Category Archives: Retaliation

July 13, 2015

EEOC’s Conciliation Efforts Must Be Real, Not “For Appearances Only,” After Mach Mining Decision

An unsupported demand letter cannot constitute an actual attempt by the Equal Employment Opportunity Commission (EEOC) to engage in the required pre-lawsuit conciliation process, according to a federal judge in Ohio. EEOC v. OhioHealth Corp. (S.D.Ohio June 29, 2015). In one of the first cases to review the sufficiency of EEOC conciliation efforts after that review was authorized by the U.S. Supreme Court in its April Mach Mining decision, it is clear that courts are not willing to rubber stamp the EEOC’s purported conciliation efforts and will delay the lawsuit until actual conciliation takes place.

Insufficient Conciliation Efforts Often Frustrate Employers

If the EEOC finds reasonable cause to believe that employment discrimination occurred, it is required to try to eliminate the alleged discrimination through informal conference and conciliation with the employer. The goal is to get the employer to voluntarily comply with federal discrimination laws and resolve the alleged discrimination privately. In fact, the conciliation process is a necessary precondition to the EEOC filing a discrimination lawsuit against the employer. The EEOC is prohibited from suing the employer until after its conciliation efforts have failed.

At times, employers have been frustrated by a lack of real conciliation efforts, particularly in cases where the EEOC seems to prefer going to court rather than settling with the employer. The Mach Mining decision was a win for employers as it allows an employer to ask a judge to conduct a limited review of the EEOC’s conciliation efforts before a lawsuit goes forward.

EEOC’s Affidavit on Its Conciliation Efforts

The Supreme Court had explained in Mach Mining that a sworn affidavit from the EEOC describing its conciliation efforts would usually suffice to show that it had met its obligations. Many who analyzed that statement feared that an EEOC affidavit would effectively end the employer’s challenge to the sufficiency of the EEOC’s conciliation efforts, resulting in an empty judicial review. But Judge Frost’s decision out of the federal court in the Southern District of Ohio shows that is not the case.

In this case, the EEOC submitted an affidavit that stated that the EEOC had issued a reasonable cause determination letter that invited the parties to join “in reaching a just resolution of this matter” and stating that “conciliation of this matter has now begun.” The affidavit further states that over one month, the EEOC communicated with the employer, OhioHealth, including sending a conciliation proposal which was rejected. The EEOC then sent OhioHealth a final letter stating that conciliation efforts had not been successful.

OhioHealth countered the EEOC’s affidavit by providing its own declaration which stated that the EEOC had made a take-it-or-leave-it demand and failed to provide any information to back up its demand. Even though the EEOC’s determination letter had indicated that a commission representative would prepare a dollar amount that included lost wages and benefits, applicable interest and any appropriate attorney fees and costs, no such calculation was ever provided by the EEOC to OhioHealth. OhioHealth stated that it remained ready and willing to negotiate but that the EEOC instead declared that conciliation efforts had failed.

Judge Frost ruled that the EEOC’s “bookend” letters – first declaring the conciliation process open and then closed — did not constitute an actual attempt at conciliation. He wrote that without the EEOC providing the calculation of the charging party’s damages to OhioHealth, the parties could not shape their positions and the “conciliation process could have been nothing but a sham.” The judge ordered that the EEOC’s lawsuit against OhioHealth be stayed for 60 days while the EEOC engaged in good faith conciliation.

Judge Frost went on to offer a cautionary note to the EEOC. He was disturbed by the EEOC’s statements that it simply would not reach a private resolution of this matter via conciliation and that only a public resolution would be possible. He admonished the EEOC, stating that its position was “ridiculous” and defied the statutory scheme, binding case law, the court and common sense. He wrote that if the EEOC failed to engage in good faith efforts at conciliation as ordered, the court would impose all available consequences, including contempt and dismissal of the lawsuit. Pretty strong words indeed!

Lessons for Employers

Although this is only one court’s review of one conciliation process, employers should be pleased that the Mach Mining decision may have teeth, with courts taking a serious look at the actual conciliation efforts being made. If faced with a reasonable cause determination from the EEOC (and assuming you do not want to go to court), make certain to engage in conciliation by responding to the EEOC’s communications. If the EEOC makes a settlement demand, ask for the calculation of damages that supports the demand. Remain ready and willing to negotiate and document that willingness in writing. And if the EEOC files a lawsuit against you without first making real conciliation efforts, consider seeking a stay of the case by asserting that the EEOC failed to meet a condition precedent to filing the lawsuit.

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April 29, 2015

EEOC Conciliation Efforts Are Reviewable, Says Supreme Court

By Dustin Berger

Employers have a narrow right to seek judicial review of the Equal Employment Opportunity Commission’s (EEOC’s) statutory obligation to give an employer adequate notice of the charges against them, including the identity of the employees (or class of employees) claiming discrimination, and to engage in informal resolution of the charges. In a unanimous decision, the U.S. Supreme Court ruled that courts have the authority to review whether the EEOC has met its duty under Title VII to attempt informal resolution of alleged discriminatory practices prior to filing suit. Mach Mining, LLC v. EEOC, 575 U.S. ___ (2015).

While the scope of review is limited, it is good news for employers as it limits the EEOC’s ability to take high priority cases to court without first engaging in any discussion with the employer to remedy the alleged unlawful practices. Unfortunately, however, under the Supreme Court’s decision, the courts’ review of the EEOC’s conciliation efforts will be too limited to ensure that the EEOC makes a genuine and meaningful attempt to reach a voluntary resolution of a charge before the EEOC sues.

