’s motion for summary judgment, concluding that Munoz’ conduct was not “severe and pervasive” enough to support a claim for hostile work environment. In its opinion, the court stated that Munoz’ conduct was not objectively unwanted for most men, and that “most men in [Lamas’] circumstances would have ‘welcomed’ the behavior he alleged was discriminatory.”

The lower court’s dismissal was reversed on appeal to the Ninth Circuit, which pointed out that under Title VII, “[b]oth sexes are protected from discrimination.” The appellate court pointed out that “it cannot be assumed that because a man receives sexual advances from a woman that those advances are welcome.” This is a stereotype that the court refused to accept, and pointed out that “welcomeness” is an inherently subjective issue. However, it also added that unwelcomeness has to be communicated. Here, Lamas not only expressed his refusal to Munoz, he also continually stated – to his co-workers, his friends, and four different company managers – that his Christian background and the recent death of his wife led him to find Munoz’ actions inappropriate and offensive. The Court also pointed out that while not all propositions for romance are sexual harassment, Munoz’ conduct, including the continued advances after Lamas’ rejection, her involvement of co-workers in her efforts, the suggestive photograph, and her “relentless” sexual remarks created an environment that Lamas reasonably perceived as hostile and abusive.

Notably, the Court also pointed out that the company’s actions were insufficient to establish an affirmative defense to Lamas’ complaints. Prospect’s managers did little or nothing in response to Lamas’ reports, instead telling him he should be singing “I’m too sexy for my shirt.” While that remark is troubling, the fact that the complaints by Lamas were made by a man regarding the actions of a woman may have created a skewed response from the company. Employers must recognize that Title VII protects both genders, and that a male employee’s report of harassment should be investigated and responded to as effectively as one made by a female employee.
 

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The 7th U.S. Circuit Court of Appeals has held that it is up to a jury to determine whether, in fact, a single instance of uninvited intimate physical contact may be sufficient to support a claim of hostile work environment. Berry v. Chicago Transit Authority, 7th Cir., No. 07-2288, August 23, 2010.

Cynthia Berry was hired by the Chicago Transit Authority (CTA) in 2002 as a carpenter. In January 2006, Berry was one of only two female employees among about 50 individuals working in Area 315, and was the only female of the 15 carpenters working there. During breaks, employees in Area 315 often played cards at a picnic-style table in a break area. During a morning break on January 17 or 18, Berry sat down at the table with three male employees. A fourth male employee, Carmichael, sat down straddling the bench, with his back toward Berry. According to Berry, Carmichael began rubbing his back against Berry’s shoulder. She jumped up, told him to stop, and moved to the other end of the table. Although another employee told Berry to get up, Berry remained seated. Berry alleges that Carmichael then lifted her from behind, grabbing her by the breasts, and rubbed her body against his before throwing her to the ground “with force.” She further alleges that Carmichael then pushed her into a fence.

On the following day, Berry reported the incident to one of her supervisors (Gorman), who – according to Berry – told her that she was a “pain in the butt” and that she could lose her job if she filed charges against Carmichael. Berry alleges that Gorman also said that he was “going to do whatever it takes to protect CTA.” However, Gorman reported the incident to a CTA EEO investigator, and collected statements from Berry and the others who witnessed the incident for review by the investigator. In the meantime, Berry called the police, reporting that she had “been attacked” at work. The police spoke to Berry, Carmichael and Gorman, and determined, based on that investigation, that Berry actually had been the aggressor. The CTA investigation ultimately resulted in the same finding. Berry contends that Gorman sabotaged the investigation to prevent the alleged harassers from being punished; she then filed a lawsuit alleging gender discrimination, hostile work environment, and retaliation. The lower court granted summary judgment in CTA’s favor, dismissing all of Berry’s claims. It dismissed the gender discrimination claim based on the absence of an adverse employment action, and the retaliation claim because Berry raised the issue only during the summary judgment process. The lower court also found that the hostile environment claim could not go forward because CTA took prompt and reasonable steps to discover and rectify the actions complained of by Berry.

On appeal, the Seventh Circuit upheld the dismissal of the gender discrimination and retaliation claims, but reversed the dismissal of the hostile environment claim. In order for that claim to survive summary judgment, Berry had to show that she was subjected to unwelcome conduct because of her sex, that the conduct was so severe or pervasive that it created a hostile environment, and that there was a basis for CTA’s liability. Berry argues that she experienced a hostile environment when Carmichael allegedly rubbed his body with hers; she also argues that Gorman’s dismissive comments to her about her complaints form the basis for CTA’s liability. The lower court had discounted Berry’s uncorroborated testimony on those issues when it found in CTA’s favor.

The Seventh Circuit spelled out the principles upon which it based its decision, specifically finding that personal knowledge or first-hand experience of a plaintiff can create a “disputed fact” that can only be resolved by a jury. According to the Seventh Circuit, the lower court improperly discounted Berry’s testimony, which was based on her own personal encounters with both Carmichael and Gorman and therefore, according to the Seventh Circuit, could create issues of material fact sufficient to preclude summary judgment. The Court further held that a single act can create a hostile environment if it is severe enough. Carmichael’s actions, as alleged by Berry, qualify as such an act. Notably, the Seventh Circuit also determined – based solely on Berry’s uncorroborated testimony of Gorman’s remarks – that a “reasonable factfinder” could come to the conclusion that CTA, through its manager, had “maliciously thwarted any legitimate investigation, and that CTA was therefore negligent or worse in responding to [Berry’s] report of harassment.”

The primary method for employers to avoid this situation is to be able to show thorough and detailed investigation training, and to ensure that managers’ responses to complainant/employees are consistent, objective, and by-the-book, in order to establish some defense to the uncorroborated testimony of such employees.
 

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The 6th U.S. Circuit Court of Appeals has held that a company that transferred a pregnant employee out of a welding job and into a light duty tool room job without first undertaking an objective evaluation of the employee’s ability to do the welding job may be liable for violation of the Pregnancy Discrimination Act (PDA) or the Americans with Disabilities Act. Spees v. JamesBuilt, LLC, 6th Circ., No. 09-5839, August 10, 2010.

Heather Spees filed claims against her employer, James Marine, Inc. (JMI) alleging that the company violated Title VII’s Pregnancy Discrimination Act and the Americans with Disabilities Act when it moved her from a welding job into a light duty tool room job, and when it ultimately terminated her employment.

Spees became pregnant shortly after being her job as a welder with JMI in 2007. This was her third pregnancy; her daughter was born in 1999, but Spees suffered a miscarriage in 2005. Spees informed her brother (Gunder), who also worked at JMI as a foreman, and her direct supervisor (Milam), of her pregnancy. Gunder believed that the welder duties – especially the lifting and pulling - should not be performed by Spees while she was pregnant. Milam was concerned that, because of Spees’ “complications with other pregnancies,” Spees should not be around “the chemicals, the welding smoke, [and] climbing around on some of the jobs.” Although Spees’ doctor opined that the welding job would be “no problem” and released her to work without restrictions, Milam asked Spees to obtain a second note from the doctor limiting her to “light duty,” which Spees did. Milam then transferred Spees to the company’s tool room, at the same pay and benefits.

Spees worked the daytime shift in the tool room for a week, but then was transferred to the night shift, which conflicted with Spees child-care schedule. A month later, Spees transferred her medical care to another obstetrician, who discovered that Spees had a pregnancy-related medical condition that required total bed-rest. When Spees provided documentation to the company of that fact, Gunder told her that she “was being fired for being pregnant,” and because she had not worked at JMI long enough to have earned FMLA or other additional medical leave.

The district court granted summary judgment for JMI on all of Spees’ claims, holding that the transfer did not constitute the required “adverse employment action” under the PDA, and that JMI’s reason for firing Spees – the fact that her doctor placed her on full bed-rest, and she had no additional available medical leave – was not a pretext for discrimination. The Sixth Circuit reversed the decision regarding the transfer, but upheld the dismissal of the termination claims.

According to the Sixth Circuit, the record in this case included evidence to suggest that Spees’ transfer was a materially adverse change in her employment status, in spite of the fact that her salary and benefits remained the same. The work required fewer qualifications (and therefore, may be viewed as lower status), was “more boring” for Spees than welding had been, and was night-shift work that interfered with her ability to raise her child. Further, Spees was able to present sufficient evidence to allow a jury to find that her pregnancy was a “motivating factor” in her transfer to the tool room job: Milam expressed concerns (which he believed were based on “common sense”) that the fumes would create an unsafe condition for her; and Gunder stated that he did not want to her weld because “she was carrying my niece.” Neither of these managers requested an analysis of the welder position for review by Spees’ doctor, nor did Spees seek the transfer before it was made. In sum, a reasonable jury could find that JMI’s decision that Spees was unable to weld was due to her pregnancy, thereby supporting her PDA claim.

The Sixth Circuit agreed, however, that Spees’ inability to work at all during her period of bed-rest was a legitimate business reason for her termination. That restriction came through no action on the part of JMI and was a decision made solely by Spees’ doctor. That order for bed-rest, coupled with the fact that Spees had no available leave time, was a legitimate basis for the termination.

The Court’s opinion emphasizes the point that an employer cannot make a decision based on suspicion, assumption, or subjective information – even if that decision seems to be in the employee’s best interest. Here, the managers’ view that Spees would be unable to perform her job as a welder because of her prior miscarriage led to the Court’s holding that Spees’ transfer may have been motivated by her pregnancy. That holding in turn resulted in a decision to allow a jury to determine the company’s level of liability for that act.
 

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For the second time in as many weeks, a federal appeals court decision rests on the determination that an alleged harasser who makes gender-specific slurs and comments can create a hostile work environment for a female employee, even though the harasser is an “Equal Opportunity Harasser” who makes crass and offensive remarks to “everyone, regardless of gender.” Sharon Kaytor v. Electric Boat Corp., 2d Circ., No. 09-1859-cv, June 29, 2010.

Sharon Kaytor worked for Electric Boat Corporation for nearly 20 years as an administrative assistant, beginning in 1998. During most of that time, Kaytor worked for Daniel McCarthy, one of the managers in the engineering department. Kaytor alleges that in 2004, McCarthy seemed to “undergo a change of character.” Although he didn’t touch Kaytor in a sexual or violent way, McCarthy allegedly began to make inappropriate remarks to Kaytor including references to her body and how she smelled. Further, according to Kaytor, on nearly a dozen occasions, McCarthy threatened to hurt, choke, or kill her. At first, Kaytor ignored the remarks, knowing that McCarthy was going through a divorce. However, in April 2005, Kaytor informed McCarthy that she was going to report certain offensive remarks that he had made regarding Kaytor’s visit to her gynecologist. In response, McCarthy is alleged to have stated “I’ll kill you” if a report was made. Subsequently, for Administrative Assistants’ Day, McCarthy gave to Kaytor a potted plant – a pussy willow – with an arguably sexual message attached to it.

