Source: https://www.employmentlawblog.info/2008/01/january-2008.shtml
Timestamp: 2019-04-26 10:17:21+00:00

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By Paul Mollica of Outten & Golden LLP posted in Daily Developments in EEO Law on Friday, January 18, 2008.
Here's a bit arcana for lawyers who represent federal employees to chew over, courtesy of the First Circuit: Franceschi v. US Dept of Veterans Affairs, No. 06-2677 (1st Cir. Jan. 30, 2008).
Employee files a charge against a federal agency, complaining inter alia of being given lower performance ratings for gender reasons. The EEOC writes back informing the employee that while it has ceased investigating one aspect of the charge, it would continue to pursue the allegedly discriminatory performance ratings. As the EEOC begins to investigate that claim, the employee allegedly suffers a retaliatory demotion. Without waiting for resolution of the charge, the employee sues the agency in federal court, alleging Title VII discrimination and retaliation. No separate charge is filed on the retaliation. The court holds that the employee did not exhaust administrative remedies on the discrimination claim, as federal employees are required to do under 29 C.F.R. §§ 1614.107(b), 1614.407(a), 1614.110(b). But does the retaliation claim survive?
"A claim of retaliation for filing an administrative charge with the EEOC is one of the narrow exceptions to the normal rule of exhaustion of administrative remedies. Such a claim may ordinarily be bootstrapped onto the other Title VII claim or claims arising out of the administrative charge and considered by the district court, even though it has not been put through the administrative process."
Where the original charge was not exhausted, though, the panel holds that any alleged retaliation stemming from that charge may not be deemed exhausted: "Yet where, as here, administrative remedies have not been exhausted with respect to any of the other Title VII claims in the civil action, there is nothing properly before the court to which the retaliation claim may be bootstrapped. Although we have never expressly addressed this specific circumstance, we think that, as a logical corollary of the [above] rule. . ., the exception to the exhaustion requirement cannot apply, and the retaliation claim must be dismissed along with the others for failure to exhaust."
Where to lead off, when you have two fun cases to report. . .
Let's return (as yesterday) to another FLSA case, in the Fourth Circuit, with the extra bonus that it was a class arbitration that benefitted the employees (restaurant managers): Long John Silver's v. Cole, No. 06-1259 (4th Cir. Jan. 29, 2008).
Because the employer elected -- under its mandatory arbitration policy -- to be governed by AAA rules, it set up a conflict between the FLSA opt-in procedure for collective actions and the AAA's opt-out provision for class arbitrations. The latter provides (AAA Class Rule 7) that a final award on the merits of a class arbitration must define the class "with specificity," including "those who have elected to opt out of the class." The arbitrator evaluated the policy and governing law, and held that "because 'there is no evidence of any congressional intent' to make the right to the 'opt-in' requirement of the § 16(b) provision nonwaivable, the FLSA did not preclude enforcement of the parties' agreement to arbitrate pursuant to the AAA Class Rules. Class Award 7. Accordingly, the arbitrator applied the 'opt-out' provisions of AAA Class Rule 7." The federal district court subsequently confirmed the award.
The employer (joined by the Department of Labor as amicus) appealed that order, but the Fourth Circuit affirmed. The employer made two arguments in support of reversal of the award: that use of the opt-out procedure (alien to federal FLSA litigation) was in manifest disregard of the law, or alternatively that it violated the policy.
"Because there is a debatable contention that the FLSA § 16(b) provision did not explicitly overrule the 'opt-out' feature of the arbitration agreement, the arbitrator did not ignore the FLSA or any other applicable legal principles when he certified an "opt-out" class in the Class Award, and LJS has thus not sustained its heavy burden to demonstrate otherwise."
The panel also rejected the argument that the arbitrator exceeded the scope of authority under the arbitration agreement. Because construction of the agreement was within the arbitrator's purview, and the arbitrator's choice of AAA Rule 7 over FLSA § 16(b) was a reasonable one supported by the contract, the limited judicial review allowed by the FAA did not support reversal. So the case is now remanded for notice to the class and arbitration of the FLSA claims.
"It overemphasizes the role of professional judgment, contrasting it to control over the manner and means of one's work in the common law agency test and ignores the contested facts in the record. In effect, the court's reasoning would carve out all physicians, as a category, from the protections of the antidiscrimination statutes. While a physician, like any professional, must be given latitude in which to choose a course of action, especially considering the exigencies of medical practice, the mere existence vel non of that latitude is not dispositive of the manner-and-means test."
The panel also found disputed issues of material fact on this issue: "Taking Salamon's allegations as true, OLV exercised substantial control not only over the treatment outcomes of her practice, but over the details and methods of her work. Members of the OLV administration were designated as her supervisors, with the job of 'maintain[ing] continuing surveillance of [her] professional performance.' App. at 442. Specifically, Salamon argues that OLV's application of its quality assurance standards constituted unwarranted and medically unsound interference with her professional practice." The court observed that some courts (including the Sixth and Seventh Circuits) have found that peer review programs, such as operated here, do not "control" a physician's work in the agency-principal sense. But the panel held that the issue was fact-specific and worthy of trial.
That panel did affirm summary judgment on an auxiliary claim against the hospital, based on its "interference] with her potential employment relationships by ceasing to refer patients to her." The court here rejected application of an "interference" theory of employment that originated in Sibley Memorial Hospital v. Wilson, 488 F.2d 1338 (D.C. Cir. 1973), holding that the physician-patient relationship simply wasn't "employment."