Title VII Mandates Informal Methods of Conciliation

Title VII, the primary federal law that prohibits employers from discriminating against individuals on the basis of race, color, sex, religion, or national origin, sets forth a procedure to be followed by the EEOC when handling a complaint of employment discrimination. In part, the law requires that when the EEOC finds reasonable cause to believe discrimination occurred, it must first attempt to eliminate the alleged unlawful practice through “informal methods of conference, conciliation, and persuasion.” The EEOC may choose which informal method it chooses to attempt resolution of the charge, and the agency ultimately retains the right to accept any proposed settlement or to sue the employer.

Letter From EEOC Without Follow-Up Was Insufficient Conciliation Effort

In the case before the Court, a female applicant filed a charge alleging that Mach Mining, LLC had refused to hire her as a coal miner because of her sex. The EEOC investigated her charge and found reasonable cause to believe that Mach Mining had discriminated against not only that applicant, but also a class of women who had similarly applied for mining jobs.

The EEOC sent Mach Mining a letter inviting both the company and the female applicant to participate in informal conciliation and stated that an EEOC representative would contact them soon. That never happened. Instead, about a year later, the EEOC sent Mach Mining a second letter stating that “such conciliation efforts as are required by law have occurred and have been unsuccessful” and further stated that any further efforts would be “futile.” The EEOC proceeded to sue Mach Mining in federal court alleging sex discrimination in hiring.

Mach Mining asserted that the EEOC had failed to conciliate in good faith prior to filing suit, as was required by Title VII. Although the federal district court agreed with Mach Mining that it should review whether the EEOC had met its conciliation duty, the Seventh Circuit Court of Appeals overruled that decision and held that a party could not assert as a defense that the EEOC had failed to conciliate the claim as Title VII required. The Seventh Circuit explained that conciliation was solely within the EEOC’s expert judgment and that there was no workable standard that would allow judges to review that process. Furthermore, the Seventh Circuit believed that court review of conciliation would complicate Title VII lawsuits by allowing the focus of the litigation to drift from the merits of the Title VII claim to the sufficiency of the EEOC’s conciliation effort.

Although other federal appellate courts, however, have held that Title VII does allow a court to review the EEOC’s conciliation effort, there was no uniformity among the other appellate courts in what that review should entail. The Supreme Court agreed to take the Mach Mining case to resolve whether and to what extent courts may review the EEOC’s conciliation attempts.

Notice to Employer and Discussion Required

Justice Kagan, writing for a unanimous Court, first explained that courts routinely enforce compulsory prerequisites to suit in Title VII cases. Although Congress had given the EEOC wide latitude over the conciliation process, the Court refused to allow the EEOC to police itself on whether it had complied with its conciliation duty. Accordingly, it overruled the Seventh Circuit’s decision and held that courts have the authority to review whether the EEOC has fulfilled its Title VII duty to attempt conciliation of discrimination charges.

The Court then turned to the proper standard of judicial review. In other words, it considered what the EEOC must show in order to meet its conciliation duty as a precondition to filing suit. The agency argued for minimal review, suggesting that its letters to Mach Mining were a sufficient attempt at conciliation. Mach Mining argued for a much deeper review, urging that the Court adopt a standard from the National Labor Relations Act that would require a negotiation in good faith over discrimination claims. The Court rejected both approaches and took a middle line.

The Court explained that judicial review was available but was limited to ensuring that the EEOC provided the employer with notice and an opportunity to discuss the matter tailored to achieving voluntary compliance. The Court stated that the EEOC must inform the employer not only about the specific allegations of discrimination, but also about which employees (or what class of employees) have suffered as a result. Ordinarily, the Court noted, the EEOC’s “reasonable cause” letter will provide this notice. Then, the EEOC must attempt to engage in some form of discussion with the employer to give the employer a chance to remedy the allegedly discriminatory practices prior to being sued. That discussion may be in written or oral form and the EEOC will retain a great deal of discretion about how to conduct its conciliation efforts and when to end them.

Evidence of the conciliation efforts may be supported or challenged through written affidavits. Ordinarily, the EEOC’s affidavit will show it has met its conciliation duty, but employers may create a factual issue through affidavits or other credible evidence that indicates that the EEOC did not provide the requisite information about the charge or attempt to engage the employer in discussion prior to filing suit. If a reviewing court finds in the employer’s favor on such a challenge, the appropriate remedy is for the court to order the EEOC to engage in conciliation.

Confidentiality of Conciliation

In reaching its decision, the Court focused in part on Title VII’s non-disclosure provision. This provision states that “[n]othing said or done during and as a part of such informal endeavors may be made public by the [EEOC], its officers or employees, or used as evidence in a subsequent proceeding without the written consent of the persons concerned.” Mach Mining argued that this confidentiality provision meant only that the actions taken and statements made taken during conciliation could not be used as evidence of the merits of the claim. The Court rejected that argument and reiterated that the non-disclosure provision protects actions and statements made during conciliation from disclosure for any evidentiary purpose. And, the Court explained, the non-disclosure provision alone precluded the courts from engaging in any deeper inquiry into the EEOC’s actions during conciliation.

What This Means For You

As the EEOC has been aggressively pursuing employers on novel theories of discrimination, it is beneficial to have the ability to ask a court to review whether the EEOC provided proper notice of the allegedly discriminatory practice and the employees allegedly affected by it and offered the employer an effort to discuss the matter for the purpose of achieving voluntary compliance. Although this review is narrow, it is an improvement over the Seventh Circuit’s view because it gives employers a limited opportunity to hold the EEOC accountable for satisfying its statutory obligation to conciliate claims. If your organization receives a “reasonable cause” finding, be sure to track what efforts the EEOC makes to engage you in discussions to pursue voluntary compliance. If those efforts do not meet the standard announced by the Court, you can seek to compel the EEOC to make an effort compliant with its statutory obligations before it proceeds with its suit.