After that incident, Kaytor complained about McCarthy to HR. Immediately following the report, Kaytor was transferred to work for an engineer who reported directly to McCarthy, and who – according to Kaytor – treated her “poorly,” changing her work hours, and screaming at her for the “whole department” to hear.

Although Kaytor continued to work for Electric Boat, she filed administrative charges and, ultimately, in December 2006, a lawsuit alleging retaliation at her job. The lower court granted summary judgment for the company, saying that the incidents complained of by Kaytor were not sufficiently severe and pervasive to constitute a sexually hostile work environment. The court specifically held that “a reasonable jury” could not infer that the multiple threats to kill Kaytor were made “because of Plaintiff’s sex,” and concluded that, absent those threats, the other incidents complained of were not pervasive enough to adversely affect Kaytor’s work environment. The lower court also pointed out that because McCarthy was crass with everyone, regardless of their gender, he was not targeting Kaytor because of her sex.

The Second Circuit disagreed, finding that a rational jury could infer from McCarthy’s sexual comments and inappropriate remarks that the gender neutral threats of violence that he directed toward Kaytor were, in fact, because of her gender. Further, in response to the “Equal Opportunity Harasser” argument, the appellate court pointed out a prior case in which it held that “the inquiry into whether ill treatment was actually sex-based discrimination cannot be short-circuited by the mere fact that both men and women are involved . . . . It would be exceedingly perverse if a male [supervisor] could buy . . . his company immunity from Title VII liability by taking care to harass sexually an occasional male worker, though his preferred targets were female.”

The important issue for employers is that a court’s analysis of whether harassment is “based on sex” will take into account the totality of the circumstances, and will consider both the complainant’s reaction to events and whether a reasonable person would find such events abusive. In addition, evidence that the alleged harasser may have had “designs” on the complainant (as Kaytor alleged that McCarthy had, in this case, based upon his comments about her body and her scent) will add context to other remarks that may not include sexual references or gender-based comment. Importantly, a company must recognize that the fact that an harasser also makes remarks to male employees will not, by itself, serve as a defense to claims for sexual harassment or hostile environment.
 

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The 4th U.S. Circuit Court of Appeals has determined that an alleged harasser who makes gender-specific slurs and comments can create a hostile work environment for a female employee, even though the harasser is an “Equal Opportunity Harasser” who makes sexually offensive remarks to “anybody, any time.” EEOC v. Fairbrook Medical Clinic, P.A., 4th Circ., No. 09-1610, June 18, 2010.

Dr. Deborah Waechter was employed at Fairbrook Medical Clinic, which is owned and run by Dr. John Kessel. During her employment, Waechter was the target of a number of remarks by Kessel having to do with her body, her sexual relationship with her husband, and Kessler’s self-label as a “breast man.” In addition, Kessler made crude jokes to both the men and the women in the office, and reveled in being a “shock jock” who made outrageous remarks to both male and female employees. Waechter ultimately resigned her position and filed a lawsuit against Fairbrook. The lower court granted summary judgment for Fairbrook, dismissing Waechter’s claims with a finding that Kessler’s conduct was not based on Waechter’s gender and was not “severe,” and that it was not uncommon in a medical setting to use off-color jokes to “ease the tension.” The Fourth Circuit disagreed with and reversed that determination.

Title VII of the Civil Rights Act prohibits discrimination “because of sex.” The purpose of this prohibition, according to the U.S. Supreme Court, is to “strike at the entire spectrum of disparate treatment of men and women in employment.” In order to establish a violation of Title VII, an employee must show that the complained-of conduct was unwelcome, was based on her sex, was sufficiently “severe and pervasive” to alter the conditions of her employment and create an “abusive work environment” that was attributable to the employer.

In this case, Fairbrook argued that Kessel did not make the inappropriate remarks to Waechter because of her sex, and argued that Kessel was a generally crude person who made vulgar comments to men and women alike. The Fourth Circuit dismissed that contention, stating that although Kessel made offensive remarks to both men and women, his use of sex-specific and derogatory terms indicated that he intended to demean women. Further, the Court pointed out that Kessel’s proposals of sexual activity were not of the type that would have been made to someone of the same sex, as they involved breast pumping and “wild” sex after pregnancy. Based on these remarks, a jury could reasonably conclude that the purpose of Kessel’s comments was to embarrass and discomfit a woman in his employ.

The Court then addressed the issue of whether Kessler’s comments created an objectively hostile environment. In response to Fairbrook’s argument that employees in a medical clinic deal with human bodies every day and therefore have a more casual response to anatomical references and jokes, the Court responded that Kessel’s remarks went beyond merely crude behavior when they “ventured into highly personal territory,” including Waechter’s pregnancy, her body, and her personal life with her husband. The Court refused to accept the argument that because a medical setting deals with human anatomy on a regular basis, it is somehow “liberated from professional norms.” The Court determined that a jury could find that Kessel’s behavior was sufficiently severe and pervasive to establish an objectively hostile work environment.

While Fairbrook attempted to assert the affirmative defense available to employers since the Supreme Court’s decisions in Faragher and Ellerth in 2008, it was unable to show that it “exercised reasonable care to prevent and correct promptly any sexually harassing behavior.” The clinic never conducted an investigation or took any other corrective actions, in spite of the fact that Waechter complained to Kessel – the owner – on several occasions, and to at least one other manager.

This case raises a number of issues of which employers should be aware. First, the “Equal Opportunity Harasser” defense is not applicable if the remarks made by such a person are gender-based and could be interpreted to shock, intimidate, or alienate an individual of that gender. Second, the casual nature of a workplace is not sufficient to support an argument that harassing and humiliating behavior against one gender is okay. Third, with absolutely no attempt to investigate or otherwise exercise reasonable care to stop the harassment, an employer will be unable to provide the affirmative defense available under the prevailing Supreme Court cases. Antidiscrimination training and policies should be developed and implemented to assist employers in dealing with these issues and in avoiding legal liability for claims of hostile work environment.
 

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It is generally understood that employees can bring claims for hostile environment, wrongful termination, or even “constructive discharge” – where an employee claims that an employer made working conditions so intolerable that a reasonable employee would feel compelled to resign. What is less clearly understood is the extent of the economic damages for which a hospital or health care system may be liable in an employment-related lawsuit. Because a successful litigant in an employment case often is entitled to compensatory damages, lost wages and, in some instances, front pay, a lawsuit by a physician-employee can create the potential for large monetary damage awards. In a clear example of this fact, a Texas jury recently awarded more than $3.6 Million to an Egyptian-born physician who claimed that he was forced to resign after race-based comments from another employed physician. Nassar v. Univ. of Texas Southwestern Medical Center at Dallas, N.D. Tex., No. 08-1337, jury verdict, 5/26/10.

Naiel Nassar, a U.S. citizen since 1990, was born in Egypt and attended medical school there. He then did a medical residency and a fellowship in infectious diseases at the University of California, Davis. In 2001, Nassar was hired by the University of Texas Southwestern Medical Center (UTSW) as an Assistant Professor of infectious disease medicine. Part of Nassar’s duties required that he provide patient care at the Amelia Court clinic, an outpatient HIV/AIDS clinic affiliated with UTSW.

In 2004, UTSW hired Dr. Beth Levine as the chief of its infectious disease program. In that role, Levine directed that Nassar begin billing for the services he provided to the HIV clinic. Nassar objected to the directive, arguing that his salary for clinical services was fully funded by a federal grant, and stating that billing the patients therefore would be “double dipping.” Nassar claimed that Levine also began to “harass” him, making derogatory statement about his race and his Muslim religion, including one comment that “middle easterners were lazy.” His allegations were supported by a clinical supervisor, whose affidavit described a “disconnect between Dr. Levine’s statements and the reality of Dr. Nassar’s work.” Based on his concerns about Levine, Nassar ultimately applied for employment at Parkland Health & Hospital System in 2006. Parkland made preparations to hire Nassar, even drafting a job offer letter, but never formally hired Nassar. Nassar contended that UTSW retaliated against him by blocking the offer from Parkland. Nassar ultimately filed a lawsuit in federal court alleging discrimination and retaliation. Levine strongly disputed Nassar’s allegations, as did UTSW.

At trial, the jury was presented with only two questions: (1) Whether Nassar was constructively discharged because of his race, national origin, or religious preference; and (2) Whether UTSW retaliated against Nassar by blocking or objecting to his employment by Parkland after Nassar complained about his treatment at UTSW. After one hour of deliberations, the jury answered “Yes” to both questions. Two days after the May 24, 2010 verdict, the same jury awarded $3.2 Million in compensatory damages and $438,000 in lost back pay to Nassar. The court now will determine whether Nassar’s claim for lost front pay – which could range from $200,000 to $4 Million – should be paid as part of the award. In addition, Nassar has made a claim for attorney fees, which also will be heard by the court. UTSW has already stated that it will be appealing the verdict and the resulting judgment.

Hospital and healthcare entities that are contemplating direct hiring of physicians should take the time to read the jury instructions and verdict sheet on which the decision in the jury’s decision was based. (Find a copy on my blog at www.employmentlawmatters.net.) Most notable is the court’s instruction in which it defines “constructive discharge” as a resignation from working conditions “so intolerable that a reasonable employee would feel compelled to resign.” The court goes on to point out that to prove constructive discharge, Nassar “need not show that his race, national origin, or religions preference was the sole or even the primary motivation for [UTSW’s] conduct.” He simply had to prove that his protected characteristics “played a motivating part in [UTSW’s] conduct, even though other factors may also have motivated [UTSW].

Employers, including health care entities, should ensure that supervisors and managers are trained to recognize and remedy discriminatory conduct, to assure that such conduct does not become viewed as a “motivating part” of any adverse employment action taken by the employer.
 

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Unless an individual can prove that she is meeting the expectations of her employer, that individual cannot set forth the prima facie case necessary to support a claim of workplace discrimination. The 7th U.S. Circuit Court of Appeals has found that an employee who was fired for insubordination was not meeting an employer’s legitimate business expectations after she engaged in arguments with her co-workers, the general manager, and the owner of the business. The Court further found that the insubordination was a non-discriminatory reason that overcame the employee’s claim that her termination for insubordination was a “pretext” for discrimination. Everroad v. Scott Truck Sys., Inc., 7th Cir., No. 08-3311, May 10, 2010.

Diana Everroad filed a federal lawsuit against her former employer, Scott Truck Systems, Inc., and against the company’s general manager, who also was the wife of the company’s owner. Everroad claimed that she had been discriminated against because of her age and gender, and that she was retaliated against for reporting that discrimination. The lower court granted summary judgment in favor of the defendants, and that decision was upheld on appeal.