Today, the Eleventh Circuit (in an FLSA case, Rodriguez v. Farm Stores Grocery, Inc., No. 06-13186 (11th Cir. Jan. 28, 2008)) introduces a quaintly-named appellate review standard to federal law: the "tipsy coachman" doctrine, applied (in Florida state courts) to protect fully-tried cases from reversal. The panel also addresses the serious issue of how to handle an award of damages under an erroneous instruction (not object to by the employer), when the jury exceeds what the statute would otherwise allow.
The Eleventh Circuit affirmed a jury verdict that the grocery chain misclassified its store managers as exempt, finding a sufficiency of evidence that their primary duty was not management. Combined with expert analysis of the twenty-nine plaintiffs' jobs, the jury heard anecdotal evidence about the managers' actual work-week: "One store manager testified that in a typical week his time was allocated as follows: '[A]n average 30 percent as regards cleaning, 50 percent customer attention or service, 10 percent in merchandise receiving, another 10 percent approximately in stacking up the racks, but the main point was customer sales.' From his testimony a jury reasonably could conclude that at least some of the store managers spent no time performing managerial duties during most weeks. While other managers conceded that they spent some time each week performing managerial tasks, all of them insisted it was not the majority of their work, and more than one testified to spending only about ten percent of their time on management-related duties."
The employee's 'regular rate' during a particular week is the basis for calculating any overtime pay due to the employee for that week. The 'regular rate' for a week is determined by dividing all of the hours worked into the total wages paid for those hours. The overtime rate, then, would be one-half of that rate and would be owing for each hour in excess of 40 hours worked during the work week.
The second sentence is inconsistent with a controlling regulation of the Department of Labor, 29 C.F.R. § 778.113(a), which provides that "[i]f the employee is employed solely on a weekly salary basis, his regular hourly rate of pay, on which time and a half must be paid, is computed by dividing the salary by the number of hours which the salary is intended to compensate." The instruction given at trial enabled the jury to award back pay several orders of magnitude greater than the FLSA authorizes, and far more than even plaintiffs' counsel asked for in closing argument.
The panel observes that, had the correct instruction been given, it would ordinarily suffice to remand the case with directions to enter a remittitur to resize the award to the maximum allowed by law. But the erroneous instruction caused the jury to avoid deciding an important factual question -- whether the managers' weekly salary was intended to compensate the store managers for all of the hours they worked -- on which the record evidence was in dispute.
Refusing to either order a remittitur or affirm the judgment, the panel remands the case for retrial on damages only.
"On remand, when it conducts a new trial on the issue of damages, the court should instruct the jury according to the regular rate of pay standard contained in the DOL regulation. Although we leave the final decision on this detail to the discretion of the experienced district court judge, he might wish to propound specific interrogatories to the jury that include these questions as to each store manager: the weekly salary, the number of hours that salary was intended to compensate, and the number of hours actually worked. If the district court decides to use special interrogatories, it would be free to phrase the questions and include any addition al ones it believes relevant to deciding the amount of damages."
In an unusual case where the precise allocation of burden of proof proves decisive, the panel also affirms the court's finding of willfulness to support liquidated (i.e., double) damages, despite the jury's failure to find "willfulness" for purposes of applying a three (rather than two) year limitations period. The panel reconciles the two outcomes by holding that where the evidence is in pure, 50-50 equipoise, it was possible for the jury to find that the employee did not meet its burden on the limitations argument, while the employer could lose on its affirmative defense: "The reconciliation point is the burden of proof, and more specifically, the differences in its placement. For the willfulness issue on which the statute of limitations turns, the burden is on the employee; for the good faith issue on which liquidated damages turns, the burden is on the employer. Because the burden of proof is placed differently, a finding that willfulness was not present may co-exist peacefully with a finding that good faith was not present. The result varies with the burden of proof, provided that a factfinder could conclude that the evidence on the issue is evenly balanced."
Really superb plaintiffs' lawyering going on in the Fourth Circuit! That court surprised me yesterday by publishing two opinions affirming judgments for employees under the ADA.
The first, Wilson v. Phoenix Specialty Mfg., No. 06-1818 (4th Cir. Jan. 23, 2008), reviewed (for clear error) a judge's bench-trial findings that an employee with Parkinson's disease was terminated -- as a shipping supervisor for a family-owned business -- because the employer regarded him as disabled. The employee in May 2001 suffered a panic attack and loss of motor control in his right hand. He was medically released to return to work, but found that the atmosphere at work had chilled. The company president and vice president stopped making friendly visits to the employee's office, and the president required the employee after every visit to the doctor to report about his medical condition. The employer declined to accommodate him with a larger computer monitor, to assist him in writing tasks or train him on the new computer system. Finally in August 2002, the employee was terminated in a putative "reduction in force" (which apparently only involved him and one other employee), while a recent hire was promoted to perform his duties. At trial, the court made findings that the employee was regarded as disabled (but not, in fact, disabled) under the ADA and that the employer's various justifications for its termination decision were pretextual. He judge awarded him $177,783 in back pay, $10,000 compensatory damages and $10,000 punitive damages.
The panel majority (2-1) affirmed the judgment. Judge Michael (joined by a visiting district court judge) concluded that the record supported the finding that the employee was regarded as disabled. Evidence included an e-mail from the president to HR stating that the employee was disabled and "qualifies for ADA designation," the history that the company originally ignored the employee's medical release to return to work, a pattern of senior management treating the employee "like [he] was a handicapped person," and the company's refusal to train or allow the employee to use the computer for tasks central to his job. These behaviors, according to the panel, showed that the employer "believed that Wilson's Parkinson's symptoms were substantially more limiting than they actually were, as indicated in further findings by the district court and the record." The panel also found that the district court could have reasonably disbelieved the company's various proffered reasons for the termination.