What the Mach Mining decision will not do, however, is allow an employer to seek the aid of a court in requiring the EEOC to make a genuine effort to achieve a voluntary resolution of a charge. For instance, the Mach Mining decision does not require the EEOC to negotiate in good faith, apprise an employer of “the smallest remedial award the EEOC would accept,” lay out the legal and factual basis for its position or any request for a remedial award, refrain from “take-it-or-leave-it” offers, or provide any particular amount of time for an employer to consider and respond to the EEOC’s position or offers. Accordingly, you are well advised to set expectations of the conciliation process at a low threshold and, to the extent you believe voluntary resolution is desirable, take the initiative in working with the EEOC after receiving a reasonable cause determination letter.

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April 20, 2015

You’ve Received a Discrimination Charge from NERC or the EEOC – Don’t Throw It in the Trash!

By Dora Lane

When asked about a discrimination charge sent to them months ago, a client once answered “I did not know what to do with it, so I threw it in the trash.” Needless to say, that was a bad idea. Unfortunately, many employers do not understand their obligations when faced with a discrimination charge and that can backfire if the charge is not informally resolved.

What is a discrimination charge?

Ordinarily, before an employee can bring a harassment, discrimination, or retaliation lawsuit in court, the employee must “exhaust their administrative remedies.” In plain English, they have to file a complaint (called a “charge”) with one of the administrative agencies responsible for enforcement of the respective employment laws before they sue the employer in court.

In Nevada, a charge may be filed with either the Nevada Equal Rights Commission (NERC) (state administrative agency) or the Equal Employment Opportunity Commission (EEOC) (federal administrative agency). Because of a work-sharing agreement between the two agencies, a charge filed with NERC is also deemed filed with the EEOC (though the opposite is not true). A charge ordinarily includes the name of the employee who submitted it, a brief summary of the employee’s allegations, and certain applicable deadlines. Where the charge is filed matters because different requirements for responding to it apply.

What are the differences between responding to a NERC charge versus an EEOC charge?

An employer should respond to any discrimination charge, regardless of the agency in which it was filed, or risk an adverse determination based only on the employee’s evidence. However, there are differences in the type of information you must provide and the timing of your response, depending on which agency sends you the charge.

EEOC charge notifications are usually accompanied by Requests for Documents/Information. These requests must be answered and submitted along with a position statement addressing the allegations in the charge. The requests are frequently quite sweeping, requiring a lot of time and attention. NERC does not usually include Requests for Documents/Information in its charge notification packets. Rather, such requests may be sent – on a case-by-case basis – as part of the investigation process. (Of course, the EEOC may also request additional information during the course of its investigation.)

Another difference is the timing of submitting a position statement if the charge proceeds to mediation (called “Informal Settlement Conference” by NERC). If you receive a charge notification from NERC, the notification comes in a packet, which also usually contains an Election of Response form. That form lets you choose whether or not you wish to participate in an Informal Settlement Conference, which is automatically scheduled on a certain date. If you do not respond by the election deadline or you decline the conference, the charge is ordinarily placed into investigation.

Even if you choose to participate in the Informal Settlement Conference before NERC, however, you still must submit a position statement approximately a week before the conference. A potential cost-saving measure is to provide a brief, summary position statement first, in anticipation that the matter will resolve at the Informal Settlement Conference, and reserve the right to supplement at a later date in the event it does not.

By contrast, with EEOC charges proceeding to mediation, you are only required to submit a position statement if the case does not settle during mediation. That said, in some cases, it may be useful to give the mediator a brief factual background offering your company’s perspective prior to the mediation.

What if I did not get notice that I can mediate or participate in an Informal Settlement Conference?

If you receive a NERC charge notification without an Election of Response form, you might consider contacting NERC to ask for one. NERC schedules Informal Settlement Conferences as a matter of course, and it is highly unusual not to be invited to one. Sometimes lack of invitation has resulted from inadvertent administrative oversight so if you want to pursue early settlement, ask for a conference.

If you receive an EEOC charge notification that does not allow for mediation, it may stem from various reasons, which may or may not be a cause for concern. For example, there might have been an unintentional failure to check the “Mediation” box. Or, it is possible that the complaining party was not interested in mediation. Or, in the worst case scenario, the charge was not eligible for mediation because it was characterized as a “Category A” charge. “Category A” charges involve matters considered priorities by the EEOC, allegations of widespread legal violations by the employer, or other matters where the EEOC has concluded that further investigation would probably result in a cause finding (i.e., determination against the employer).

If you are interested in mediating an EEOC charge, consider contacting the EEOC to inquire whether mediation would be available, even if the mediation box is not checked, as the EEOC’s response may offer some information as to the basis for the initial mediation unavailability. And, while the EEOC would rarely admit that the charge is “Category A,” that information might enable you to prepare for the EEOC’s upcoming investigation.

What should I do when I get the charge?

First and foremost, you should immediately preserve all relevant documents and information, in both paper and electronic format. You should also suspend all automatic electronic deletion policies and direct your employees not to destroy anything related to the allegations in the charge. In some cases, it may be appropriate to make forensic images of computer hard drives to preserve the integrity of metadata and other electronic information.

Second, if an internal investigation has not already been conducted, you should investigate the complaining party’s allegations and begin gathering relevant information to prepare for defending the charge. Sometimes that includes collecting employee statements which can later be used to support your response to the charge.

Finally, take your obligation to provide a position statement seriously. Position statements should be prepared by – at a minimum – an experienced human resources professional. Better yet, contact your employment counsel. Position statements not only shape the administrative agencies’ investigations and conclusions, but they are also discoverable in litigation. So, even though employment disputes are not criminal in nature, it is wise to heed the Miranda warning that “anything you say will be used against you” in court.