Scott Truck is a family-owned and operated commercial trucking company. Everroad was hired as a dispatcher in 2004 – at the age of 51 – by defendant Hantzis, the general manager and wife of the owner, David Scott. Within the first months of her employment, Everroad experienced conflicts with her co-wrokers, and was complained about by two of the Company’s largest customers. Scott and Hantzis ultimately moved Everroad from the dispatcher position to a newly created “data administrator” job with the same pay and hours, but with a more flexible schedule. In her new position, Everroad worked in close proximity with a younger female employee who, according to Everroad overused the phone for personal calls. She complained to Scott and Hantzis, who called a meeting with Everroad and the co-worker to attempt to resolve the issue. The Court colourfully described the meeting by saying that “Voices were raised, accusations were exchanged, tears were shed, and eyes were rolled.” Apparently, it didn’t go well. Upset by Everroad’s antics, and concluding that Everroad had been insubordinate, Scott and Hantzis decided to terminate her employment. When they informed her of that fact, Everroad told Scott that he and his wife were “nuts, crazy, insane” and “sick” and called Hantzis a derogatory female term, beginning with the f-word as a descriptive adjective. Later that evening, Everroad called Scott, asking for severance pay. Scott declined.

The Company’s motion for summary judgment against Everroad’s ensuing lawsuit was granted, and the case was dismissed. On appeal, the Seventh Circuit found that Everroad’s insubordination undermined the discrimination claims in two ways: first, insubordination precluded Everroad from proving that she “met her employer’s legitimate job expectations,” which is an element of the required prima facie case; second, insubordination is a non-discriminatory reason for termination, which meant that Everroad was unable to show that the Company’s actions were simply a pretext for discrimination. Further, although Everroad claimed that she was treated differently than “similarly situated” male/younger employees, she was unable to show that anyone else had been similarly insubordinate and treated more favourably.

Insubordination is a non-discriminatory reason for termination in most circumstances. The relevant inquiry at the summary judgment level is not whether a reasonable jury would conclude that an employee’s conduct was insubordinate, but whether the employer genuinely believed it to be so at the time of the complained-of adverse action. A jury may disagree with a company’s decision to terminate an employee for insubordination or may think that the decision was in error, but so long as the employer “genuinely believed the truth of their stated reason for the decision,” the reason is not pretextual, and the employee will be unable to prove discrimination. The most effective way to support an employer’s genuine belief is complete, contemporaneous, and objective documentation of the employee actions and statements on which the decision is based.
 

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In a case in which over $3 Million in compensatory damages already had been awarded to a group of 12 female former employees claiming gender discrimination, the same jury awarded $250 Million in punitive damages to a class of 5600 female employees and former employees of Novartis Pharmaceutical Corporation for the same claims. Velez v. Novartis Pharma. Corp., S.D.N.Y., No. 04-civ.9194, punitive damages verdict 5/19/10. The case, filed as a class action in 2005 in the Southern District of New York, was a “sex plus” case, meaning that the gender discrimination was brought in tandem with related claims, such as pregnancy discrimination or family leave interference. The plaintiffs in the case against Novartis made claims based upon unequal pay, lack of promotion, and adverse treatment after pregnancy leave.

The number of “sex plus” cases has risen steadily over the past ten years, but the verdict and damages against Novartis has eclipsed previous verdicts. The claims against that company included a demand for monetary damages, along with a restructuring of Novartis’ pay and promotion practices. Novartis, which has been on a national “best companies for working mothers” list for over 10 years, defended against the claims by citing its policies and procedures, and by arguing that while 70 percent of its sales representatives are men, that dis-proportionality was not the result of discrimination.

After a six-week trial, a unanimous jury awarded $3.3 Million as compensatory damages to the 12 named plaintiffs in the case, finding that the women had been treated differently than their male counterparts. Compensatory damages are damages for actual losses, but can include amounts for “pain and suffering,” as well. Because that award opens the door for others in the 5600-member class to claim compensatory damages of their own, the total damages in this case could conceivably approach – and possibly exceed - $1 Billion.

While there is a question regarding whether the jury’s verdict in the case will be upheld on appeal, the jury’s message should be received and understood by employers: claims of widespread discrimination – whether real or perceived – should be investigated, remedied, and kept from reoccurrence. This case comes at a time when the Obama Administration has taken an aggressive stance on an issue that it perceives to require that attention. Federal courts are responding to this attention, and have become more likely to grant class certification in cases that historically have been brought as single-plaintiff claims, or by small groups of employees. The 9th U.S. Circuit Court of Appeals recently ruled that a “gender plus” discrimination claim that could eventually involve as many as one million current and former female employees of Wal-Mart can go forward as a class action in federal court in California.
 

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The EEOC announced on May 5, 2010 that Ohio-based Everdry Marketing and Management, Inc., has paid over $500,000 in damages in interest to satisfy a judgment against that company stemming from a 2006 jury trial. The original claims were filed by 13 women, mostly teenagers at the time of the incidents, who worked at the company’s Rochester, N.Y., location as telemarketers. EEOC v. Everdry Mktg. & Mgmt., Inc., W.D.N.Y., No. 01-cv-6329, judgment satisfied, 5/5/10.

The case originally was filed by the EEOC in 2001 as part of its “Youth@Work” initiative, targeted at training young people about illegal workplace discrimination and harassment. The complaint included claims that male managers and co-workers at the Rochester franchise of Everdry verbally and physically harassed the young women between 1998-2002, making numerous sexual remarks and jokes, and on one occasion, promising a raise in return for sexual acts. Following a multi-week trial in federal court in New York in October of 2006, a jury originally awarded $585,000 in damages to the 13 plaintiffs; that amount ultimately was reduced to $471,096. The jury concluded that the Rochester affiliate at which the incidents occurred was part of an “integrated enterprise,” and that Everydry therefore violated Title VII of the Civil Rights Act by allowing the harassment.

Afterwards, Everdry appealed the verdict on the basis that as a franchise, the Rochester affiliate was not part of the Everdry company. The 2d U.S. Circuit Court of Appeals rejected that argument and affirmed the jury verdict, specifically affirming the award of punitive damages assessed by the jury against the company. Everydry corporate headquarters has paid the judgment - although none of the complained-of incidents occurred at its corporate facilities in Ohio - plus $86,581 in post-judgment interest. The Rochester affiliate is no longer in operation.

This case points out two things: first, that sexual harassment training is extremely important, especially if a company has related or affiliated entities in other geographic locations, and for which it ultimately may be held responsible; and second, that the EEOC is persistent in enforcing federal laws banning workplace discrimination.
 

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The 4th U.S. Circuit Court of Appeals has reversed a lower court’s summary judgment in favor of an employer who required a female employee to take a physical ability test after an on-the-job injury, even though it did not require such a test for similarly situated male employees. Merritt v. Old Dominion Freight Line Inc., 4th Circ., No. 09-1498, April 9, 2010.

Deborah Merritt worked for Old Dominion Freight Lines as a Line Haul driver. While Line Haul drivers spend nights and weekends away from home, driving across state lines, Old Dominion also had Pickup and Delivery drivers who worked locally and rarely had to work nights or weekends. In 2002, after six years as a Line Haul driver, Merritt began to apply for a Pickup and Delivery job, in order to spend more time with her family. She claimed that she applied for several open Pickup and Delivery positions, but that less-experienced male drivers were hired. Merritt alleged that she was told by a terminal manager that the company didn’t want women in the Pickup and Delivery jobs - which required more lifting – because management was afraid that a woman “would get hurt.” Of the company’s 3100 Pickup and Delivery drivers, only six were female.

In March 2004, Merritt was hired as a Pickup and Delivery driver, but not until two male Pickup and Delivery drivers were asked how they would feel about working with a woman. (They responded that they would have no trouble doing so.) Merritt was then put on a 90-day probation period which, she alleged, was not the typical procedure for new Pickup and Delivery drivers. By all reports, Merritt performed her new job successfully, and received no complaints from customers or co-workers. During this initial time frame, however, the terminal operations manager allegedly told a male driver that “this is not a woman’s place.”

In September 2004, Merritt suffered an ankle sprain at work and also was diagnosed with plantar fasciitis. Her doctor prescribed light duty work until a December 27 appointment. At that appointment, the doctor concluded that Merritt’s injury was “not a disabling condition,” and that she could return to work without restrictions. Just prior to that appointment, however, the company’s vice president of safety and personnel decided that Merritt would have to pass a Physical Ability Test (PAT) before she was allowed to return to work. The test was administered on December 28, immediately after Merritt’s full release to return to work, and the company determined that Merritt failed the test. While the test showed no restrictions related to Merritt’s ankle injury, it indicated that the 5 foot, 1 inch Merritt was unable to place a particular box on an overhead shelf, and had difficulty walking backward pulling a cable (Merritt testified that the test occurred in a hallway full of people, and that she bumped into several of them). On the basis of that test, Merritt was fired for “inability to perform job.” She sued under Title VII, claiming gender discrimination.

Although the lower court granted summary judgment to Old Dominion, that decision was reversed by the Fourth Circuit. The appellate court determined that a reasonable jury could find that the evidence presented by Merritt undermined Old Dominion’s assertion that it had a “regular policy” of requiring drivers to pass a PAT before returning from injury-related absences. In fact, the company used the test inconsistently, and injured male drivers often returned to work without taking such a test. Further, the company did not use the PAT – which originally was developed for new applicants - to test Merritt’s return from her ankle injury, but applied the test for strength and coordination. Therefore, the Court found that, given the earlier statements by other managers that the Pickup and Delivery job was not suitable for women, in light of the dearth of females in that position, and considering that the PAT was used only on an intermittent basis and then typically for new hires, a reasonable jury could find that gender discrimination may have been the real reason for Merritt’s termination.

The Court’s opinion and comments create a road map for companies who are serious about instituting a safety-based testing program. According to the Court, a neutral policy which served the company’s legitimate business and safety interests could have withstood legal challenge. However, Old Dominion’s selective use of the PAT, along with the company’s changing rationales for its use, possible sexist remarks, and a statistical lack of females in the subject position all could indicate to a jury that the company was reserving the more desirable “Pickup and Delivery” positions for male drivers.
 

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Under certain circumstances, 42 U.S.C. §1981 (Section 1981) creates a federal cause of action for individuals claiming intentional racial discrimination. To support such a claim, a plaintiff must allege that he is a member of a racial minority, and that he was discriminated against within a particular group of activities set forth in the statute. Those activities include the right to “make and enforce contracts . . . as is enjoyed by white citizens.” The 11th U.S. Circuit Court of Appeal recently dismissed the claims of a physician who claimed that the suspension of his medical staff privileges violated rights protected by Section 1981, holding that such privileges did not constitute contractual rights as defined by the statute. Jimenez v. Wellstar Health System, 11th Cir., No. 09-10917, February 18, 2010.

