Tag Archives: equal employment opportunity

Hear No Evil: U.S. Supreme Court Protects Internal Oral Wage Complaints from Retaliation

Now more than ever, employers find themselves facing retaliation suits from their employees. 2010 marked the first year in the history of the Equal Employment Opportunity Commission (“EEOC”) that race discrimination claims were not the most prevalent category of alleged employment law violations. Instead, retaliation charges topped the EEOC’s list.

Federal law offers broad protection to employees against retaliation. Several federal statutes contain anti-retaliation provisions, including the Fair Labor Standards Act (“FLSA”), the Family and Medical Leave Act, the Labor Management Relations Act, the Age Discrimination in Employment Act, and Title VII of the Civil Rights Act of 1964. Furthermore, the U.S. Supreme Court has recently extended Title VII protection to “third-party” retaliation claims, i.e., those in which an employer allegedly retaliated against one employee because another engaged in protected activity. And in a recent decision, the U.S. Supreme Court continued to expand the borders of what constitutes protected conduct under the Fair Labor Standards Act’s anti-retaliation provision.

In Kasten v. Saint-Gobain Performance Plastics Corp., No. 09-834, the U.S. Supreme Court considered whether the FLSA’s anti-retaliation provision protected employees who made internal oral complaints to their employers regarding FLSA violations, or only those who filed written complaints. After a lengthy analysis of the term “filed”, the Court concluded that the FLSA protected employees who made internal oral complaints from retaliation by their employers.

The Court’s decisions bode ill for employers for a several reasons. First, by protecting employees who make internal oral complaints, it burdens employers with determining whether an employee comment is a complaint or just an employee blowing off steam. Second, the Court ruled that the FLSA protected internal oral complaints, not just complaints to government agencies. Third, and perhaps most importantly, it makes many more employment decisions “gray” – meaning that more cases will be litigable (and litigated) than before. This will be true whether employers are actually guilty of retaliation, or not. It is now even easier for employees to allege and prove retaliation.

As bad as this new precedent is for employers, it should not change ultimate decision making by employers in most cases. For instance, even before Kasten, few employers would have consciously decided to retaliate against an employee because the employee made internal oral complaints. Some employers might have done this, but in many cases they would face charges, guilty or not, just based on timing. For example, Joe gets fired three weeks after he files an internal oral complaint about perceived overtime violations. Regardless of whether the two events are related, or not, a charge has always been possible. Now a charge is much more likely.

What will change for employers, now, is their processes before ultimate decisions are made. There are some common sense steps employers can take to protect themselves from retaliation claims:

  • Be aware of the timing of ultimate employment decisions. Some courts say that timing alone will not prove an employee’s case, but bad timing will influence a court’s decision.
  • Document an employee’s performance reviews and disciplinary history. An employer with a legitimate, non-discriminatory reason for a decision has a powerful defense to a retaliation claim. Employers should make sure they have evidence of their reasons. This is a best management practice, anyway. These new cases just make it more important.
  • Be consistent. If an employer only disciplines an employee or criticizes his performance after he files an EEOC charge, or internally reports an FLSA violation, a retaliation claim is much more likely, whether there is a good reason for the change, or not.
  • Evaluate the decision before finalizing it. Employers should ask themselves whether they would make an employment decision even if the employee had not engaged in protected activity.

Train. Everyone knows that discrimination is illegal. Prior to making discipline decisions, almost everyone knows to vet whether the discipline subject engaged in any protected activity. If they engaged in protected activity, that doesn’t protect them from adverse action, but it should make employers double-check before pulling the trigger on any adverse action. Employers now need to be even more vigilant about making sure everyone is as alert to retaliation red-flags as they are to discrimination red-flags. After Kasten, internal oral complaints about wage and hour issues must now be considered red-flags.

New ADA Regulations Become Effective May 24, 2011

The long-awaited final regulations implementing the ADA Amendments Act (ADAAA) were published in the Federal Register on Friday, March 25, 2011. The regulations become effective sixty days from the date, on May 24, 2011.