Bottom Line: Responsibilities Flow From Receipt of a Charge

As tempting as it may be to ignore or dismiss an EEOC or NERC charge, resist the temptation and take steps to protect your organization from potential liability. Deadlines are triggered from the charge notification. Failure to preserve all relevant evidence can result in severe sanctions, including ruling against your organization on the ultimate discrimination, harassment, or retaliation issue. Failing to conduct an internal investigation can limit your ability to properly defend against the employee’s claims and to determine your possible liability. In short, no good can come from ignoring a charge. Instead, follow the steps outlined above to put you in the best position to handle the allegations and minimize liability to your organization.

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April 14, 2015

EEOC Fails to Show Telecommuting Would Be A Reasonable Accommodation

By Mark Wiletsky

The Americans With Disabilities Act (ADA) “does not endow all disabled persons with a job—or job schedule—of their choosing,” according to the majority of judges on the full Sixth Circuit Court of Appeals. In an 8 to 5 decision, the Sixth Circuit Court ruled en banc that Ford Motor Company did not violate the ADA when it denied an employee’s request to telecommute up to four days per week in order to accommodate her irritable bowel syndrome. EEOC v. Ford Motor Co., No. 12-2484 (6th Cir. Apr. 10, 2015).

“Good, Old-Fashioned Interpersonal Skills” Made In-Person Attendance Essential

The Equal Employment Opportunity Commission (EEOC) argued that a resale buyer for Ford, Jane Harris, who had irritable bowel syndrome that made it difficult for her to be far from a restroom, should be allowed to work from home up to four days per week. The agency cited Ford’s telecommuting policy that allowed other workers, including some resale buyers, to telecommute as evidence that Harris’ telecommuting request was a reasonable accommodation under the ADA.

The Court disagreed. It ruled that regular and predictable on-site attendance was an essential function of the resale-buyer position at Ford. Resale buyers needed to purchase raw steel from steel suppliers and then resell it to parts manufacturers to make parts used in Ford vehicles. Although some interactions could be done by email and telephone, the Court found that many required “good, old-fashioned interpersonal skills,” and resale buyers needed to be able to meet face to face with suppliers, parts manufacturers and Ford employees during core business hours.

Importantly, the Court reiterated the general rule is that regular attendance at work is essential to most jobs, especially interactive ones. It pointed to past court opinions as well as to EEOC regulations that support the premise that regular and predictable on-site attendance is an essential job function. The Court even relied on that “sometimes-forgotten guide” – common sense, stating that non-lawyers (as well as judges in other appellate circuits) recognize that regular in-person attendance is an essential function, and a prerequisite to other essential functions, of most jobs.

Other Buyers Telecommuted on a Predictable, Limited Basis

But what about the fact that Ford had a telecommuting policy that allowed other employees, including resale buyers like Harris, to work from home? Wouldn’t that make telecommuting a reasonable accommodation for Harris?

The Court said no, because she proposed to telecommute four days per week on a schedule of her choosing. The other resale buyers who telecommuted did so only one established day per week and they agreed in advance that they would come into work that day, if needed. They were also able to perform well and maintain productivity. Harris, on the other hand, wanted to be able to pick and choose which days she would telecommute, up to four days per week, without agreeing to come in those days, if necessary. The Court found that none of these other employees’ more predictable and more limited telecommuting schedules removed regular on-site attendance from the resale buyer’s job.

As a result, the Court ruled that Harris’ proposed telecommuting accommodation unreasonable.

In addition, Ford had allowed Harris to telecommute on an as-needed basis on three separate occasions and her performance suffered. Other attempts to improve Harris’ attendance also failed. The Court found that Harris could not perform the essential functions of her job and was unable to establish regular and consistent work hours. Therefore, it ruled that she was not a “qualified individual” under the ADA.

Technology Did Not Carry the Day

The EEOC argued that advances in technology make on-site attendance less essential. The Court disagreed in this case, stating that there was no evidence presented that specific technology made personal interactions unnecessary for resale buyers.

No Blind Deference to Employer’s Judgment

The Court made a point of stating that its opinion did not open the door for courts to blindly accept as essential whatever an employer says is essential for a particular job. It emphasized that an employer’s words, policies and practices were all important in deciding whether a particular task or requirement is an essential job function.

In Ford’s case, the evidence supported Ford’s judgment that regular and predictable in-person attendance was essential for resale buyers. The Court affirmed the district court’s grant of summary judgment in favor of Ford.

No Retaliation For Termination

The Court also ruled that Ford did not retaliate against Harris when it fired her for poor performance just four months after she had filed a charge of discrimination with the EEOC. Key was Ford’s good documentation of Harris’ performance and interpersonal issues. She had been ranked in the bottom 10% of her peer group before she filed her charge. Documentation showed that she failed to update spreadsheets, complete her paperwork, schedule training sessions, price items correctly and finish her work on time. Despite the closeness in time of the firing to her charge filing, the Court ruled that the EEOC failed to present evidence from which a reasonable jury could find that the real reason that Ford terminated Harris was unlawful retaliation instead of poor performance.

Dissent: Either Physical Presence is Not Essential or Telecommuting is A Reasonable Accommodation

Five judges on the Sixth Circuit dissented, believing that the EEOC had presented enough evidence to send the EEOC’s claims to a jury. Specifically, the dissent stated that the evidence was sufficient to show that there remained genuine disputes over whether Harris was a qualified individual, either because in-person attendance was not an essential function of her job, or because telecommuting would be a reasonable accommodation for her. It pointed to Ford’s telecommuting policy which allowed for “one to four days” of telework each week. It noted that Harris proposed that she be able to work from home up to four days each week, as was arguably allowed under the policy, not that she be permitted to telecommute four days each and every week.

The dissent also asserted that Harris’ past attendance issues that were a result of her disability should not be used against her in deciding whether a telecommuting arrangement during core business hours would be a reasonable accommodation under the ADA. Moreover, the dissent found that Ford should have engaged in a more interactive process to clarify Harris’ telecommuting accommodation request. Finally, the dissent believed that there was a genuine dispute over whether Ford retaliated against Harris for filing her discrimination charge.