Dr. Omar F. Jimenez, an African-American physician with a specialty in neurosurgery, held medical staff privileges at Wellstar Health System in the state of Georgia. In January 2006, Jimenez was asked to appear before Wellstar Surgery Department’s Medical Care Evaluation Committee to address a number of complaints received by the Committee regarding Jimenez’ medical performance. The complaints included allegations that Jimenez had failed to respond promptly to emergency room calls, had failed to make patient rounds in a timely manner, and had failed to manage certain surgeries appropriately. Based on those allegations, Wellstar suspended Jimenez’ medical staff privileges, which meant that Jimenez was precluded from treating patients at Wellstar’s hospitals. Although Jimenez initially requested a hearing on the suspension, a year went by within which no hearing was held, for reasons for reasons not explained in the Court’s opinion. At that point, Jimenez withdrew his request.

Jimenez ultimately filed a federal law suit, including a claim under Section 1981 alleging race discrimination based upon contractual rights. He claimed that Wellstar discriminated against him when it suspended his privileges and when it delayed a hearing on that suspension, and that those privileges established a contract between Jimenez and Wellstar. The district court dismissed the lawsuit for Jimenez’ “failure to state a claim,” and the case was appealed. The Eleventh Circuit upheld the dismissal, finding that the suspension of Jimenez’ medical staff privileges did not violate rights protected under Section 1981.

Wellstar’s policies include specific language that membership on the system’s medical staff “does not create a contractual relationship between Wellstar or any Medical Staff and the Medical Staff Member.” In addition, medical staff members at Wellstar must meet certain minimum objective criteria, and failure to do so can result in automatic termination of medical staff privileges, which runs counter to a typical contractual relationship. Importantly, under Georgia state law, medical staff bylaws do not create a per se contractual right to the continuation of medical staff privileges. According to the Court, interpreting the bylaws as a contract in Jimenez’ case would run counter to the state’s policy of allowing a hospital to suspend or withhold privileges from doctors that it believes are unqualified to serve on its medical staff. Therefore, Jimenez did not the possess the contractual relationship necessary to support his Section 1981 claim.

It is noteworthy that because Jimenez was not an employee of Wellstar, he was unable to base his claim for racial discrimination on Title VII of the Civil Rights Act, the federal “anti-discrimination” statute which prohibits race and national origin discrimination (as well as gender and religious discrimination) by employers against employees. Had Jimenez been a direct employee of the hospital system, the fact that his medical staff privileges did not constitute a contract would not have precluded a federal claim by Jimenez, because Title VII would have been available to him. Health care providers that are moving toward an employment model with physician staff members should take this issue into consideration and should assure that managers and supervisors are trained to recognize and resolve complaints of discrimination when they arise, in order to avoid legal liability under Title VII, regardless of whether Section 1981 applies.
 

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Under Title VII, an unlawful employment practice is established when an employee demonstrates that gender is a motivating factor for an adverse employment action. Under that analysis, the 8th U.S. Circuit Court of Appeals has upheld the Title VII claims of a female hotel desk clerk who was fired after a company decision-maker complained that the employee lacked the pretty and “Midwestern girl” look desirable in a front desk employee. Lewis v. Heartland Inns of America, L.L.C., 8th Cir., No. 08-3860, Jan. 21, 2010.

Brenna Lewis began working for Heartland Inns of America in July 2005, starting out as a night auditor. In that job, Lewis worked the front desk from 11 p.m. to 7 a.m., doing it well enough to receive two merit-based pay raises and positive customer feedback.

In December 2006, Lewis’ manager, Lori Stifel, received permission over the telephone from the company’s Director of Operations, Barbara Cullinan, to offer to Lewis a daytime (7 a.m. to 3 p.m.) shift position on the front desk. Lewis accepted, and took over that position at the end of December. Although Cullinan initially had approved Lewis’ move to the day shift, her attitude changed after she met Lewis in person. At that point, Cullinan told Stipel that she wasn’t sure that Lewis was a “good fit” for the position, as Lewis lacked the “Midwestern girl” look that Cullinan felt was necessary at the front desk. By her own admission, Lewis is “slightly more masculine,” avoids makeup, and wears mens’ button down shirts and slacks. She has been mistaken for a male, and has been referred to as “tomboyish.” However, while Cullinan felt that front desk staff should be “pretty,” the front desk job description in Heartland’s personnel manual does not mention appearance.

Cullinan ordered Stifel to return Lewis to the overnight shift. When Stifel refused, Cullinan insisted that Stifel resign. Cullinan then required Lewis to re-interview for the day shift position, even though Lewis had held the position successfully for over a month. Lew protested, but attended the interview. Three days later, Lewis was fired. In its termination letter, Heartland stated that Lewis was “hostile” toward company policies and had attempted the “thwart” the interview process. Lewis then filed a lawsuit, asserting that Heartland fired her for not confirming to sexual stereotypes, and claiming that such conduct violated Title VII. The lower court disagreed and entered summary judgment in favor of the company. On appeal, the 8th Circuit reversed that decision, holding that sexual stereotyping can violate Title VII when it influences employment decisions.

Title VII prohibits discrimination based upon sex. In this case, Lewis provided evidence that Heartland found her unsuited for her front desk job based, not upon her work performance, but upon an appearance that was inconsistent with the company’s preferred feminine stereotype. At the summary judgment phase of a case, the question is whether a plaintiff has offered sufficient evidence from which a reasonable fact finder could find that the individual was discriminated against because of her sex. Here, the 8th Circuit found that Cullinan’s remarks, along with her discharge of Stifel for not taking Lewis off the front desk, and her imposition of a second interview even after Lewis performed successfully in the position, clearly provided such evidence.

The line between sexual orientation – which is not yet prohibited by federal law – and discrimination “because of sex” can be difficult to draw. However, employers must recognize that an employer who takes an adverse action against an individual because he or she does not fit within sexual stereotypes is engaging in sex discrimination because that discrimination would not have occurred but for the individual’s sex. If a company’s disciplinary actions are meant to punish or belittle non-compliance with gender stereotypes, the actions may constitute a violation of Title VII’s “because of sex” provision.
 

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A former editorial writer for the Indianapolis Star who claimed that she lost her job because of her “traditional” Christian beliefs regarding homosexuality was unable to support claims of religious discrimination under Title VII, because she could not show that she met the legitimate business expectations of her employer. Patterson v. Indiana Newspapers, Inc., 7th Cir., No. 08-2050, December 8, 2009.

Linda Coffey worked as an editorial writer for The Indianapolis Star and claims that she left the newspaper as a victim of employment discrimination. Coffey alleged that she was discriminated against because she is a Christian who believes that homosexual conduct is sinful. After she filed a lawsuit, the district court entered summary judgment in favor of the newspaper. That ruling was affirmed on appeal to the 7th U.S. Circuit Court of Appeals. (Note that Coffey filed her lawsuit along with another Star employee, James Patterson, who claimed age, race, and religious discrimination. His claim was dismissed, as well.)

The Indianapolis Star is that state’s largest newspaper. In 2003, Dennis Ryerson was named as the Star’s editor and vice president, and was responsible for newsroom staffing and editorial content. In that same year, Ryerson and Coffey, who was a member of the editorial department at the time, engaged in an e-mail exchange related to an editorial proposed by Coffey on the Supreme Court’s decision in Lawrence v. Texas. In that case, the Supreme Court held that the right to privacy protects adults engaging in private, consensual homosexual activity. Coffey, who describes herself as a “traditional Christian,” proposed an editorial that described, in graphic detail, HIV risks associated with such activity. Although Ryerson refused to publish that column, he said that he was open to publishing a less graphic column on the risks of unprotected sex. That refusal triggered an e-mail exchange that Ryerson perceived as an attempt by Coffey at workplace proselytizing, which he warned Coffey was inappropriate.

During this same period, Coffey had developed a habit of violating the Star’s overtime policy by failing to have her overtime pre-approved. Although she was warned of this violation, Coffey continued to do extra work without pre-approval, often submitting hours that were viewed by the paper as “excessive and unnecessary.” In September 2003, administrative oversight for the Star’s internship program was transferred from Coffey to the newsroom editor, leaving Coffey with a less than full-time position. Although Ryerson offered Coffey a full-time position on the copy-desk, Coffey preferred editorial writing and resigned rather than transfer. On her last day at the Star, Coffey sent an e-mail stating that she had “enjoyed and appreciated” her work on the paper. However, in her lawsuit, Coffey claimed that the proposed transfer to the copy department was an adverse action, based on religious discrimination.

The Seventh Circuit upheld the dismissal of Coffey’s claims, stating that Coffey could not show that she met the Star’s legitimate performance expectations, because the undisputed evidence showed that Coffey continually had violated the paper’s overtime policy. Further, to the extent that Coffey claimed that Ryerson would have permitted someone who did not share Coffey’s religious views to remain in the editorial department notwithstanding violation of company rules, Coffey failed to show that a similarly situated employee (an editorial writer who repeatedly violated overtime rules) who did not hold her same religious beliefs (that homosexual conduct is “sinful”) was treated more favorably and, therefore, Coffey was unable to support her prima facie case of religious discrimination. Moreover, Coffey’s claim of “constructive discharge” was belied by her final e-mail, which expressed no complaint or concerns.

While claims of religious discrimination should be taken seriously by employers, such claims do not overshadow an employee’s duty to meet legitimate job responsibilities. In order to effectively establish the defense asserted by the Star in this case, an employer should have a written job description that sets forth the responsibilities of the employees. In addition, clear, objective, and complete records of the individual employee’s performance should be made and kept by the employer, in order to support the assertion that the employee has not met the employer’s legitimate expectations. In this case, documentation of meeting and warnings associated with Coffey’s violation of the overtime policy was critical in establishing Coffey's failure to meet her employer’s expectations.
 

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In an unpublished opinion, the 3d U.S. Circuit Court of Appeals has reminded employers of the importance of acting consistently with written policies, and of documenting that action. Coleman v. Blockbuster, Inc., 3d Circ., No. 08-4056, November 17, 2009. In that case, the Court upheld summary judgment in favor of an employer on the basis of the company’s ability to support its proffered “legitimate business reason” for the termination of a company manager for closing a store early and leaving the premises for a family emergency.

Tyra Coleman, an African American female, was hired by Blockbuster in September 2003 and was promoted to the position of store manager a few months later. However, after a series of disciplinary actions, Coleman was fired on June 22, 2004. In April 2004, Coleman had received two written “Corrective Action Reports” (CARs) for her store’s poor operational performance. On June 11, she received a third CAR when she missed a mandatory team meeting, and brought her two-year-old grandson to work with her. The third CAR was treated as a last chance agreement and read, in part, “Failure to improve will result in termination of employment.” On June 15, 2004, Coleman closed the store early and left the premises, ostensibly because of a medical emergency involving her minor son. Her employment was terminated the following week.