Background

The ADAAA was passed by Congress in 2008, became effective on January 1, 2009, and amended the Americans With Disabilities Act (ADA).  The purpose of the ADAAA was to make it easier for an individual to establish that he or she has a disability within the meaning of the ADA by requiring a broad and more lenient interpretation of disability under the law.  The Equal Employment Opportunity Commission (EEOC) issued proposed regulations under the ADAAA on September 23, 2009.

After reviewing more than 600 public comments to the proposed rules, the EEOC published the final regulations, along with an Appendix containing the EEOC’s interpretive guidance.  According to the EEOC, the Appendix “will continue to represent the Commission’s interpretation of the issues discussed in the regulations, and the Commission will be guided by it when resolving charges of discrimination under the ADA.”

Employer groups have generally found the final regulations to include improvements over the regulations as initially proposed.

Highlights of the final regulations

• References to “a qualified individual with a disability” have been deleted, consistent with the ADAAA.

• Under the “regarded as” prong of the definition of disability, an individual is no longer required to show that he/she is regarded by the employer as being substantially limited in a major life activity.  Rather, the individual must merely show that that he/she has been subjected to an action prohibited by the ADA because of an actual or perceived impairment that is not both “transitory and minor.”

• The EEOC has made clear that where an individual is not seeking a reasonable accommodation, but only complaining about discrimination, then the case should normally proceed under the “regarded as” prong and it is generally unnecessary to invoke prongs one or two, i.e., the “actual disability” or “record of” disability prongs.  Under the ADAAA, an individual who proceeds under the “regarded as” prong is not entitled to a reasonable accommodation as a remedy.

• The EEOC has deleted the long-standing definition of major life activities as those basic activities that most people in the general population “can perform with little or no difficulty,” as being an irrelevant consideration.  As a result, the final regulation simply provides examples of activities that qualify as “major life activities” because of their relative importance.

• The final regulations do not define “substantially limits.”  Rather, the final regulations set out nine “rules of construction” to be used in determining whether an impairment is substantially limiting.

• The EEOC has made clear in the Appendix that the fact that an individual elects not to utilize mitigating measures is irrelevant to the determination of whether an impairment is substantially limiting.  However, the EEOC has clarified that the use or non-use of mitigating measures may be relevant in determining whether the individual is qualified or poses a direct threat to safety.

• In the proposed regulations, the EEOC included a list of impairments that would “consistently meet the definition of disability.”  In the final regulations, the EEOC has clarified that the analysis of whether any of these impairments substantially limits a major life activity still requires an individualized assessment.  However, the individualized assessment will, in virtually all cases, result in a finding that the impairment substantially limits a major life activity.

• The final regulations deleted the proposed regulations (a) listing impairments that may be substantially limiting for some individuals but not others; and (b) providing examples of impairments that “are usually not disabilities.”

• The final regulations reinstated use of the terms “condition, manner, or duration” as concepts that may be relevant to the determination of whether an impairment is substantially limiting.

• The final regulations move the discussion of how to analyze the major life activity of working to the Appendix and have retained the original formulation of “class or broad range of jobs” in analyzing whether an individual is substantially limited in this major life activity.  The proposed regulations sought to replace the concepts of “class” or “broad range” of jobs with the concept of “type of work.”  The EEOC concluded that this change would create confusion.

• The final regulations make clear that even if ADA coverage is established under the “regarded as” prong of disability, the individual must still establish the other elements of a claim of discrimination, e.g., the individual is qualified, he/she has been discriminated against because of the impairment, etc., and the employer may raise any available defenses, e.g., the impairment was transitory and minor.  However, the final regulations also point out that the concepts of “major life activities” and “substantially limits” are not relevant in evaluating coverage under the “regarded as” prong.