Lessons for Employers Facing ADA Telecommuting Accommodation Requests

The majority’s decision finding that regular and predictable in-person attendance is an essential function of most jobs, especially interactive ones, is favorable for employers. But it does not mean that telecommuting can never be a reasonable accommodation. In fact, the dissent in this case demonstrates that telecommuting requests for disabled employees is likely to continue to be an issue with which employers will grapple in coming years.

If face-to-face interactions and in-person attendance at meetings or other work-related functions is essential for certain jobs at your workplace, be certain to include those tasks in your job descriptions. If you generally allow telecommuting, be sure to have a written policy and apply it consistently. If presented with a request to telecommute in order to accommodate a disability, engage in an interactive process to discuss whether telecommuting would be appropriate for that particular position and employee, whether it would constitute an undue hardship for your organization and if alternative accommodations would allow the employee to perform his or her essential functions. And by all means, make sure you have concrete documentation of an employee’s poor performance or policy infractions before taking adverse action against anyone who has filed a discrimination charge.

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February 16, 2015

Lessons From a $15M Discrimination Verdict

By Mark Wiletsky

A Colorado federal jury reportedly awarded $15 million last week to 11 workers who claimed they had been subject to workplace harassment, discrimination and retaliation because of their race and national origin. Ten of the 11 current and former workers who sued their employer, a trucking and mail-sorting company at Denver International Airport, were black men. Three had been born in the United States and the remaining seven were from Mali, Guinea and Brazil. Their allegations included that racist comments pervaded the workplace, that they were discriminated in work assignments, layoffs and pay and were segregated into certain unfavorable job categories and shifts, and that they faced retaliation after complaining about the harassment and discrimination.

Although we do not know exactly which facts or claims persuaded the jury to award this large sum, the fact that the jury awarded $13 million dollars for punitive damages suggests that it believed the company’s actions (or inactions) were particularly bad.

What can you learn from this significant discrimination verdict? Even if the verdict is later reversed or reduced, you can learn what not to do when managing a racially and ethnically diverse workforce.

Ignoring Complaints and Promoting the Harassers

The workers in this case alleged that they complained internally about racist comments and slurs made by supervisors, leads and co-workers and that nothing was done. Examples of some supposed comments directed toward the workers were “lazy, stupid Africans,” “go back to your f***ing country,” “they need to fire all the n***ers here” as well as regular use of the N-word. Instead of stopping the comments, management supposedly turned a deaf ear and even promoted some of those who made the slurs.

Don’t ignore inappropriate comments when you hear them. It is up to you to stop racial and ethnic slurs immediately and take action to ensure they are not pervasive in your workplace. If an employee complains about discriminatory name-calling and threats, you need to investigate the report and take appropriate action. Be sure to confirm—in writing—that you met with the accuser(s) to discuss the results of your investigation, and ensure there is no retaliation. Then follow-up again to ensure things have improved. Doing so will demonstrate your commitment to a workplace free from discrimination and harassment – so long as you are prepared to take action against those who violate your policies.

Failing to Enforce EEO and Harassment Policies

You likely have an Equal Employment Opportunity and a Harassment policy in your employee handbook, but they do no good if you fail to enforce them. Review your policies, train your supervisors on them and enforce them uniformly and consistently.

Retaliating Against Those Who Complain or Their Supporters

The eleventh worker who sued the trucking company in this case was a white man who offered support for the African workers and provided evidence supporting their allegations. After being terminated from his job, he alleged his firing was in retaliation for his support.

Retaliation is within company control and in many cases, is preventable. Train your supervisors not to treat an employee who has complained of discrimination or harassment, or who has participated in a charge or lawsuit, differently than other employees are treated. Carefully analyze any adverse decision that would affect such an employee and make sure your decision is based on legitimate business reasons and is well-documented, in case you have to defend a retaliation complaint.

Fifteen Million Reasons To Do It Right

You don’t want to end up in front of a jury defending your employment practices, but if you find yourself in that position, you want to be able to show a jury you did everything you could to prevent discrimination and harassment in your workplace. If you don’t take those actions, a jury may very well punish you for it.

September 23, 2014

Cheyenne Jury Awards $1,481,000+ On FMLA Retaliation Claim

By Brad Cave

The series of large verdicts for Wyoming employees seems to be marching forward. The most recent example occurred recently when a Cheyenne jury awarded over $740,000 to a trona miner after deciding that he was fired because he took FMLA leave. With liquidated damages available in an FMLA case, the Wyoming court entered judgment in an amount in excess of $1.48 million in favor of the employee. This case stands as yet another example about the importance of supervisor training and careful, well-documented and consistent decision making.

Long Term Employee With A Pain in the Neck. We first told you about this case in March of this year, when the Tenth Circuit Court of Appeals sent the case back to Wyoming for trial after reversing the trial court’s dismissal of the case. (Safety Violation or Too Much Intermittent FMLA Leave?). Here is a short recap of the facts.

Steven Smothers had been employed by Solvay Chemical for 18 years when his employment was terminated. Smothers had experienced back problems since 1994 resulting in three surgeries on his neck and other medical procedures, and an extended course of medical treatment by specialists. Over the years, Smothers took intermittent FMLA leave for his medical appointments and when he was unable to work due to the pain. The amount of FMLA leave he took did not go unnoticed. He was pressured by the production superintendent to change shifts to lessen the additional overtime cost caused by his absences, but such a change would have cost him about $7,000 per year in shift differential pay. Solvay also gave Smothers a negative rating on his performance evaluation because of his absences, and he was told that he was rejected for a promotion because of the leave.