"After the district court rejected that position, finding that he did not prove actual limitations of major life activities, he is left to argue the opposite position, that he was not so disabled but Phoenix Specialty regarded him as so disabled. The viability of such a position, however, tends to collapse in the switch, because: (1) Wilson did not suffer limitations of major life activities; (2) Phoenix Specialty fully understood the limitations he was suffering at the time he was terminated and thus could not have misperceived them; and (3) there was no evidence or finding that Phoenix Specialty incorrectly believed that Wilson was substantially limited as to major life activities."
The second case, EEOC v. Federal Express Corp., No. 06-1724 (4th Cir. Jan. 23, 2008), concerned a jury verdict for the Commission that FedEx failed to provide reasonable accommodations for a deaf package handler (lockhart), for failure to provide an American Sign Language (ASL) interpreter. The jury awarded $8,000 in compensatory damages and $100,000 in punitive damages. The appeal focused solely on the punitive damage award. While the company did not deny that the relevant decision-makers were managers (for purposes of applying Kolstad v. American Dental Association, 527 U.S. 526 (1999)), it challenged the conclusions that it neither accommodated the employee, nor engaged in good-faith efforts to comply with the law. As to the former, the panel held: "that [Ramp Operations Manager] Cofield knew of his ADA obligation to provide reasonable accommodations to Lockhart for his deafness disability, and thus perceived the risk that his failure to do so would violate the ADA. For example, although Cofield did not receive any ADA training from FedEx, he had contacted other FedEx officials . . . seeking clarification on what might constitute reasonable ADA accommodations for Lockhart."
"In spite of such notice, there is no evidence that any alarm bells sounded in FedEx offices. Neither [Senior Operations Manager] Hanratty nor any other FedEx officials took steps to ensure that Cofield, as Lockhart's immediate supervisor, was adequately prepared to implement FedEx's ADA compliance policy. No one advised Cofield to consult the ADA policy statement in the People Manual, which emphasizes the mandate of the ADA and its reasonable accommodations requirement. Although Hanratty had himself received training from FedEx on ADA compliance, he denied Cofield's own request for such training. Nor did FedEx show that the steps Cofield eventually took to provide accommodations to Lockhart resulted from Cofield's reference to the People Manual or consultations with his superiors at FedEx. These omissions were significant given that, prior to Lockhart being hired, Cofield had never supervised a hearing impaired employee."
"Although Lockhart suffered no physical harm from the actions complained of, his supervisors at FedEx were plainly indifferent to the fact that their failure to accommodate his disability could jeopardize his safety, and potentially implicate the safety of others. Because Lockhart was denied the ADA accommodations necessary for him to understand participate in employee meetings and training sessions, he consistently missed updates about important subjects such as workplace safety, handling dangerous goods, interpreting hazardous labels, and potential anthrax exposure. Finally, Lockhart's supervisors were familiar with the mandate of the ADA and perceived the risk that their conduct was unlawful. Under the evidence, the jury was thus entitled to find that FedEx higher management officials, including Cofield and Hanratty, had acted reprehensibly with respect to Lockhart's need for ADA accommodations."
The employer also challenged the size of the punitive damage award in proportion to the actual damages. But in addition to finding that the award met the due process guideposts (BMW of North America, Inc. v. Gore, 517 U.S. 559 (1996)), it also observed that the award was well within the caps set under Title VII: "[T]hat the punitive damages award, when aggregated with the compensatory damages award, was substantially below the $300,000 statutory cap on such damages, as provided for by 42 U.S.C. § 1981a, provides addition al support for the reasonableness and constitutionality of the punitive damages award. The statutory cap of $300,000 provided FedEx with fair notice of the range of available civil penalties for acts of discrimination that contravened the ADA."
The Supreme Court on Tuesday, January 22, invited the Solicitor General to file its views in Hulteen v. AT&T Corp., No. 04-16087 (9th Cir. Aug. 17, 2007) (see my August 20, 2007 entry on this case). This case regards the application of (1) the timing principles in Bazemore, Morgan and Ledbetter and (2) retroactivity principles to a claim that awarding pre-1979 pregnancy leave (i.e., prior to the adoption of the PDA) less pension credit than comparable disability leave violated the Pregnancy Discrimination Act of 1978, 42 U.S.C. § 2000e(k) . The en banc Ninth Circuit held that the claims are valid because denying equal treatment to pregnancy and non-pregnancy leave in the present day is facially discriminatory, even if that classification might have been lawful before 1979. The Seventh Circuit, in a case involving the same employer, disagrees with the Ninth Circuit (Ameritech Benefit Plan Committee v. Communication Workers of America, 220 F.3d 814 (7th Cir. 2000)), raising the probability the certiorari will be granted.
The Supreme Court also on Tuesday denied certiorari in Green v. Dillard's Inc., No. 06-1918 (8th Cir. Apr. 5, 2007), in which the plaintiffs -- two retail shoppers -- allegedly faced an ugly, racially-hostile situation when they tried to buy a watch behind a locked case. The Eighth Circuit analyzed and decided, in the shoppers' favor, the basis for vicarious liability under 42 U.S.C. § 1981 when a non-supervisory employee commits retail discrimination. "While there is here no evidence of discriminatory policies or discriminatory acts by managers for which Dillard's could be held accountable, plaintiffs have made out a prima facie case of negligence. Under agency law an employer is directly liable for harm resulting from his own negligent or reckless conduct. See, e.g., Restatement (Second) of Agency § 213 & cmts." At least for now, this will remain the law in the Eighth, and also the Fifth, Circuits.