Recent Supreme Court Case Allows Third Party Retaliation Claims

On January 24, 2011, the Supreme Court of the United States issued a unanimous (8-0, Justice Kagan recused herself) decision in Thompson v. North American Stainless, LP, 131 S. Ct. 863 (2011) that expanded the provisions of Title VII retaliation. In Thompson, the Supreme Court ruled that Title VII prohibits third party retaliation. Specifically, the Court found that the employer violated Title VII by terminating an employee after his fiancée had filed a charge with the Equal Employment Opportunity Commission (“EEOC”). After Thompson, employers now must contend with a different type of retaliation, one brought by an employee who claims he or she was retaliated against because of a “relationship” he or she had with a co-worker who engaged in protected activity, but not because he or she engaged in protected activity.

In Thompson, both petitioner Eric Thompson and his fiancée, Miriam Regalado, worked for the respondent North American Stainless (“NAS”). In February of 2003, Regalado filed a charge of sex discrimination with the EEOC against NAS. Three weeks later, NAS terminated Thompson’s employment. Thompson then filed an EEOC charge and after conciliation efforts were unsuccessful, he filed suit against NAS in the United States District Court for the Eastern District of Kentucky for Title VII retaliation.

Thompson alleged that NAS fired him in order to retaliate against his fiancée for filing her EEOC charge. The District Court granted summary judgment in favor of NAS, concluding that Title VII does not permit third party retaliation claims. On appeal, the United States Court of Appeals for the Sixth Circuit reversed the District Court. However, on rehearing en banc, the Sixth Circuit then affirmed the District Court, finding that Thompson did not engage in any statutorily protected activity under Title VII. The Supreme Court then granted certiorari to determine whether Thompson’s termination constituted unlawful retaliation and whether Title VII granted Thompson a cause of action.

Regarding the first issue, the Court found that Title VII prohibited NAS from terminating Thompson. Relying on the Court’s previous decision in Burlington N. & S. F. R. Co. v. White, 548 U.S. 53 (2006), the Court determined that Title VII’s anti-retaliation provision must be construed broadly. The Court noted that Title VII’s anti-retaliation provisions are designed to prohibit employers from taking actions that “might have dissuaded a reasonable worker from making or supporting a charge of discrimination.” Accordingly, the Court found that a reasonable worker might be dissuaded from engaging in a protected activity if her fiancé was going to be fired as a result.

While the Court declined to identify a fixed class of relationships that are protected from third party retaliation, the Court indicated that “firing a close family member will almost always meet the … standard, and inflicting a milder reprisal upon a mere acquaintance will almost never do so, but beyond that we are reluctant to generalize.” The Court stated that given the variety of workplace contexts in which retaliation may occur, the anti-retaliation provision cannot be reduced to a clear set of rules.

The Court next considered the issue of whether Thompson could sue NAS under Title VII even though, unlike his fiancée, he had not engaged in protected activity. The Court rejected NAS’s argument that Thompson was not, in the words of Title VII, a “person aggrieved” under that law. The Court concluded that Thompson could bring a cause of action because he was within the “zone of interests protected by Title VII” as he was an employee of NAS. The Court found, “Thompson was an employee of NAS, and the purpose of Title VII is to protect employees from their employers’ unlawful actions . . . Hurting him was the unlawful act by which the employer punished her. In those circumstances, we think Thompson well within the zone of interests sought to be protected by Title VII.”

There will likely be an increase in retaliation claims following this decision. The difficulty for employers is that the Court specifically declined to establish a rule defining this new third party retaliation cause of action, and instead indicated that these claims will be analyzed on a case-by-case basis. This case brings light to another avenue of retaliation claims with which employers need to be aware.