Smothers’ Safety Rule Violation. In August 2008, Smothers and his coworkers were performing an acid wash, which Solvay did every six months to clean residual trona out of the equipment. When Smothers noticed that a damaged spool piece had caused a leak, he began to fix it without obtaining a line break permit which was required by Solvay safety rules. Smothers and a co-worker, Mahaffey, argued about whether the permit was necessary, and after Smothers removed the spool piece without first getting the permit, Mahaffey immediately reported Smothers’ actions to a supervisor.

Solvay terminated Smothers’ employment on August 28, 2008, based on a joint decision of six Solvay managers. Five of the six decision makers testified that the argument between Smothers and Mahaffey weighed heavily in the group’s decision to fire Smothers. Although the trial court originally dismissed the case, the Tenth Circuit believed that Smothers had presented enough evidence to create doubt about the real reasons for Smothers’ termination. So, the case was sent back to the trial court for trial.

What’s the Real Reason for Smothers’ termination? Like all retaliation cases, the jury in this trial was asked to decide whether Smothers was fired for a safety rule violation, as the employer contended, or because his employer retaliated against him for using intermittent FMLA leave or discriminated against him because of his disability. We don’t have a transcript of the trial, so we cannot tell you what evidence the jury heard or what facts persuaded the jury. We do know that the Tenth Circuit reasoned that the jury could disbelieve Solvay’s reasons because:

Supervisors criticized Smothers informally and in his performance evaluation for taking FMLA-protected leave, and rejected him for a promotion because of his time off;
Solvay did not give Smothers an opportunity to describe or explain his side of the argument with Mahaffey, even though the argument was a central reason for the decision to terminate Smothers’ employment;
Other Solvay employees who committed safety rule violations were not terminated.

And the Jury Returns.The jury found in favor of Smothers on his FMLA claim, and awarded Smothers the amount of $740,535 for his lost wages and benefits from the date of his termination, August 27, 2008, through the date of trial. But the potential damages don’t stop with the lost wages. Under the FMLA, the successful employee may be entitled to an additional amount equivalent to the jury’s award for liquidated damages – in other words, a penalty against the employer for the violation. As a result, the court has entered judgment against Solvay in the total amount of $1,481,070, twice the amount of the jury’s verdict, plus interest since the date of termination. The trial court declined to award Smothers any future lost wages. However, Smothers is entitled to an additional judgment for his reasonable attorneys’ fees and costs, which could add hundreds of thousands of dollars to the total.

Bottom Line. Regardless of the final number after adding prejudgment interest and attorneys’ fees, this is one of the largest judgments ever entered against a Wyoming employer. We cannot speculate about what evidence led the jury to its verdict, but we can share some lessons, with the benefit of twenty-twenty hindsight, that will help any employer avoid this kind of result:

Managers and supervisors must be trained and committed to the fact that taking FMLA leave is protected by federal law, and must not be the reason for formal criticism, denied opportunities, or informal complaining. FMLA-protected leave cannot be held against an employee for any reason whatsoever. Any comment or suggestion to the contrary can be used as evidence of pretext.
Investigations must be thorough and even-handed. While we don’t know all the evidence in this case, the jury may have heard that Solvay spent much more time asking Mahaffey about the argument with Smothers, while never asking Smothers for his side of the argument. Everybody should get the same opportunity to tell their side of the story. An inadequate investigation can be used as evidence of pretext.
Employees must be treated consistently. Smothers had evidence that other Solvay employees intentionally violated safety rules without being terminated. Employers need to mete out comparable discipline for comparable violations, or have a compelling reason why an employee gets tougher punishment.
Employers must respect long years of service. Of course, keeping a job for eighteen years does nothing to technically change the legal relationship or create any new rights or protection for the employee. But, after that length of time with a good performance record, it becomes difficult for a jury to believe that termination is an appropriate response for one incident.

Wyoming juries have delivered substantial employee verdicts over the last few years. Employers should pay attention.

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August 7, 2014

Favoritism to Paramour is Not Gender Discrimination

By Brad Cave

Friendship, cronyism, nepotism, affairs – many types of personal relationships may result in one employee being treated better than another employee. But is that favoritism discriminatory? Does the non-favored employee have a discrimination claim against the employer? No, Title VII does not prohibit favoritism based on a special relationship, says the Tenth Circuit Court of Appeals.

“I Like You Best”

If an employer pays the CFO’s sister a higher wage than other employees doing similar work, offers the most lucrative deals to an employee who is the boss’s best friend or gives playoff tickets as a bonus to the manager’s boyfriend who works at the company, that special treatment is permissible because it is based on the special relationship or bond between the parties, not on a protected characteristic. It is only when the differential treatment is based on an impermissible classification, such as gender, race or age, that it crosses the line into unlawful discrimination. In a recent decision, the Tenth Circuit Court of Appeals affirmed that distinction, ruling that a supervisor’s favoritism toward a female subordinate based on their purported intimate relationship did not amount to reverse gender discrimination against her male counterpart. Clark v. Cache Valley Elec. Co., No. 13-4119 (10th Cir. July 25, 2014).

Reverse Gender Discrimination Under Title VII

Project manager Kenyon Brady Clark sued his employer, Cache Valley Electric Company, alleging violations of Title VII. Clark’s discrimination claim alleged that his supervisor, Myron Perschon, favored a female project manager, Melissa Silver, over him because Perschon and Silver were in a romantic relationship. Clark asserted that Perschon gave Silver better work assignments, paid her more for performing less work and performed most of Silver’s job duties himself. Although it turned out that there had been no affair, Clark still asserted that “whether they were having sex or not, there was favoritism.” When asked about the reason for the favoritism at his deposition, Clark admitted that if the favoritism was not due to a romantic relationship, he did not know the reason for it.