"1. Appellants complained to Susan Lee, Director of Equal Employment Opportunity at the University of Denver, and Department Chair Luc Beaudoin about their unfavorable and biased treatment during the Assistant Professor search in February 2003 and also about their perception of the sexist treatment of a teaching candidate, Joseph McClanahan. Appellants were allegedly subjected to public humiliation at a February 2003 department-wide meeting.
"2. On February 17, 2003, Appellants met with Dean Kvistad, Chair Beaudoin and Professor DiFranco, who explained that they had elected to postpone the search for an Assistant Professor. Chair Beaudoin convened a Department meeting to vote on a decision regarding the search.
"3. Dean Kvistad allegedly takes a lecturer position away from the Spanish Section.
"4. On April 9, 2003 Chair Beaudoin allegedly precluded Appellants from selecting a Spanish section lecturer.
"5. Chair Beaudoin allegedly prevented them from participating in the search process for a new Spanish section lecturer.
"6. Appellants met with Dean Kvistad and Susan Lee where they raised issues of a hostile working environment and discriminatory, disparate treatment. On June 15, 2003 Miriam Bornstein-Gómez asked Dean Kvistad for compensation as section coordinator.
"7. Chair Beaudoin allegedly allowed Javier Torre, a junior Spanish faculty member, to harass Appellants.
"8. Appellants filed their discrimination complaints with Susan Lee against Chair Beaudoin and Javier Torre.
"9. Appellants wrote to Provost Coombe, Dean Kvistad and Chair Beaudoin about Torre's harassing and retaliatory behavior.
"10. Chair Beaudoin allegedly abolished the Spanish section.
"11. Appellant Bornstein-Gómez sent another memo to Javier Torre outlining the ongoing harassment by Torre which was copied to Provost Coombe, Dean Kvistad and Chair Beaudoin.
"12. On December 1, 2003, Appellants filed their first Equal Employment Opportunity Commission complaint.
"13. Appellant Miriam Bornstein-Gómez was allegedly precluded from participating in the selection of the Basic Language Coordinator for the Spanish program.
"14. In October 2004, Appellants filed their second Equal Employment Opportunity Commission complaints, and on February 25, 2005, they filed their lawsuit. Department Chair Jennifer Pap allegedly made alterations to the Spanish section."
"Appellants have waived the issues of increased workload and low merit salary increases, as noted earlier. We have no doubt that having to address the individual personalities in a work environment may be daunting at times. However, it cannot be said that negative comments, condescending looks, perceived exclusion from hiring and firing decisions, and a reduction in the administrative authority within the department aggregate to produce material and adverse actions against these Appellants. Therefore, we find that the Appellants have failed to satisfy their burden under Burlington Northern of presenting a prima facie case of employment retaliation."
While it is uncertain how this particular case was litigated, it bears considering that ordinary slights in the typical work environment may take on a different complexion in higher education: "Universities have few 'carrots' to dangle in front of tenured faculty members who reach full professorhood. The subtle indicia of job status and reward thus may, in a particular institution, take on an importance that may be far greater in context than would appear on the outside-indicia like honorary or in-house titles (that may have no budgetary effect, unlike their administrative counterparts) and committee assignments," Bryson v. Chicago State Univ., 96 F.3d 912, 916-17 (7th Cir. 1996).
06-1505 MEACHAM, CLIFFORD B., ET AL. V. KNOLLS ATOMIC POWER LAB., ET AL.
"The motion of AARP and National Lawyers Association for leave to file a brief as amici curiae is granted. The petition for a writ of certiorari is granted limited to Question 1 presented by the petition. The brief of petitioners is to be filed on or before Monday, February 25, 2008. The brief of respondents is to be filed on or before Monday, March 24, 2008. A reply brief, if any, is to be filed in accordance with Rule 25.3 of the Rules of this Court. Justice Breyer took no part in the consideration or decision of this motion and this petition."
"The petition for writ of certiorari [is] granted. The briefs of petitioners are to be filed on or before Monday, February 25, 2008. The brief of respondent are to be filed on or before Monday, March 24, 2008. Reply brief, if any, [is] to be filed in accordance with Rule 25.3 of the Rules of this Court."
The Solicitor General had recommended that the Court accept cert in this case. There was also an amicus filed jointly by AARP and the National Employment Lawyers Association (the Court order got the name of the organization wrong). Given the modest number of ADEA disparate impact cases coursing through the system, its hard to know what real-world impact this case is likely to have.
The second case Crawford, which is likely to throw fear in the hearts of HR professionals, is a Title VII retaliation case. The issue is whether an employee's involvement in an internal investigation of discrimination falls within the participation or opposition prong of the Title VII anti-retaliation section: "Whether and to what extent Title VII's anti-retaliation provision protects employees from being fired for cooperating with an employer's internal sexual harassment investigation."
Take a read and prepared to be astonished: Goldsmith v. Bagby Elevator Co. Inc., No. 06-14440 (11th Cir. Jan. 17, 2008). This 65-page opinion, affirming a jury verdict for a fired African-American employee in a Title VII/§ 1981 case, is one of the most powerful civil rights opinions I've read from any U.S. Court of Appeals in quite some time, even more remarkable for emerging from the Eleventh Circuit (a venue notoriously hostile to civil rights plaintiffs generally) and signed by Judge William Pryor, who deeply disturbed progressives when he was nominated (see one pre-confirmation take on the judge here).