Federal Court Refuses To Toss Out EEOC Claim That Chrysler Retaliated Against Employees

Hostile Warnings of Discipline and Termination After Complaint of Sex Discrimination Are Enough for Case to Go Forward, Judge Says

MILWAUKEE – Automobile giant Chrysler Group, LLC’s effort to have an U.S. Equal Employment Opportunity Commission (EEOC) claim of unlawful retaliation thrown out of court has failed, the agency announced today. The EEOC has received a February 17, 2011 Decision and Order from District Judge William F. Callahan, Jr., denying Chrysler’s motion for summary judgment. The judge held that the EEOC’s claims of retaliation on behalf of two women employed in the company’s national parts distribution center in Milwaukee should go forward. (EEOC v. Chrysler Group, LLC, E.D.Wis. No. 08-C-1067, Decision & Order, 2/17/2011, D.J. Callahan.)

The claims were brought by the EEOC under Title VII of the Civil Rights Act of 1964 in a lawsuit filed in December 2009. According to the EEOC, one of the women was taken off what the court described as a “coveted position” driving a power sweeper and assigned to more physically demanding work “picking” parts to satisfy a “hot order” in the “back order area” of the warehouse. The EEOC said that when the woman and a coworker complained that a male employee with less seniority should have been assigned to that job, they were accused of “disrupting the workforce” subjected to verbal harassment and threatened with discipline up to and including termination.

Chrysler urged the court to summarily reject EEOC’s claims because the women were neither discharged nor suffered any other tangible loss such as a loss of pay, benefits, or position. According to Chrysler, “the alleged verbal harassment and intimidation is simply not the kind of actionable harm which Title VII contemplates.”

The court rejected that line of reasoning. “An adverse employment action [necessary to sustain a claim for retaliation] need not be tangible,” Judge Callahan wrote. The court then reviewed the circumstances surrounding the statements to the women, finding that “the manner in which [the manager] delivered his message to each woman matters. If he were screaming and pounding his fists on the table while threatening termination, as [the women] testified, this scenario paints a much more hostile and intimidating atmosphere than if [the manager] delivered his message in a normal tone of voice, as he contends he did.”

Because of this controversy, the court concluded, the trial should go forward to determine whether Chrysler’s behavior “would have dissuaded a reasonable worker from making a charge of discrimination.”

The EEOC’s regional attorney in Chicago, John Hendrickson, said, “This is an important decision. It is a firm reminder that the concept of retaliation under the federal employment discrimination laws is a common-sense one. The Supreme Court has said that if an employer responds to a discrimination complaint in a way which would dissuade a reasonable worker from filing a charge, that’s retaliation. The EEOC will move swiftly to stem such actions.”

In addition to Hendrickson, the case is being litigated by Supervisory Trial Attorney Gregory Gochanour and Trial Attorneys Bradley Fiorito and Grayson Walker, all of EEOC’s Chicago District Office. The EEOC’s Chicago District Office is responsible for processing charges of discrimination, administrative enforcement, and the conduct of agency litigation in Illinois, Wisconsin, Minnesota, Iowa, and North and South Dakota, with Area Offices in Milwaukee and Minneapolis.

Third Party Retaliation Claims under Title VII, the Discovery Rule under the NJLAD, and the Self-Critical Analysis Privilege under the FLSA

Employers conducting business in the New Jersey / New York markets should take note of several recent employment-related decisions. In Thompson v. North American Stainless, LP, 2011 U.S. LEXIS 913 (Jan. 24, 2011), the United States Supreme Court ruled that an employee who claimed he was fired because his fiancée filed a sex discrimination charge against their mutual employer could pursue a retaliation claim under Title VII of the Civil Rights of 1964. In Henry v. New Jersey Department of Human Services, 2010 N.J. LEXIS 1260 (Dec. 10, 2010), the New Jersey Supreme Court held that a terminated employee should have the opportunity to avail herself of the “discovery rule” and demonstrate that she acted reasonably in pursuing her discrimination claim in order to avoid a dismissal on statute of limitations grounds. In Craig v. Rite Aid Corporation, 2010 U.S. Dist. LEXIS 137773 (M.D. Pa. Dec. 29, 2010), discussed in the HR Tip of the Month, the Middle District of Pennsylvania declined to recognize the “self-critical analysis” privilege to protect a company’s voluntary internal assessment of its compliance with the Fair Labor Standards Act (FLSA), labor laws and existing bargaining agreements.