The Court analyzed Clark’s claim as a reverse gender discrimination case under which Clark needed to show circumstances that would support an inference that his employer discriminates against the majority (i.e., males) or that “but for [his] status the challenged decision would not have occurred.” Significantly, Clark did not assert that the favoritism was due to Silver being a female or that Cache Valley treated women more favorably than men. Instead, Clark focused on the preferential treatment that his supervisor offered to one specific female employee. That deficit was fatal to his reverse gender discrimination claim. The Court cited numerous cases where the motives for preferential treatment were other special relationships, such as friendship, nepotism or personal fondness or intimacy, in which it had ruled that such favoritism was not within the purview of Title VII’s anti-discrimination provisions. Because Clark’s discrimination claim was based only on the favoritism shown to a special friend and not on a protected characteristic, his claim was not covered by Title VII. The Court affirmed summary judgment in favor of Cache Valley.

Retaliation Claim Fails Too

Clark also raised a retaliation claim in his lawsuit against Cache Valley. Clark asserted that his supervisor, Perschon, retaliated against him by trying to get a competitor to hire him, refusing to communicate with him and otherwise distancing himself from Clark. Clark also alleged that he was fired in retaliation for complaining about Perschon’s favoritism and retaliation. He had complained to management about the alleged affair between Perschon and Silver, stating that it was difficult to continually respond to vendors and suppliers who had questions about the purported relationship. He reported that they were acting like a married couple. He later complained about the preferential treatment that Silver received from Perschon, including receiving better job assignments and higher bonuses. In a letter to the company’s CEO and to human resources, Clark wrote that over the past three years, he had personally and professionally suffered serious and real adverse effects to his employment due to the alleged affair. He wrote that the affair created a hostile work environment and that it was the company’s responsibility to ensure that the workplace was free of harassment and retaliation. Shortly after meeting with HR and the company’s legal counsel to discuss his letter, Clark was terminated.

The Court rejected Clark’s retaliation claim. To make out a Title VII retaliation claim, Clark needed to show that (1) he engaged in protected opposition to discrimination, (2) a reasonable employee would have found the challenged action materially adverse, and (3) a causal connection existed between the protected activity and the materially adverse action. The Court concluded that Clark failed to show that he engaged in protected opposition to discrimination. He needed to show that he had a reasonable good-faith belief when he complained to the company that he was engaging in protected opposition to discrimination and that his good-faith belief was reasonable both subjectively and objectively. He failed to do so. Although he made statements about a “hostile work environment” and “discrimination” in his complaints to the company, the Court found such statements to be conclusory and not related to gender discrimination. The statements were about Perschon’s favoritism to Silver based on the alleged inappropriate relationship, which was not gender discrimination. Therefore, Clark’s retaliation claim failed.

Just ‘Cuz It’s Legal Doesn’t Make It Smart

Clark’s reverse discrimination claim was a little more cut and dried than most because he essentially admitted that the preferential treatment shown by his supervisor to a female colleague was not due to her status as a female. Consider whether the outcome would have been different had Clark provided evidence that the supervisor historically treated women better than men. Or think about other situations where special relationships result in favoritism, such as when the boss takes all his male cronies to play golf with clients while the female employees toil away at work. Even though the courts have been clear about distinguishing favoritism based on special relationships from discrimination based on a protected class, employers are wise to steer clear from favoring some employees over others, especially when it comes to pay, bonuses and benefits where the non-favored employees can prove financial harm. Keeping the terms and conditions of employment on an even footing will help keep your workplace productive, the morale of employees high and your company out of court.

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June 13, 2014

Forced “Onionhead” Practices At Work Result in EEOC Religious Discrimination Lawsuit

By Brad Cave

“I love you, man.” Appropriate for beer commercials but perhaps not for the workplace. A New York employer who allegedly required employees to participate in prayer circles, thank God for their job and say “I love you” to managers and co-workers faces a religious discrimination lawsuit filed recently by the Equal Employment Opportunity Commission (EEOC). The EEOC seeks compensatory and punitive damages on behalf of three employees who were fired, allegedly for opposing the required “Onionhead” practices, and a class of similarly harmed individuals. EEOC v. United Health Programs of America, No. 14-cv-3673 (E.D.N.Y. filed June 11, 2014).

Company Required “Harnessing Happiness” or “Onionhead” Practices

According to the EEOC complaint, three former employees of United Health Programs of America filed charges alleging religious discrimination in violation of Title VII because the company required employees to engage in practices under a belief system called “Harnessing Happiness” or “Onionhead.” According to the Harnessing Happiness website, Onionhead is an “incredibly pure, wise and adorable character” who “wants everyone to know how they feel and then know what to do with those feelings.” The three women claim that the company required them to participate in various Onionhead-related activities on a daily and weekly basis, including praying, reading spiritual texts, burning candles, keeping lights at work very dim, thanking God for their employment and saying “I love you” to colleagues and managers. They assert that every day, employees were asked to select Onionhead-related cards to keep next to their computers and to wear Onionhead-related pins. In addition, one of the company’s upper managers and the aunt of the company owner, “Denali,” was the leader of the Onionhead practices and allegedly would require employees to attend one-on-one sessions with her in order to read and discuss books about “divine plans,” “moral codes” and “enlightenment.”

Fired – Allegedly for Opposing Onionhead Practices

Each of the three Charging Parties, Elizabeth Ontaneda, Francine Pennisi and Faith Pabon, were allegedly fired for objecting to the Onionhead practices. Pennisi, an Account Manager and IT Project Manager, spoke up at a managers’ meeting in July 2010, stating that she was Catholic and did not want to participate in the Onionhead activities. Ontaneda, a Senior Accounting Manager for Customer Service, also spoke up at the meeting, saying she felt the same way. A few weeks later, both women were relocated to work in an open area on the customer service floor, rather than in their offices, and their duties were changed to require answering phones. Denali placed a large statue of Buddha in Pennisi’s empty office. Denali also spoke of “demons” in connection with Ontaneda’s and Pennisi’s resistance to Onionhead practices. The day after losing their offices, the women called in sick and were terminated by the company owner by phone and voicemail.