"Forty-five years ago, 'the civil rights movement swirled into Birmingham, a city whose bitter resistance to change made it a battleground.' Jack Bass, Unlikely Heroes 201 (1981). Dr. Martin Luther King Jr. remarked, 'If we can crack Birmingham, I am convinced we can crack the South. Birmingham is a symbol of segregation for the entire South.' Id. By blood, toil, and tears, segregation was, of course, cracked in Birmingham, and today the city is led by its fourth black mayor and a majority-black city council. Against this historical backdrop, this appeal from the Northern District of Alabama offers, amid a host of technical issues, an important reminder: despite considerable racial progress, racism persists as an evil to be remedied in our Nation."
The facts are straightforward enough. The employee (Goldsmith), an elevator fabricator in a shop in Birmingham, faced persistent race-baiting by his foreman (Farley) and the foreman's nephew (Walker), including the usual name-calling (read the opinion for details). There was evidence of a death threat by the nephew. Goldsmith's complaints about the harassment were met with management shoulder-shrugging. (A vice president responded, "Well Goldie, you know, that's just the way Ron [Farley] is. You are just going to have to accept it.") The company also screened black employees out of the more-lucrative field jobs. Other African-American employees testified at trial that they suffered harassment and discrimination. Although the company published an anti-discrimination policy, there was no evidence that the company ever enforced it, with the company president even admitting that he was "not that good on the [antidiscrimination] policy."
"In the end, Isbell signed the agreement after being urged to reconsider, but Goldsmith was treated differently. After Isbell packed his belongings, Bowden stopped Isbell from leaving the shop and told Isbell that he should not resign because of the agreement. Bowden urged Isbell to talk to someone about the agreement. Isbell later signed the agreement after he consulted a union representative, and Bagby Elevator did not fire him when he returned the signed agreement the next day. Bowden did not ask Goldsmith to reconsider. Goldsmith contended during trial that Bowden's failure to ask Goldsmith to reconsider suggested that supervisors at Bagby Elevator wanted to convince white employees, but not black employees, to remain at Bagby Elevator."
Goldsmith asked that the policy be re-written not to apply to his pending charge, but was rebuffed. Eventually, the company fired Goldsmith, who filed a discrimination and retaliation suit. The jury awarded him $27,160.59 in back pay, $27,160.59 in damages for mental anguish, and $500,000 in punitive damages. The judge affirmed the verdict and entered judgment.
"After witnesses who were members of Bagby Elevator management denied hearing this comment, the court permitted Goldsmith to call McFall to impeach the testimony of managers of Bagby Elevator. Goldsmith recalled Ward to the stand to question him about the comment, and Ward admitted that he was in the witness room with Arthur Bagby but stated that he did not remember the comment. Goldsmith then called McFall to testify, over the objection of Bagby Elevator that she was a court employee and would present prejudicial testimony. McFall testified about Arthur Bagby's comment."
"Bagby Elevator was not unfairly prejudiced by the courtroom deputy's testimony. Bagby Elevator was aware of the policy of the district court that its courtroom deputy would report stray remarks. The courtroom deputy had previously reported a comment made by a black juror who was later dismissed because of the comment, and Bagby Elevator did not object to the application of this policy to dismiss the juror.
"Bagby Elevator had the benefit of several procedural safeguards to prevent any undue prejudice. Bagby Elevator cross-examined the courtroom deputy on the comment. See Parker v. Gladden, 385 U.S. 363, 364-65, 87 S. Ct. 468, 470 (1966). Bagby Elevator recalled Ward to elicit testimony about this alleged comment, and the courtroom deputy testified only after Ward stated that he did not remember hearing the comment. The district court instructed the jury that the courtroom deputy's testimony should not suggest that the district court or its employees had an opinion about the merits of the case. In the light of these safeguards, Bagby Elevator was not unduly prejudiced when the district admitted the testimony of the courtroom deputy."
The court also held that while circuit authority (in Weeks) licensed employers to adopt mandatory arbitration, this case was different because it would have applied retroactively to a pending change. "Goldsmith was terminated immediately after and because he refused to relinquish his right to a jury trial for his pending charge. Goldsmith offered to sign an amended agreement that would exempt his pending charge from arbitration, but Bagby Elevator refused to accept the amendment. When it fired Goldsmith, Bagby Elevator was aware of Goldsmith's charge of discrimination. No other employee had a pending charge when Goldsmith was terminated, although other employees with pending charges had been terminated earlier. When another employee objected to the dispute resolution agreement, the employee was urged to reconsider, but Goldsmith was not. Taken together, this evidence was sufficient for a reasonable jury to find a causal relation between the filing of Goldsmith's charge of discrimination and his termination."
There is much else to examine in this decision, and I commend it for soothing bedtime reading for civil rights lawyers practicing in that circuit.
Sturgill v. UPS, No. 06-4042 (8th Cir. Jan. 15, 2008), presents a classic religious-accommodation fact pattern: a driver whose Friday shift drifted past sundown, when his Sabbath began. Therein, the Eighth Circuit addresses a conflict in the circuits about how to define the employer's burden to accommodate religious belief, and declares (in a footnote) a startling view on the availability of legal relief in these cases.
