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

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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