Thompson v. North American Stainless, LP

Eric Thompson and his fiancée were both employed by North American Stainless (NAS). Three weeks after being notified by the Equal Employment Opportunity Commission (EEOC) that Thompson’s fiancée had filed a charge of discrimination, NAS fired him. Thompson then filed a charge with the EEOC and later filed suit in federal court claiming that NAS fired him in order to retaliate against his fiancée.

The district court granted summary judgment to NAS, holding that Title VII did not permit third party retaliation claims. An en banc panel of the Sixth Circuit affirmed, concluding that because Thompson did not engage in any statutorily protected conduct, he was not included in the class of persons for whom Congress created a retaliation cause of action. The United States Supreme Court granted certiorari, and in an 8-0 decision, reversed the appellate panel.

The Court considered two questions: first, whether NAS’s firing of Thompson constituted unlawful retaliation; and second, did Title VII grant him a cause of action. The Court had little difficulty answering the first question in the affirmative, finding that if the facts alleged by Thompson were true, then his termination violated Title VII. Relying on past precedent, Justice Scalia, writing for the Court, observed that Title VII’s anti-retaliation provision, unlike the substantive provision, was not limited to discriminatory acts that affected the terms and conditions of employment. Rather, it prohibited any employer action that might dissuade a reasonable worker from making or supporting a charge of discrimination. The Court thought it obvious that a reasonable worker might be dissuaded from engaging in protected activity if she knew that her fiancé would be fired.

Regarding the second question, the Court addressed whether “aggrieved” under Title VII should be construed in a matter consistent with Article III standing, which requires only injury in fact caused by the defendant and remediable by the court. Justice Scalia concluded that “aggrieved” must be construed more narrowly. He also rejected the position advanced by NAS – that a “person aggrieved” refers only to the employee who engaged in protected activity. The Court adopted the “zone of interests” test, holding that “aggrieved” under Title VII enabled a suit by any plaintiff with an interest “‘arguably [sought] to be protected by the statutes.’” Applying that test, the Court concluded that Thompson fell within the zone of interests protected by Title VII, as (i) he was an employee of NAS, (ii) the purpose of Title VII was to protect employees from unlawful actions, and (iii) he was not an accidental victim of retaliation (but rather injuring him was NAS’s way of punishing his fiancée).

Henry v. New Jersey Department of Human Services

In April 2004, Lula Henry (Henry), who held a Master’s degree, was hired by Trenton State Psychiatric Hospital at an entry-level nursing position. In late Spring/early Summer 2004, Henry developed initial concerns that racial discrimination explained why she was hired at an entry level position, though her concerns were uncorroborated by any firm evidence. In late Summer 2004, Henry questioned her classification and requested reclassification; in response she remained assigned to her entry-level position. In November 2004, Henry resigned from Trenton State in order to take a position with another entity.

In the Spring of 2006, Henry was informed by a union representative that a Nigerian nurse had contested the placement of a less qualified Caucasian nurse and that there were widespread claims of racism at Trenton State. Henry also learned that a Caucasian nurse with similar credentials to hers was immediately hired into a higher job classification, contrary to what she was told about her placement. Henry claimed that prior to learning this information she had no factual basis to substantiate her earlier suspicions of race-based discrimination.

On July 24, 2007, Henry filed a complaint alleging racial discrimination in defendants’ hiring practice and retaliation in violation of the New Jersey Law Against Discrimination (NJLAD). Defendants moved for summary judgment based on the two-year statute of limitations applicable to NJLAD claims. The trial judge granted the motion, determining that Henry’s action accrued in 2004 and was not tolled by the discovery rule. The Appellate Division affirmed, and the Supreme Court granted certification. At issue was the impact of the “discovery rule” on NJLAD claims. That rule “delays the accrual of the action until the plaintiff ‘discovers, or by exercise of reasonable diligence and intelligence should have discovered, facts which form the basis of a cause of action.’”