The employee -- a convert to the Seventh-Day Adventist faith -- had in May of 2004 sought an exemption from work late Friday afternoons, but apparently no acceptable arrangement was possible under the collective bargaining agreement (CBA). UPS advised him to bid on a "combination job" (which had a suitable schedule) as soon as one became available. As an interim accommodation, his supervisor allowed Sturgill to split his load with other drivers, an arrangement that had been used with other employees who needed an afternoon off.
On December 17, 2004, under a load of pre-Christmas packages that he could not deliver by sundown, Sturgill returned to the UPS Springdale, Arkansas Center with his route unfinished. He had not been allowed to split the load and was warned that abandoning the load would result in his being fired. He unsuccessfully grieved his termination and later filed his Title VII suit.
Sturgill persuaded a jury that UPS could have accommodated him by splitting his load with another driver, as the dispatcher had done in the past. The record included evidence "that given the enormous volume handled by Springdale drivers during peak season, relieving him of overtime work on Fridays would only negligibly increase other drivers' workloads and might reduce UPS's costs because the drivers that regularly covered Sturgill's route had less seniority and a lower hourly wage rate." He was awarded $103,722.25 in compensatory and $207,444.50 in punitive damages, and the court added reinstatement, front pay, an injunction and attorneys fees and costs.
"For these reasons, we conclude that the district court erred in instructing the jury that a reasonable accommodation must eliminate the religious conflict, an instruction that improperly took that issue from the jury. To be sure, there may be many situations in which the only reasonable accommodation is to eliminate the religious conflict altogether. But in close cases, that is a question for the jury because it turns on fact-intensive issues such as work demands, the strength and nature of the employee's religious conviction, the terms of an applicable CBA, and the contractual rights and workplace attitudes of co-workers. Bilateral cooperation under Title VII requires employers to make serious efforts to accommodate a conflict between work demands and an employee's sincere religious beliefs. But it also requires accommodation by the employee, and a reasonable jury may find in many circumstances that the employee must either compromise a religious observance or practice, or accept a less desirable job or less favorable working conditions."
But while the district court erred, the panel held on the facts of the case that the error had no probable effect on the verdict, because of UPS's complete failure to accommodate Sturgill on the day in question, in spite of a pain-free alternative of splitting the load: "[Sturgill's] Supervisor Hadaway informally accommodated Sturgill every Friday before December 17, but this reflected Hadaway's efforts to accommodate diverse driver preferences, not Sturgill's religion. Indeed, Hadaway testified that, if so instructed in advance, he could have accommodated Sturgill on December 17, apparently without violating the CBA."
Reaching the issue of relief, the Eighth Circuit holds -- without citation to any other authority -- that a denial of reasonable accommodation would not entitle an employee to legal relief under 42 U.S.C. § 1981a(a)(1), which pertains only to "intentional" discrimination. The panel contrasted an accommodation claim with a claim of religious discrimination. Plaintiff presented both at trial, but won only the former. The panel characterizes a reasonable accommodation claim as following a "negligence" rather than "intentional" theory.
This holding appears, frankly, shocking. Would not the same standard apply to a hostile work environment case under Title VII, where the failure to remediate co-worker harassment is also measured by a negligence standard? Wasn't the lack of such a remedy a major impetus to Congress's addition of legal remedies in the 1991 Civil Rights Act? Has the Eighth Circuit written an important remedy out of the statute? Indeed, doesn't this take juries right out of the picture in these cases? Sturgill's verdict avoids the axe only because the employer neglected to object to the damage instruction, but the Court warns that giving a damages instruction in such cases in the future may be plain error.
The panel also held (citing a decision by Judge Mark Bennett of the Northern District of Iowa) that the employer's failure to accommodate proximately caused the employee's termination, supporting reinstatement, front pay and other relief. The court tossed the punitive award, though, finding that the employee failed to demonstrate malice: "UPS demonstrated that it followed a nationwide, multi-step protocol for considering employee requests for religious accommodations. No UPS employee was shown to have acted with malice or reckless indifference to Sturgill's accommodation request. The district and regional managers concluded, after consulting a union representative, that Sturgill's suggested accommodations would violate the CBA or disrupt UPS operations. Accordingly, they denied his request and suggested he use his seniority to bid on a combination job when available." The bottom line was that the denial of accommodation was "nothing more than violation of a Title VII negligence standard."
Finally, the panel affirmed the award of fees in full, finding that the unsuccessful discrimination claim was an alternative theory, and that counsel would have devoted substantially the same time to both claims. As to costs, the Eighth Circuit held that travel and process-server expenses were recoverable under 42 U.S.C. § 2000e-5(k).
Fichman v. Media Center, No. 05-16653 (9th Cir. Jan. 14, 2008) considers whether the producers of public access programming -- the Wayne and Garth of "Wayne's World" -- may be deemed "employees" when counting (up to 15 or 20) for purposes of coverage under the ADEA and the ADA. The district court held that various titles associated with defendant Media Center -- the producer of public access shows -- did not fit the definition of "employees," and the Ninth Circuit affirmed.
First, the court holds that the Board of Directors are not employees. "[The] Media Center Board of Directors could not be counted as employees under the ADA and ADEA. This question is governed by the United States Supreme Court's analysis in Clackamas Gastroenterology Associates, P.C. v. Wells, 538 U.S. 440 (2003)." They labored as volunteers just 2-4 hours a month, without pay, in contrast to regular staff. Their task was to set policy for the Media Center. "The personal satisfaction and professional status several directors reported gaining from their positions with Media Center are typical benefits of volunteer work." The only tangible "benefit" they received was director and officer insurance.