Coleman ultimately filed a lawsuit, claiming that the actual reason for her termination was race discrimination. The district court granted summary judgment in favor of Blockbuster; that decision was upheld on appeal.

Employment discrimination claims typically are analyzed under a “burden shifting” framework which requires an employer to offer a legitimate business reason for its action. In this case, Blockbuster argued that it acted pursuant to its written policy of progressive discipline. Coleman countered that the company acted “too harshly” when it fired her for her son’s emergency, and asserted that such harshness was an indication that the firing was racially motivated.

The Third Circuit pointed to the fact that whether or not Coleman believed her termination to have been “harsh,” she was unable to demonstrate that Blockbuster treated her less favorably than other, non-minority employees. To the contrary, the Court found that “Blockbuster came forward with solid evidence to demonstrate that the reason for Coleman’s termination was her dereliction of duty.” The Court pointed out that the company’s operating procedures allow the company certain discretion in its disciplinary measures, including the application of “more stringent penalties” for an employee – like Coleman - who already is in the progressive disciplinary system at the time of an additional infraction. While Coleman disputed certain factual evidence, she was unable to show any evidence that even suggested that her termination was motivated by her race, and not by her “dereliction of duty,” as stated by the company.

There is no doubt that Blockbuster’s documentation of its disciplinary actions, and its compliance with its progressive disciplinary policy (which gave it broad discretion to accelerate disciplinary measures when deemed appropriate) were the keys to its success against Coleman’s claims of discrimination in this case.
 

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Courts typically have dismissed discrimination claims under Title VII if those claims were made by an independent contractor, rather than by an “employee” of the company. However, 42 U.S.C. §1981 (“Section 1981”), which prohibits racial discrimination in the formation of contracts, states that “all persons” shall have the same right “to make and enforce contracts as is enjoyed by white citizens.” In a case of first impression for the 3d U.S. Circuit Court of Appeals, that court has followed prior decisions of three sister-appellate courts in holding that an independent contractor may sue for race discrimination under Section 1981. Brown v. J. Kaz, Inc. d/b/a Craftmatic of Pittsburgh, 3d Circ., No. 08-2713, Sept. 11, 2009.

Craftmatic is a distributor of adjustable beds that sells its product through sales representatives. Those representatives schedule their own appointments to visit potential customers’ homes, provide their own equipment and means of transportation for those sales calls, and are paid on commission. Each sales person signs an “independent contractor” agreement with Craftmatic.

In 2006, Kimberly Brown, an African-American female, responded to an ad in which Craftmatic was seeking sales representatives, and then registered for a three-day training and an interview session in Pittsburgh with the company. Brown traveled by bus to Pittsburgh from her home in Cleveland for the session – she testified that the reason was that she preferred not to drive in unfamiliar places. She attended the training with two male applicants, neither of whom was African-American. Regarding his initial meeting with Brown, Craftmatic’s recruiting manager, Jay Morris, later stated that he knew that she was “going to be a headache” because she “asks a lot of questions.”

On the final day of training, Morris approached the applicants, and extended his hand to all three. He shook hands with the two men and exchanged pleasantries with them. For unexplained reasons, Brown refused to shake Morris’ hand. Morris responded with a remark, the content of which is disputed. Brown states that the remark was a racial slur, while Morris says that he was expressing his disappointment that Brown refused to shake hands, equating it to a racial rebuff. This exchange was followed by some heated words, during which Morris stated that if he had any voice in the decision, Brown would not work for Craftmatic. With input from Morris, the company ultimately decided not to use Brown as a sales representative.

Brown ultimately sued Craftmatic, claiming race discrimination under Title VII, the Pennsylvania Human Relations Act, and Section 1981. The district court dismissed the Title VII and PHRA claims on the basis that Brown was not an employee. That court also ruled that while Brown’s independent contractor status did not preclude her from bringing claims under Section 1981, Brown did not provide evidence sufficient to support her claims under that statute. The Third Circuit disagreed, taking issue with the lower court’s conclusion that Craftmatic would have been equally concerned with Brown’s behavior, even if no racial slurs were made. The appeals court said that instead, the real question was whether the same decision would have been made if Brown’s race was “taken out of the equation” altogether. The Third Circuit then reversed the summary judgment on the Section 1981 claim, allowing that claim to go forward.

The Third Circuit’s decision does not mean that Brown has proven her case of discrimination. What it means, however, is that there are disputed issues of fact, and that those issues should be decided by a jury. The primary take-away from this case is that an independent contractor can bring a racial discrimination claim under Section 1981 against a company that allegedly discriminates in the formation of its contracts, even without an actual employee/employer relationship. Companies that regularly rely on such contractors should be sure that hiring, training, and terminations are done consistently and in a non-discriminatory manner, in order to avoid the issues presented in this case.
 

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Congress has repeatedly rejected legislation that would extend Title VII protection to claims of sexual orientation discrimination. However, under Title VII, an employee may raise a claim of gender discrimination if that individual can demonstrate that an harasser was acting to punish the employee’s noncompliance with gender stereotypes. The 3d U.S. Circuit Court of Appeals has allowed the claim of a self-described “effeminate man” to move forward to a jury trial, on the basis that the plaintiff presented evidence that his co-workers harassed him because of his non-compliance with male-associated stereotypes. Prowel v. Wise Business Forms, Inc., 3d Cir., No. 07-3997, August 28, 2009.

Brian Prowel was one of 145 employees of Wise Business Forms in Butler, Pennsylvania, and had worked for the company since 1991. Prowel, an openly gay male, felt that his mannerisms caused him not to “fit in” with the other men at Wise. He described his male co-workers as “blue collar,” “very rough around the edges,” and “everything I wasn’t.” In stark contract, Wise had a high-pitched voice, walked and carried himself in an effeminate manner, and filed his fingernails “instead of ripping them off with a utility knife.”

Some of his co-workers reacted negatively to Prowel’s demeanor and appearance, calling him “Princess” and “Rosebud” and making fun of the way he talked, walked, and sat. Prowel complained to his supervisors, but the harassment continued. In April 2004, Prowel became so unhappy with his work environment that he considered suing the company and said so to certain co-workers. Prowel subsequently was asked to meet with his supervisors and was asked about approaching those individuals regarding his proposed lawsuit. In December 2004, Prowel was terminated “for lack of work.”

Prowel then sued Wise in federal court. His claims included gender discrimination and retaliation claims under Title VII. The lower court found that Prowel’s claims were based upon sexual orientation – not a viable claim under Title VII – and dismissed the suit. On appeal, the Third Circuit reversed, finding that Title VII does not bar a homosexual man from bring a gender stereotyping claim under the Act, since such a claim is “because of” the plaintiff’s sex, a type of discrimination barred by law.

The Third Circuit pointed out the U.S. Supreme Court’s opinion in Price Waterhouse v. Hopkins, 490 U.S. 228 (1989), in which a female was denied a promotion because she failed to conform to gender stereotypes. Hopkins used profanity, was not “charming,” and did not walk, talk, or dress in a feminine manner. The Supreme Court found that when an employer acts on a belief that a woman cannot be aggressive, it has discriminated “because of sex” and has violated Title VII.

Similarly, the evidence set forth by Prowel indicates that he was harassed and treated differently because he did not conform to his co-workers’ vision of how a “man” should look, speak, or act. Therefore, Prowel marshaled enough evidence to argue that his harassment was based on gender stereotypes, even if part of the harassment was based on his sexual orientation.

The line between sexual orientation discrimination and discrimination “because of sex” can be difficult to draw. Under Title VII, an unlawful employment practice is established when the plaintiff demonstrates that sex was one of the motivating factors for discrimination, even if other factors - including harassment based on sexual preference - also motivated the same actions.

Employers should be aware of this decision, and should understand that while sexual orientation is not yet included as a protected category under federal law (although it is protected under some state statutes), gender stereotyping is a very closely related cause of action. Therefore, employee complaints of harassment should not be overlooked or downplayed on the basis that they appear to involve an issue of sexual orientation. (Of course, employee complaints should never be “overlooked or downplayed” under any circumstance.) Instead, if any of the complained-of activity includes actions that are meant to punish or belittle non-compliance with gender stereotypes, the actions may constitute a violation of Title VII’s “because of sex” provision.
 

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When an individual claims to have been racially harassed by co-workers, he or she must show that the employer was negligent either in discovering or remedying the harassment. An employer can avoid liability for co-worker harassment if it takes prompt and appropriate remedial action that is likely to prevent the harassment from recurring. Recently, the 7th U.S. Circuit Court of Appeals analyzed specific actions taken by a company after a noose was found hanging in a workplace, and found those actions to have been sufficient to uphold summary judgment in the company’s favor. Porter v. Erie Foods International, Inc., 7th Cir. No 08-1996, August 7, 2009.

Tremeyne Porter was the only African-American working on the third shift in Erie Foods’ Rochelle, Illinois facility. During his work shift on August 12, 2004, Porter saw a noose, made out of white nylon rope, hanging from a piece of machinery. An on-site supervisor, Santos, directed another employee to take down the noose, and then discussed the matter with Porter. She asked Porter if he knew who was responsible, but he denied knowing who the perpetrator was. Santos then tacked the noose to a bulletin board in her office, which was within sight of individuals passing that office. She later testified that she did so to remind her to follow up on the issue.

Early the next morning, Santos followed up with the first shift supervisor – asking if he had any information about the noose – and then informed her own supervisor (Jacobs) and a member of the human resources department (Goffinet) about the matter. Concerned, Goffinet immediately spoke to his own supervisor about the matter. That evening, Goffinet held a group meeting with Santos, Porter, and the entire third shift, stating that workplace harassment would not be tolerated, and reiterating the company’s anti-discrimination policy. Subsequently, Goffinet spoke privately with nine of the 15 third-shift workers, and held an extensive discussion with Porter. Porter told Goffinet that he “would not say” who made the noose, because he didn’t want anyone to be fired.

Around this same time, another co-worker, Alverez, showed a noose to Porter and to some other employees; Alverez then stated to Porter that if Porter showed the noose to anyone, he would “look for him,” which Porter interpreted as a threat to him and to his family. Shortly after, Goffinet followed up with Porter, asking for additional information on the reported harassment. During that meeting, Porter mentioned that he had been threatened by another employee, but would not identify that person. Goffinet then asked whether Porter wanted to change shifts. Porter declined the offer. Santos also continued to follow up with Porter during subsequent shifts, asking whether he knew who hung the noose, and asking first and second shift supervisors if they had obtained any further information.