Henry argued that her NJLAD claims did not accrue until 2006 because that is when she had some measure of corroboration of her concerns. Defendants argued that the discovery rule should not apply to NJLAD cases, but that even if it did, the rule would not be appropriate under the facts of this particular case.

The Court explained that the discovery rule is a well-established equitable doctrine that is applied when the statute of limitations would cause unnecessary harm without advancing its purpose. However, the Court did not find that there was an equitable basis on which to extend the statute of limitations on Henry’s retaliation claim, because that claim must have accrued at or before the date of her resignation in November 2004. As a result, the Court affirmed the Appellate Division’s dismissal of the retaliation claim.

The Court reached a different result on Henry’s discrimination claim. Noting its approval of the use of the discovery rule in LAD cases “when and where appropriate,” the Court held that this case might present such a circumstance. Henry had initial concerns in 2004 about her hiring and classification, but the reason she was given in response had nothing to do with racial discrimination. That, according to the Court, may have led her not to pursue the issue, thereby requiring the tolling of her cause of action. The Court held Henry was entitled to assert that she did not have reasonable suspicion of racial discrimination, even by the exercise of reasonable diligence, until 2006 when, among other things, she learned that less qualified Caucasian nurses were hired into advanced positions and she was told by her union representative about other claims of racial discrimination. Under these circumstances, the Court decided that Henry should get a hearing at which she could show that she acted reasonably in pursuing her claim of discrimination.

U.S. Supreme Court Expands Retaliation Claims Under Title VII

Claims now allowed by employees who have not engaged in any protected activity.

On January 24, 2011, the U.S. Supreme Court issued its decision in Thompson v. North American Stainless, LP, further expanding the scope of retaliation claims under Title VII of the Civil Rights Act of 1964. In Thompson, a female employee of North American Stainless (NAS) filed a sex discrimination charge with the Equal Employment Opportunity Commission (EEOC). The employee’s fiancé, Thompson, who also worked for NAS, was subsequently terminated. Thompson claimed that his termination violated Title VII because he was terminated in retaliation for his fiancée having filed a charge of discrimination.

The Supreme Court held:

  • Under the facts as alleged, Thompson’s termination constituted unlawful retaliation in violation of Title VII because a reasonable worker might well have been dissuaded from engaging in protected activity, such as filing a charge of discrimination with the EEOC, if she knew her fiancée would be fired.
  • It is impossible to provide specific guidelines for employers as to what types of relationships in the workplace are protected in connection with claims of third party reprisals; however, firing a close relative of an employee who has engaged in protected activity will almost always rise to the level of unlawful retaliation, but inflicting a mild reprisal against a mere acquaintance will almost never do so.
  • Retaliation claims by third parties are limited to claims by persons who fall “within the zone of interests sought to be protected by Title VII.”  The purpose of Title VII is to protect employees from their employers’ unlawful actions.  Thompson was entitled to bring a retaliation claim because he was within Title VII’s zone of interests – he was an employee of NAS, and hurting him was the unlawful act by which NAS punished his fiancée for filing her charge of discrimination.

What does this mean for employers?

  • The Thompson decision means that virtually every employment decision an employer makes that adversely affects an employee has the potential to be a retaliation claim.
  • Employers must scrutinize every adverse employment decision (no matter how mild) to determine whether the employee subject to the decision has any relationship – relative, girlfriend/boyfriend, close friend, friend, acquaintance, etc. – with another employee who has engaged in conduct protected by Title VII, such as filing a charge of discrimination or opposing some alleged discriminatory act by the employer, to determine whether there is any potential for a retaliation claim.
  • Employers are encouraged to review their policies to determine whether it is appropriate to adopt a stringent nepotism policy, i.e., refusing to employ members of the same family, or a strict non-fraternization policy, i.e., prohibiting employees from dating or otherwise engaging in a romantic relationship, to minimize the potential for third-party retaliation claims.