Neither were the independent producers properly classified as "employees," whom the Media Center simply trained on the studio equipment and then had sign contracts to use the facility. "Media Center does not have the power to hire or fire producers. It does not supervise them in a traditional employer-employee manner. The producers are not paid a salary, nor are they entitled to employee benefits."
This pregnancy discrimination case (brought under Michigan state law) illustrates two maxims that I always drill into employment lawyers when I do conferences: jury verdict forms can be your worst enemy (and require utmost attention), and remedy must be the forefront (not afterthought) of your trial plan: Lulaj v. The Wackenhut Corp., No. 06-2163 (6th Cir. Jan. 11 2008).
The plaintiff and her counsel succeeded fabulously at navigating her case to trial, and obtaining a good result -- $11,160 medical expenses, $5,712, non-economic damages; $49,500 fees and costs. The jury also awarded $75,788 back pay and $67,340 front pay -- apparently under Michigan law, you get a jury on these issues -- but after trial this was remitted to just $960 total (the difference between the promotion she sought and the job she held until she quit). The reason was that the jury found for the employee on her promotion claim, but not her constructive discharge claim.
"Wackenhut points to the fact that Lulaj informed the company of her pregnancy only four days before the promotion decisions were completed and claims that its promotion decisions could not therefore have been tainted. Lulaj however presented evidence on three points, (1) company managers were aware of her pregnancy long before she officially informed them, (2) the timing of the events suggests discrimination, and (3) the way her superior glanced at her stomach suggested that pregnancy was a factor in denying her promotion."
That Wackenhut offered a different promotion to the employee at the same time did not ameliorate the discrimination, where the promotion was to a lesser position.
Unfortunately for the plaintiff, she did not persuade the jury to go the full distance and lost her constructive discharge claim. Yet the jury still awarded back and front pay relief, and the Sixth Circuit panel understandably holds that the district court properly entered a final award worth a mere two-thirds a percentage point of the original amount. "The jury found that Lulaj was not constructively discharged. Voluntarily quitting her job tolls Lulaj's claims for back pay as a matter of law. Thus the district court was correct to reduce, as a matter of law, the jury award for front pay to zero to conform to its finding of no constructive discharge."
On the back pay claim, the employee argues that she was entitled not only to the small amount ordered, "because it failed to consider the value of other benefits, such as medical insurance." True in principle, but the panel finds that "the district court determined that no evidence was offered upon which a fact-finder could base a pay calculation other than the difference in hourly wage. Because there was no evidence to support the jury's finding of damages beyond the wage difference, and because there is no issue as to the calculation of that wage difference, the district court was correct to reduce the award to $960 as a matter of law." So plaintiffs' counsel must always consider ahead of time the probability that the jury might need that benefits information, which was almost certainly uncontested, and could have been worth thousands of dollars to the employee.
Here's a (non-employment) tale of arbitration gone awry that ends well for the plaintiff: Uhl v. Komatsu Forklift Co., No. 07-1044 (6th Cir. Jan. 9, 2008). This was a wrongful death case involving a Komatsu forklift, filed in federal district court. The widow and the insurer who intervened (Pacific Employer's Insurance) inked a post-dispute arbitration agreement with Komatsu which provided for a panel of two party arbitrators and a neutral. The case was dismissed, with jurisdiction retrained to review the award.
"First, Komatsu claims that a paralegal at the hearing overheard Stein tell the other arbitrators '[t]hat [defense counsel] Fresard is a prick.' J.A. at 252-53 (Dec. 7, 2007, Mot. to Enf. Award Hr'g Tr. at 12:23-13:5). Second, Komatsu claims that Stein closed his eyes during Komatsu's arguments and did not pay attention to its attorneys. Third, Komatsu claimed that Stein did not inspect the forklift with the other arbitrators until Komatsu's attorneys found him in the hotel. Fourth, Komatsu claimed that several evidentiary decisions by the panel of arbitrators were suspect and that Stein 'always argued for the Plaintiffs' motion.' J.A. at 256 (Hr'g at 16:2-23). Komatsu, however, did not object to any of these alleged events during the arbitration hearing."
The award came back for plaintiffs at $1.9 million. Komatsu, not unexpectedly, moved in court to vacate the award. But the district court confirmed the award, finding that there was no conflict of interest between Stein and Johnson based on a former business relationship and that Komatsu waived the argument by failing to object to Stein's alleged hijinks.
Even employee activists have to cheer a result (albeit abetted by an insurance company) that arose from arms'-length, voluntary arbitration.
How thick does a district court judge (or the governing law) have to be to misunderstand this: "I don't want to hire an old pilot" = age discrimination?
In Van Voorhis v. Hillsborough County Board of Commissioners, No. 07-12672 (11th Cir. Jan. 8, 2008) (per curiam), the opinion sets the stage: "In April 2002, Hillsborough County posted a job opening for a helicopter pilot in its Mosquito Control Section. Joel Jacobson, manager of the Mosquito Control Section, was in charge of hiring. The open pilot position was one of two such positions in Mosquito Control. Dennis Boone, the chief helicopter pilot for Hillsborough County, was the other pilot. Jacobson was Boone's direct supervisor."
When all of the applicants turned out to be 40 years or older (plaintiff was over 50), "[a]ccording to Boone, Jacobson reviewed the list of qualified applicants and stated that 'he did not want to interview [any of the applicants] because he didn't want to hire an old pilot.' Linda Hangar, whose office was next to Jacobson's office, testified in an affidavit that she also overheard Jacobson comment that he did not want to hire an old pilot. No interviews were conducted during the first recruitment period."