On August 14, Porter filed a police report about the nooses, including co-worker names, but stated that he did not want the police to visit the workplace or the individuals – he simply wanted the harassment to stop. On August 16, a locker fell on Porter while he was changing into his work clothes. Porter was hit by the falling locker, but suffered no injury. After Porter reported the incident to Santos, Goffinet had the lockers bolted to the wall within a day.

On August 19, Porter quit his job. He ultimately filed a lawsuit alleging race-based harassment, constructive discharge, and retaliation. The district court granted summary judgment in Erie’s favor. That decision was upheld on appeal by the Seventh Circuit, based largely on the actions taken by Erie during the brief period of Porter’s employment.

Because Title VII is not a “strict liability” statute, an employer can defend against allegations of co-worker harassment by showing prompt and effective response to reports of such harassment. In this case, the Court determined that the steps taken by Santos and Goffinet show that they took the issue seriously and made a reasonable effort to bring the harassment to an end. (However, the Court also labeled Santos’ unfortunate placing of the noose on her bulletin board as “ill advised,” and found that it may have indicated a “lack of recognition of the powerful message of racial hatred that a noose evokes.”) The facts that both of these managers informed their own supervisors of the incident, made attempts to find out who was responsible, reminded employees of company anti-discrimination policies, and followed up with Porter, formed the basis of prompt and effective remedial action sufficient to defend against Porter’s claims of co-worker harassment. Further, because an employee has a duty to reasonably “avail [himself] of the employer’s preventive or remedial apparatus,” Porter’s failure to fully report or cooperate in the investigation of the harassing incidents undermined his claims. According to the Court, an employee’s subjective fears of confrontation or retaliation does not alleviate the duty to alert an employer to alleged harassment.

The important point for employers in this case is the Court’s statement that “In assessing corrective action, our focus is not whether the perpetrators were punished by the employer, but whether the employer took reasonable steps to prevent future harm.” Those “reasonable steps” will differ, depending on the specific facts of the situation being addressed. However, the actions taken by the company in this case should stand as a minimum checklist of a “prompt and effective” reaction to incidents of co-worker harassment.
 

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The basis of an employer’s liability for a claim of hostile work environment under Title VII depends upon whether the harasser is the complainant’s supervisor or merely a co-worker. When a hostile work environment is created by a co-worker, the employer is liable only if the employer failed to provide an avenue for reporting the harassment, or if the employer knew or should have known of the harassment but failed to take prompt and appropriate remedial action. Under Title VII, an employer “knew or should have known” about workplace harassment if “management level employees had actual or constructive knowledge about the existence of a sexually hostile environment.” Therefore, once a management level employee has enough information to raise the probability of sexual harassment in the mind of a reasonable employer, the employer is deemed to be on constructive notice of that harassment.

Recently, the 3d U.S. Circuit Court of Appeals affirmed summary judgment in favor of an employer, holding that the individual team leaders who were aware of certain harassing behavior were not the “management level personnel” referred to in Title VII and, therefore, that the employer could not be held liable for the claims of harassment made by the plaintiff. Huston v. Proctor & Gamble Paper Products Corp., 3d Circ., No. 07-2799, June 30, 2009.

Priscilla Huston was employed by Proctor & Gamble’s Mehoopany, Pennsylvania plant for more than 10 years, working as a technician on teams that operated large paper manufacturing machines. In 2004, Huston allegedly heard about a number of instances in which certain of her male team members exposed themselves to other male employees. She reported those specific incidents only to her team’s “process coach” (Romanchick) and a “machine leader” (Traver), but not to senior management. Huston alleges that she subsequently witnessed two similar incidents herself. She reported those two incidents to a senior-level manager and a human resource manager. An investigation was begun on the day that the incidents were reported. Discipline ultimately was imposed to all team members, including Huston, after it was discovered that the entire team used vulgar language at work – a practice that the company had been working to eliminate. Although Huston’s disciplinary history was such that she could have been terminated for this infraction, she was simply asked to be “mindful of her language” at work.

In the fall of 2004, P&G identified a costly problem occurring at the plant, and was able to trace the problem to a lack of care on the part of the technicians, including Huston. At that point, all technicians were informed that they risked termination if caught fabricating data for machine data logs. In spite of this warning, Huston admittedly falsified certain data into the logs, and was terminated from employment. She then filed a complaint asserting a sexually hostile environment, claiming that Romanchick and Travers were “managers” who put the company on notice of the plant’s hostile environment, and that the company should have acted sooner with respect to the hostile environment.

The Third Circuit affirmed a lower court’s dismissal of the case, finding that Romanchick and Travers did not qualify as management-level employees for purposes of Title VII and, therefore, that the company was not on notice of the hostile environment until Huston reported it to senior management. Unlike salaried managers, Romanchick and Travers were paid on an hourly basis, and had no actual authority to hire, fire, or discipline others. Instead, they performed essentially the same functions as the remaining team members, with certain additional oversight functions. According to the Court, an employee’s knowledge of sexual harassment may be imputed to the employer only when (1) that employee is sufficiently senior in the employer’s governing hierarchy so that such knowledge is important to that person’s general managerial duties; or (2) the employee is specifically employed to report or respond to sexual harassment.

This case provides a bright line definition of “managerial employee” with respect to Title VII’s use of that term by requiring knowledge of a hostile environment to reach an employee in the “governing body” of the company, as opposed to a mere “supervisory employee in the labor force.” According to the Court, “[a]lthough an employer has a duty to be reasonably diligent in attempting to discover co-worker harassment, an employer is not expected to know every instance of harassment that may occur between co-workers.” While this should not be read as permission to ignore or minimize instances of harassment that come to light, it allows employers to fully understand their duty under Title VII, and to respond effectively when allegations of sexual harassment are properly raised.
 

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Recently, the 10th U.S. Circuit Court of Appeals reviewed a company’s testing and interview procedure for new hires, and decided that certain subjective hiring criteria did not necessarily create a mechanism for excluding female applicants. That review occurred in the context of a lawsuit brought by a female applicant who alleged gender discrimination when the Public Service Company of Colorado (PSCo) refused to hire her for an entry level position at its power plant. Turner v. Public Service Co. of Colorado, 10th Cir., No. 07-1396, April 28, 2009.

Susan Turner applied for a “Plant Specialist C” position at PSCo’s Comanche Power Plant in 2000, 2004, and 2006. To evaluate applicants for this position, PSCo used a 3-step process. First, it gave a written test related to mechanical aptitude. Applicants who passed that test moved to a second stage, in which candidates’ resumes were reviewed for relevant experience and skills, for which points were awarded. The applicants with the highest number of points advanced to the third stage, which consisted of an interview with a panel of four PSCo employees. The interview consisted of a set of pre-selected questions -- used for each interviewee -- which addressed skills like initiative and risk taking, adaptability, dealing with ambiguity, and team building. Each interviewer assigned a numerical rating to each candidate. After the interviews, the panel decided on consensus scores for each applicant’s competencies.

During the hiring process in 2006, Turner reached the interview stage, but was not hired. She received the second lowest rating of any interviewee, and later testified that she felt that she had “struggled” throught the whole thing. The only other female applicant received the second highest rating, but refused the offer of employment from PSCo. After Turner was unsuccessful in her 2006 attempt for the Plane Specialist position, she brought a lawsuit, alleging that PSCo’s hiring process was discriminatory. The lower court granted summary judgment for PSCo, and Turner appealed.

On review, the Tenth Circuit affirmed that decision, largely on the basis that Turner was unable to show that the company’s hiring criteria were simply a pretext for discrimination. Under the now-familiar McDonnell Douglas mechanism, Turner was required to set forth a prima facie case, including the facts that she is a member of a protected class, she suffered an adverse employment action, she was qualified for the position, and that she was treated less favorably than others outside her protected class. Once that prima facie case is established, PSCo had to articulate some legitimate, non-discriminatory reason for its decision not to hire Turner. In order to successfully substantiate her claim of discrimination, Turner was then required to show that PSCo’s legitimate, non-discriminatory reason for not hiring her was merely a pretext, and that the actual reason was discrimination.

The lower court found that Turner did, in fact, establish a prima facie case, and the Tenth Circuit agreed. Further, PSCo was found to have proffered a legitimate non-discriminatory reason for not hiring Turner: she “performed poorly in her interview.” Although Turner argued that the interview process was a sham meant to hide the company’s discriminatory hiring practices, the court disagreed, stating that although “the presence of subjective decision-making can create a strong inference of discrimination,” the use of subjective criteria is “not unlawful per se.” The court pointed out that each applicant answered the same questions during PSCo’s interviews, and that the criteria used for ranking the candidates was predetermined in a written company document. Further, the company was able to link the substance of the questions to job-related competencies. According to the court, Turner provided no evidence that the interviewers injected their own additional subjective criteria into the process, and therefore, was unable to carry her burden of showing some discriminatory animus.

The key to this decision was the standardization of the company’s interview process. The questions were pre-set, written, job-related, and asked consistently of each applicant, and the interviewers were not given the discretion to determine the scope of the interview. Because the same questions were used for all applicants, and because the evaluations were based upon pre-discussed criteria and not “whims or unguided opinions,” the company prevailed.
 

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In 2007, during a nationwide upsurge in pregnancy discrimination claims, the Equal Employment Opportunities Commission (EEOC) released a set of guidelines advising employers on issues related to caregiver bias. On April 22, 2009, the EEOC further supplemented those guidelines with specific recommendations designed, it said, to help employers to “reduce the chance of EEO violations against caregivers, and to remove barriers to equal employment opportunity.” The document can be found at www.eeoc.gov/policy/docs/caregiver-best-practices.html.

The caregiving responsibilities addressed in the EEOC’s recent guidance include not only childcare, but care to parents and older family members, as well as to relatives with disabilities. The primary directives issued include: (1) development and dissemination of a “strong EEO policy” that addresses the types of conduct that may constitute discrimination; (2) training managers to recognize legal obligations created by anti-discrimination statutes and ensuring compliance with policies that support those obligations; (3) effective response to complaints of caregiver discrimination; and (4) providing clear assurance to caregiver/employees of protection from retaliation for such complaints.

The document also addresses issues related to recruitment, hiring, and promotion of employees with caregiving responsibilities, and includes specific suggestions in those areas. For example, the EEOC suggests developing specific job-related qualification standards for each position, to reflect the duties, functions, and competencies of the position. Such standards can help to minimize the potential for gender stereotyping which, in turn, will minimize the opportunity for caregiver discrimination.

Another area addressed in the EEOC’s guidance is avoiding discriminatory treatment of caregivers through the “terms, conditions, and privileges of employment.” Specifically, the EEOC suggests monitoring compensation practices for patterns of potential discrimination, and reviewing workplace policies that limit employee flexibility. The “best practices” include a number of flexible and reduced-time options, with examples of each. While not every example will be suitable for every employer, the guidance certainly informs employers of the expectations of the EEOC with respect to caregiver issues. Such information provides a sense of how these cases will be viewed by the Commission during its investigation and attempted resolution of discrimination charges in this area.

Many of the suggestions included in the guidance are similar to or parallel actions that employers currently are reviewing or enforcing to assure compliance with other recent employment law developments, including the Ledbetter Fair Pay Act, the recent FMLA regulations, and the upcoming Paycheck Fairness Act.

While the EEOC’s technical guidelines are designated as “best practices” - meaning that they are proactive measures recommended by the Commission, and are not statutory requirements - knowledgeable employers recognize that courts turn to the EEOC for direction in interpreting both federal and state anti-discrimination laws. Therefore, it is imperative that companies begin to train managers and supervisors on the content of this most recent guidance, to assure complete awareness of all legal obligations that may have an impact on decisions about treatment of employees with caregiver responsibilities.
 

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Sharon Sybrandt was fired from her position as an Operations Assistant Manager at one of Home Depot’s Nashville stores after she allowed a co-worker to use her password-protected user ID to modify a special order transaction for Sybrandt. In addition, Sybrandt herself subsequently entered computerized “notes” on the transaction, indicating that she wanted to cancel part of the order and receive a refund. Both actions were in violation of the company’s “no-self-serve” policy. After Sybrandt was replaced by a male employee, she sued Home Depot, alleging gender discrimination under both federal and state laws. The lower court granted the company’s motion for summary judgment in April 2008, and the 6th U.S. Circuit Court of Appeal recently upheld that decision. Sybrandt v. Home Depot, USA, Inc., 6th Cir., No. 08-5598, March 26, 2009.

Sybrandt began working at Home Depot in 1991. In 2006, her employment was terminated for an alleged violation of a company policy that prohibits employees from working on their own purchases and transactions. Sybrandt testified that she was aware of the policy, and understood that its purposes were to deter theft and dishonesty, and to avoid even the appearance of impropriety. However, she argued that the decision to fire her was “unfair and extreme,” and asserted that the termination was simply a pretext for discrimination.

Under the now-familiar McDonnell Douglas shifting burden analysis, an individual has the initial burden to come forward with a prima facie case of discrimination; the employer is then obligated to show a legitimate business reason for its actions; the ultimate burden is on the employee to show that the proffered reason is a pretext for discriminatory motive. In this case, the parties agreed, for purposes of summary judgment, that Sybrandt was able to set forth a prima facie case, and that Home Depot had set forth a legitimate business reason for its action. The argument, then, was whether the proffered reason was based in fact, or whether it simply was a pretext to mask discriminatory treatment.

While Sybrandt argued that the company’s reason was overly technical and not based in fact, Home Depot was able to set forth evidence of an internal investigation, taken after it was made aware of Sybrandt’s actions. That evidence showed that the investigator – one of Home Depot’s Employment Practices Managers (EPMs) – believed that Sybrandt had breached the company’s policy, and that he had recommended discharging 18 Home Depot employees for the same reason over a previous three year period. In spite of Sybrandt’s disagreement with Home Depot regarding whether her actions technically violated the policy, it was the company’s thorough investigation that supported Home Depot’s assertion that it had an honest belief in its proffered nondiscriminatory reason for the termination.

An employee cannot establish that the reason for an adverse employment action is discriminatory simply by showing that the action may have been technically incorrect. The key inquiry in assessing whether an employer holds an honest belief that its action was appropriate is whether that employer made a “reasonably informed and considered decision” before taking the complained-of adverse action. In this case, Home Depot’s thorough, complete, and reasonable investigation (in which it interviewed Sybrandt and her co-workers, reviewed security camera footage of the incidents, and obtained written statements from various witnesses) supported its assertion that it took the action necessary to enforce its policy, and helped it to avoid legal liability in the matter. The decision to fire Sybrandt reflected a “considered” judgment, which Sybrandt was unable to contradict with any evidence other than her own testimony.

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Title VII does not include “care-giver” as a separate category for purposes of protection against discrimination. However, in a decision involving the failure to promote a woman with four young children, the 1st U.S. Circuit Court of Appeals has reminded us that one important premise of Title VII’s gender discrimination provision is that “women have the right to prove their mettle in the work arena without the burden of stereotypes regarding whether they can fulfill their [work-related] responsibilities.” Chadwick v. Wellpoint, Inc., 1st Circ. No. 08-1685, March 26, 2009.

Laurie Chadwick brought a claim of gender discrimination against her employer, WellPoint, Inc. and Anthem Health Plans of Maine (together, “WellPoint”), an insurance company, after she was denied a promotion in 2006 as Team Leader of a group of Recovery Specialists. At the time of her application for promotion, Chadwick had worked for WellPoint as a Recovery Specialist for seven years, and had received a score of 4.4 out of a maximum of 5.0 on her most recent performance review. Donna Ouelette, the individual who was promoted instead, had been a Recovery Specialist for one year, and had received an evaluation of 3.84.

In 2006, Chadwick was the mother of an 11-year-old and 6-year-old triplets. At the same time, she was taking one course each semester at a local university. There is no indication that Chadwick’s parental responsibilities had an adverse impact on her job performance; in fact, Chadwick’s husband was the primary care-taker of all four children. Shortly before the promotion interviews, Nanci Miller, Chadwick’s immediate supervisor, who also was the decision-maker with respect to the promotion, sent an e-mail to Chadwick, commenting on the fact that she had recently learned that Chadwick was the mother of triplets. (The e-mail opened with the phrase, “Oh, my!”) During the interviews, Linda Brink, Chadwick’s former supervisor, mentioned Chadwick’s parental status. Further, and most notably, when Chadwick subsequently asked why she had not received the promoted, Miller stated that, “It wasn’t anything you did or didn’t do. It was just that you’re going to school, you have the kids and you just have a lot on your plate right now.” In that same discussion, Miller stated to Chadwick that, “if [the interviewers] were in your position, they would feel overwhelmed.”

In response to Chadwick’s claim, WellPoint filed a motion for summary judgment. The lower court granted the motion on the basis that nothing in Miller’s words showed that Chadwick was not promoted because of her gender. On review of that decision, the 1st Circuit reversed, stating that a plaintiff is entitled to prove discrimination by circumstantial evidence alone, and that Chadwick was not required to show an explicit statement from WellPoint that Chadwick’s gender was the basis for the adverse decision. Instead, the court found that a jury could infer, from Miller’s statements that “you have the kids” and “you just have a lot on your plate right now,” that Chadwick wasn’t denied the promotion because of her job performance, but because Miller - and therefore WellPoint – assumed that as a woman with four young children, Chadwick might not “give her all” to the job. As the court pointed out, “the essence of employment discrimination is penalizing a worker not for something she did but for something she simply is.”

This case was decided by the First Circuit under a summary judgment standard (where all inferences must be drawn in favor of the plaintiff), and therefore is not a decision of ultimate liability. However, the opinion makes an important point. In simple terms, an employer is free to discipline, fail to promote, or fire an employee whose performance suffers due to personal obligations or interests, including childcare, without necessarily incurring liability under Title VII. However (and this is an important “however”), an employer is not free to assume that a woman - simply because she is a woman - will necessarily be a less productive worker simply because of family responsibilities.
 

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In an unpublished opinion, the U.S. Circuit Court of Appeals for the 10th Circuit reminds us that whether a case is based on allegations of discrimination or on allegations of retaliation, the individual bringing the lawsuit carries the ultimate burden of proof in the case. Sunderman v. Westar Energy, Inc., 10th Cir., No. 08-3059, Jan. 14, 2009.

To establish retaliation under Title VII, an individual’s evidence must withstand the three-part analysis established by the U.S. Supreme Court in McDonnell Douglas Corp. v. Green, 411 U.S. 792 (1973). Under that test, the plaintiff first bears the burden of establishing a prima facie case: (1) that he engaged in a protected activity; (2) that he suffered a materially adverse employment action; and (3) that a causal connection existed between the protected activity and that action. Once the individual meets that burden, the employer must offer a legitimate, non-retaliatory reason for its employment action. Should the employer satisfy this burden, the plaintiff then bears the ultimate burden of demonstrating that the employer’s reason is “unworthy of credence” so that a fact-finder could infer that the employer did not act for those reasons but instead, for some retaliatory reason.

Derek Sunderman was employed as a manager by Westar Energy, Inc., a public utility company. In March 2002, Sunderman made a complaint to Westar’s HR department regarding certain allegedly offensive sexual comments made by a supervisor, and followed up in October of that year with a written complaint to his own supervisor (Olsen). He then filed a claim with the KHRC and the EEOC, alleging that Westar retaliated against him - by reducing his compensation and suspending him in late October - for making the complaints.

During a 2002-2003 reorganization which was in process prior to Sunderman’s complaints, Westar eliminated a number of positions, including Sunderman’s, and transferred the responsibilities of those positions to the company’s Customer Support Group. Sunderman was referred to the company’s Career Placement Center, and his employment was terminated in August 2003. He then brought a lawsuit against Westar, alleging that his employment there was terminated in retaliation for filing a complaint to the Kansas Human Rights Commission (KHRC) and the EEOC in November 2002. Westar countered that Sunderman’s discharge was based upon the reorganization and was strictly a business decision. The lower court granted summary judgment in favor of Westar. That decision was upheld on appeal to the Tenth Circuit.

The dismissal of Sunderman’s claims was based primarily on the fact that he had provided insufficient evidence showing a causal connection between (1) his complaint to Olsen and/or the filing of his complaint with the KHRC/EEOC, and (2) his termination. The facts showed that Olsen was not a decision-maker in the reorganization or with respect to Sunderman’s ultimate termination. While some cases of retaliation rest upon a “cat’s paw” theory, where a biased individual who lacks decision-making power uses a formal decision-maker as a “dupe” in a deliberate scheme to trigger a discriminatory employment action, Sunderman presented no evidence that Olsen suggested either the reorganization or the subsequent discharge. While the Tenth Circuit determined that the employment actions taken against Sunderman in 2002 (reduction in compensation and a suspension) could be raised by Sunderman as background evidence for the retaliation claim, it also determined that Westar had provided sufficient evidence of its business-related decision regarding Sunderman, and that those two incidents were “insufficient . . . to raise a jury question on the causation and pretext issues that are associated with plaintiff’s [August 2003] termination.”

It is clear that in this case, the company’s documentation of the business reasons for its actions were a primary focus of the court’s analysis and review. Although Sunderman had the ultimate burden of proof in this case, the company’s ability to support its own defense with evidence and testimony was sufficient to refute Sunderman’s claims. Once again, objective and complete documentation of a company’s business decision is integral to a favorable result in a claim related to that decision.
 