The eventual hire (Pamela Knight, age 40) did not have the minimum 100-hour flying time required for the job, so the county removed that qualification during a second round of recruitment, despite that the FAA "requir[ed] at least 100 hours of spraying flight time before operating a helicopter used for agricultural spraying over a congested area."
The applicant then files an appeal pro se and wins a reversal. The court has no problem finding that the manager's remark in the first recruitment period about not wanting to hire an "old pilot" was direct evidence of age discrimination. The district court also erred in holding that there was no "adverse employment action" because the plaintiff filed an incomplete application during the second recruitment period. "The rejection of Van Voorhis's application during the first recruitment period was an adverse employment action about which Van Voorhis complained."
Here are the first two published EEO decisions for 2008, and both arise from jury trials.
The Fifth Circuit had up to this point avoided a direct confrontation with whether a punitive-only award could be sustained under Title VII or section 1981, but had held that no such award was allowed under the Fair Housing Act. Because courts must consider (at least in common-law cases) the proportionality of compensatory and punitive damages, owing to due process concerns -- BMW of North America v. Gore, 517 U.S. 559 (1996) -- and analysis of excessiveness, the absence of actual damages removes an important datum from the equation.
Given the uncertainty in the law, the employees pointed to the employer pointed to Fifth Circuit case law holding that the "a punitive award may stand in the absence of actual damages where there has been a constitutional violation." So did a section 1981 verdict land in the constitutional box or statutory box? The panel holds that, despite the Thirteenth Amendment roots of section 1981, a claim brought under that act is statutory in nature. But the panel then goes on to reconcile decades' worth of its own wobbly precedents to hold that, in a Title VII and section 1981 case, the presence of the Title VII caps -- combined with the "high threshold" necessary to prove punitives -- substitutes for the need to show proportionality. Thus, "a punitive damages award under Title VII and § 1981 need not be accompanied by compensatory damages." The Fifth Circuit thus placed itself with the Second and Seventh Circuits, which had previously so held, leaving the First Circuit on its own as requiring proof of actual damages.
"Elgie Abner testified about picking up a toolbox on which someone had written, 'You lazy ni _ _ _ _ s' and that, when he presented the box to a supervisor, the supervisor laughed. He also testified that a cement pillar in the workshop contained a large marking of 'KKK' for a number of years, as did the fuel tanks and roofs of many locomotives in the shop, and that in May of 2005, 'Abner is a lazy racist' was written on the walls in the bathroom of the workshop.' 'Ni _ _ _r go home' and 'Lazy ni_ _ _ _s' were also written on the walls. Harry Brooks testified that foreman Gary Moore would, on the night shift, wait until a large thunderstorm came and then, laughing, send the workers out in the storm.53 He also testified that an electrical wire in the form of a noose was hanging outside of the workshop, that there was graffiti in the workshop bathrooms that said, 'Ni _ _ _ _ s stink' and 'Ni _ _ _ _ s go home,' and that supervisors 'knew' of the graffiti and the noose. Napoleon Player testified that a supervisor called him 'boy' in 1995 and that Gary Moore referred to him as a 'rice-eating Ethiopian' and said that he was going to run two 'black a _ _ es off.' In 1995, Moore also allegedly referred to Napoleon Player's shift as the 'c_ _n shift.' Napoleon Player also testified that he did not recall receiving any racial harassment training prior to retiring in June of 2003. Mr. Odom similarly testified that 'the first [racial harassment policy] I got was . . . if I'm not mistaken, August 2003.' Donald Harville testified that a company surgeon told him, when he arrived late for work in November of 2001, 'That's it for you and your ni_ _ _ _ buddies.'"
The Fifth Circuit concluded, on this point, that the nominal damage award was unnecessary to support the punitive award: "Because the award of actual or punitive damages is capped under Title VII, we do not require a ceremonial anchor of nominal damages to tie to a punitive damages award." The panel also found no abuse of discretion in (1) allowing the plaintiffs to present evidence of incidents going back as far as ten years, supporting the district court's conclusion that the incidents were part of a single claim; (2) admitting alleged hearsay erroneously under FRE801(d)(2)(D); and (3) miscellaneous alleged errors in the admission of one managers KKK-related conviction and the overruling of objections to plaintiffs' closing argument.
The Sixth Circuit files a four-pager that grinds to an unremarkable conclusion in Gruener v. Ohio Casualty Ins. Co., No. 05-4220 (6th Cir. Jan. 3, 2008), where the plaintiff challenged two aspects of the judgment entered against her in an ADA case following a defense verdict. Ms. Gruener, an IT professional, suffers from degenerative joint disease and lost her job because her medical restrictions prevented her from lifting and installing heavy equipment. On appeal she first complained that the district court did not submit her "regarded as" theory to the jury -- that the employe improperly "regarded" her as disabled within the meaning of the ADA. But the Sixth Circuit affirmed on the ground that the plaintiff presented no evidence to support that theory. The record revealed that any apprehension that the company had of the plaintiff's disability was not a "misperception" of her condition, but based on her actual impairments (in manual tasks and work) such that she "did not meet the physical requirements for her job." Second, she complained that the district court should have granted her motion for a new trial (based on clear weight of the evidence), but her attorney waived that claim by not amending the notice of appeal after the new-trial motion was denied. ERISA §§ 502(a)(3) and 510, 29 U.S.C. §§ 1132(a)(3), 1140.

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