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Before an individual may file a lawsuit under Title VII or the ADEA, he or she is required to file (or cross-file) a charge of discrimination with the EEOC. The charge is legally sufficient only if it describes with particularity the parties and the actions or practices of which the individual is complaining. The scope of a plaintiff’s right to file a federal lawsuit is determined by the contents of that charge; that is, the lawsuit must be based upon the claims described in the charge, or reasonably related to those described in the charge. Typically, a claim submitted to federal court will be dismissed if the EEOC charge alleges one basis of discrimination, and the formal litigation alleges another, unrelated basis.

The 4th U.S. Circuit Court of Appeals has allowed a plaintiff to allege “retaliatory discharge” in her federal lawsuit, although her employment was not terminated until after a charge for which she already had received a right-to-sue notice and which, therefore, did not specifically claim her firing as part of the complained-of retaliation. Jones v. Calvert Group Ltd., 4th Cir., No. 07-1680, 1/05/09.

Linda Jones is an African-American female who filed a complaint with the Maryland Commission on Human Relations in 2003, alleging that she had been denied a promotion on the basis of her race, sex, and age. That complaint was resolved in 2004 by written agreement, under which the company agreed to provide certain training and assistance to Jones to enable her to qualify for promotions ion the future.

Immediately after that resolution, Jones received a negative performance evaluation - her first ever. She then filed another charge of discrimination. In the second charge, Jones alleged that in retaliation for her first charge, she was denied mentoring opportunities and that her performance was unduly scrutinized, resulting in an undeserved negative evaluation. Jones received a right-to-sue letter for the second charge on August 6, 2006. Her employment was terminated on October 19, 2006.

On November 3, 2006, Jones filed a lawsuit alleging that she was discriminated against because of her race, sex, and age, and that she was terminated in retaliation for engaging in activity protected by Title VII and the ADEA. The company argued that Jones had failed to exhaust her administrative remedies, since her second charge had not set forth specific claims of discrimination, and that her retaliatory discharge was not specifically mentioned in the charge. The lower court granted summary judgment against Jones on all of her claims. On appeal, the Fourth Circuit agreed that Jones failed to specifically include her claims of discrimination in her second charge and, therefore, failed to exhaust her administrative remedies under Title VII and the ADEA. In addition, however, the Fourth Circuit remanded the retaliation claim back to the lower court for further proceedings on that claim.

The Fourth Circuit’s decision was based on the position of a number of other courts that have addressed this issue, and which have held that a plaintiff may raise the retaliation claim for the first time in federal court if that claim is “like or related to allegations contained in the [prior, timely] charge.” Jones’ second charge alleged a pattern of conduct, including denial of mentoring opportunities, and actions that resulted in her first-ever negative performance review. She specifically alleged that she was being continually “subjected to differential treatment” in retaliation for her first charge. In light of Jones’ allegation that retaliatory conduct was ongoing, the court held that her termination was “merely the predictable culmination of [the employer’s] alleged retaliatory conduct.” Therefore, Jones’ federal court claim of retaliatory discharge was “reasonably related” to the allegations set forth in her second charge, and should be allowed to go forward in the federal court action.

Employers must recognize that discrimination and retaliation are two separate legal claims and that – as in this case – an employee who is unable to support a claim of discrimination, either substantively or procedurally, may still be able to sufficiently support a claim of retaliation. Supervisors and managers must be understand the type of activity that is protected under federal and state anti-discrimination laws, and must be trained to work cooperatively with employees who have exercised their rights to engage in such activity.

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The 1st U.S. Circuit Court of Appeals has upheld summary judgment in favor of an employer who asserted that it had terminated the employment of a human resource manager because of his poor performance and a reduction-in-force, and not because of his prior testimony in a sexual harassment claim filed against the company. Dennis v. Osram Sylvania, Inc., No. 07-2670 (1st Cir. Dec. 10, 2008).

In order to set forth a case of retaliation under Title VII, an employee must show that he engaged in a statutorily protected activity, that he suffered an adverse employment action, and that the protected activity and the adverse action were causally connected. Once that prima facie case has been proven, the employer has the burden of offering a legitimate business reason for the adverse action. Once that legitimate reason has been asserted, the employee must prove that the proffered reason was simply a “pretext” for the alleged retaliation.

Richard Dennis was employed with Osram Sylvania from August 1995 until March 2004, when his employment was terminated. At the time of his discharge, Dennis held a position in Osram’s human resources department, representing the company at recruiting fairs and assisting with its internship program. On February 5, 2004, Dennis gave deposition testimony in a case in which a female employee filed a sexual harassment complaint against a co-worker at Osram. The following day, in an instance of unfortunate timing, an investigation was undertaken into a complaint against Dennis which had been received by the company on January 28. In that complaint, an unsuccessful applicant for employment at Osram (Molina) claimed that Dennis had subjected him to “inappropriate and unprofessional” conduct, including references to the applicant’s personal problems, and then sharing details of those problems with a company supervisor.

After a meeting between an Osram in-house counsel and Dennis’ supervisors, it was decided that a written warning would be placed in Dennis’ file. When Dennis was requested to sign a statement to that effect, he refused, and told his supervisor (Franz) that he viewed the Molina investigation as retaliation for his prior testimony in the sexual harassment case. Franz had no knowledge of that deposition at the time that he disciplined Dennis.

Dennis was terminated on March 24, 2004. Franz recommended the termination as part of a reduction-in-force (RIF), stating that Dennis’ performance was “severely weakened” by the Molina investigation, and that the RIF required him to choose between Dennis and another employees, who Franz considered to be a “high achieving human resources manager.” Dennis then filed a complaint under the New Hampshire state anti-discrimination law. The case ultimately was removed to federal court, where summary judgment was granted in favor of Osram. Dennis appealed that dismissal.

The First Circuit upheld the lower court’s decision, stating that Dennis had not set forth the third prong of his prima facie case, since he was unable to connect his protected deposition testimony to his subsequent termination. The court based that conclusion on the fact that the individuals responsible for Dennis’ termination “knew nothing about the [prior] deposition.” The court alternatively concluded that even if Dennis had successfully established a prima facie case of retaliation, Osram had set forth legitimate reasons (prior poor performance and the RIF) for the termination, and that Dennis was unable to show that those reasons were simply pretext for retaliation.

Although this case was decided on the specific facts and testimony in the matter, the court’s decision provides some direction in the analysis of a retaliation claim, and once again underscores the importance of full and objective documentation. The court found that much of Dennis’ argument regarding the company’s actions was based upon unsupported speculation and inference. Dennis offered no evidence that the individuals who were involved in the decision to terminate his employment consulted with anyone who attended the deposition which Dennis viewed as his “protected activity.” Further, because the company was able to support Dennis’ poor performance with documentation, it was able to support its decision in the RIF, and Dennis was unable to carry his burden to prove that the rationale for his termination was pretextual.

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Under Title VII, an employer can be held liable for a hostile work environment created by a supervisor. That situation differs from a hostile work environment created by a co-worker, where the company is liable only if the complainant can show that the company was negligent in discovering or remedying the situation. Recently, the 7th U.S. Circuit Court of Appeals reviewed the definition of “supervisor” under Title VII, and determined that a supervisor is not a person who simply possesses authority to oversee an individual’s job performance. In order to be classified as a “supervisor” for purposes of liability under Title VII, that person must have the power to “directly affect the terms and conditions of the plaintiff’s employment,” including the power to hire, fire, promote, or demote. Andonissamy v. Hewlett-Packard Company, Nos. 07-2387 and 07-2390 (7th Circ. November 7, 2008).

Sanjay Andonissamy, a French citizen of Indian ethnicity, worked as a systems engineer for Hewlett-Packard. In that capacity, and based upon H-P’s sponsorship of his H-1B visa, he was assigned to the Qwest Cyber Center in Chicago from April 2001 through June 2003. Andonissamy alleged that during his tenure at Qwest, his supervisor (Smith) made racist comments, including remarks that U.S. citizens were unable to find jobs because “people like Andonissamy” had taken them. Andonissamy complained about Smith’s remarks and treatment. H-P and Qwest asserted that while Andonissamy’s technical skills were strong, his relationships with co-workers and customers were not strong, and that the company had received complaints that Andonissamy treated people rudely. After a complaint from a customer in 2002, Smith put Andonissamy on a performance improvement plan. Subsequently, Andonissamy’s performance deteriorated, with missed deadlines increasing, and additional complaints about Andonissamy from both Qwest and customers.

In March 2003, H-P’s human resource department undertook an investigation, and determined that a performance warning should be issued to Andonissamy. After the issuance of that warning on May 5, Andonissamy continued to miss deadlines and refused to train a back-up person to assist him. In June 2003, Qwest refused to allow Andonissamy’s return to the Cyber Center, and Andonissamy’s employment with HP was terminated. In 2004, Andonissamy filed a federal court complaint against both H-P and Qwest, which included national origin discrimination and violation of the FMLA, based upon denial of a requested leave for depression.

The lower court dismissed all of Andonissamy’s claims on summary judgment, and that decision was upheld on appeal. After analyzing each of Andonissamy’s claims, the Seventh Circuit found that none were sufficiently supported. The most interesting part of the analysis is the court’s characterization of the national origin/hostile environment claim under Title VII.

First the court set forth the elements necessary to survive summary judgment on a claim of hostile environment, stating that a plaintiff must establish that: (1) he was subjected to unwanted harassment; (2) the harassment was based upon national origin; (3) the harassment was severe and pervasive enough to alter the conditions of his employment; and (4) there is a basis for employer liability. The court never reached the question of whether Andonissamy’s workplace was a hostile environment. Instead, it held that Andonissamy had not established a basis for employer liability, because he was unable to establish that Smith possessed sufficient authority to be classified as a “supervisor” under Title VII. Smith did not hire or fire Andonissamy, and while Smith was able to recommended disciplinary action, H-P’s human resource department had to conduct an investigation and issue its own recommendation prior to discipline being imposed.

 In this case, the court specifically stated that “directing work activities and recommending disciplinary action are not in and of themselves sufficient to make someone a supervisor under Title VII.” However, employers should not take this as an open invitation to overlook situations in which nominal managers act unprofessionally toward subordinates. The result of this case turned on the specific circumstances of the relationship between Smith and Andonissamy, and the fact that Smith did not have direct authority to hire, fire, or discipline Andonissamy. In addition, H-P had carefully documented Andonissamy’s original complaints about Smith, and was able to show that those complaints did not include allegation of national origin discrimination. Therefore, the company was not on notice of the nature of Andonissamy’s claims against Smith and could not be deemed to have been liable for discrimination.

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