Pabon, a Customer Care Consultant, attended a spa weekend in Connecticut with Denali and about 20 other customer service employees. Pabon alleges that Denali stated that the purpose of the trip was spiritual enlightenment and that they were to be together at all times, holding hands, praying and chanting. Pabon refused to participate in some of the group activities and on Monday following the spa weekend, Denali fired Pabon for “insubordination.”

Hostile Work Environment, Failure to Accommodate and Retaliation

The EEOC asserts numerous religious discrimination claims against the company, including creating a hostile work environment based on religion, failure to accommodate the employees’ own religious beliefs or lack thereof, terminating employees based on religion and retaliating against employees for opposing the required Onionhead practices in the workplace. The EEOC also alleges that some employees were constructively discharged when they felt compelled to leave the company to avoid participating in the required Onionhead activities.

Reports suggest that the company denies any merit to the lawsuit and that they expect it to be dismissed. We don’t yet know the basis of their defense and must remember that at present, the allegations are unproven. It will be an interesting case to follow. We will keep you posted as it proceeds through the court

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May 6, 2014

Separation Agreements Targeted By EEOC Again

By Mark Wiletsky

The Equal Employment Opportunity Commission (EEOC) recently filed a lawsuit seeking to stop a Colorado employer from using its form separation and release agreement and to allow employees who have signed the form agreement to file charges of discrimination and participate in EEOC and state agency fair employment investigations. In its federal court complaint, the EEOC alleges that CollegeAmerica Denver violated the Age Discrimination in Employment Act (ADEA) by conditioning employees’ receipt of severance benefits on signing a separation and release agreement which, according to the EEOC, chills and interferes with the employees’ rights to file charges and/or cooperate with the EEOC and state fair employment practice agencies.

As we wrote on this blog earlier, the EEOC has been scrutinizing employers’ separation agreements. This is the second such lawsuit challenging language in the separation agreements that does not permit the filing of discrimination or retaliation charges with the EEOC or other government agencies. As in the EEOC’s earlier complaint against a national pharmacy, the recent complaint against CollegeAmerica Denver targets numerous provisions in the separation agreement, including the release of claims, a non-disparagement clause and provisions in which the employee represents that he/she has not filed any claims, has disclosed to the company all matters of non-compliance and will continue to cooperate with and assist the company with any investigation or litigation.

Many of the targeted provisions are standard clauses in form separation agreements. Although it remains to be seen whether the courts will agree with the EEOC’s claims, it is always a good idea for organizations to review their agreements and ensure they do not raise any red flags for the EEOC while still protecting the company from future payouts for employment-related claims. We will continue to provide updates as new developments arise.

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March 10, 2014

Safety Violation Or Too Much Intermittent FMLA Leave? Tenth Circuit Says Jury Must Decide Wyoming Employee’s FMLA and ADA Case

By Brad Cave

Did Solvay Chemicals fire long-time employee Steven Smothers because of a first-time safety violation or because the company was tired of his frequent absences due to an ongoing medical disability? The Tenth Circuit Court of Appeals recently ruled that Smothers provided sufficient evidence to suggest that Solvay’s stated reason for his termination was pretextual, allowing his claims for unlawful retaliation under the Family and Medical Leave Act (FMLA) and discrimination under the Americans with Disabilities Act (ADA) to proceed. Smothers v. Solvay Chem., Inc., No. 12-8013 (Jan. 21, 2014). The Court affirmed the grant of summary judgment on his state law claim for breach of an implied employment contract.

Medical Treatments and Severe Pain Lead to Frequent FMLA-Protected Absences

For eighteen years, Smothers worked as a surface maintenance mechanic in Solvay’s trona mine in Sweetwater County, Wyoming. The company considered him to be an excellent mechanic who did great work and got along with everyone. In 1994, Smothers injured his neck and developed degenerative disc disease in his spine. Over the next five years, Smothers had three surgeries to his neck as well as numerous other medical procedures. Despite treatment by a specialist, Smothers continued to have severe ongoing neck pain, severe migraine headaches and lower back problems. At times, Smothers was unable to work without pain treatments and he often was able to sleep only a few hours each night due to the pain.

Smothers asked for and was granted FMLA leave for intermittent absences caused by his condition. Managers and co-workers began to complain about his absenteeism, especially because he worked on the graveyard shift where there were fewer workers to absorb his absences resulting in increased overtime costs. Solvay’s production superintendent Melvin Wallendorf pressured Smothers to change to the day shift, but Smothers refused as the shift change would have cost him about $7,000 a year. Solvay’s human resources department advised Wallendorf that urging Smothers to switch shifts would violate the FMLA so Wallendorf stopped pressuring Smothers but did not stop complaining about his absences.

At one point, Wallendorf and Rick Wehrle, Smothers’ direct supervisor, gave Smothers a poor performance rating on his evaluation due to his absenteeism. In 2005 or 2006, Smothers applied for a promotion but was told that he was rejected because of his absences.

Safety Issue Explodes into Argument

In 2008, the graveyard crew conducted a routine maintenance acid wash to remove build up in its equipment. After a line ruptured, Smothers saw that a damaged “spool piece” had caused the problem and prepared to remove it. Another mechanic, Dan Mahaffey, suggested that Smothers wait for a line break permit, which is a form that certifies that employees have completed a checklist of precautions before a line can be safely disconnected. Smothers said that a permit wasn’t required because the line was already broken. Mahaffey and Smothers then argued. Mahaffey offered help on the repair which Smothers refused. Mahaffey took offense and accused Smothers of hypocrisy since Smothers had previously reported others for safety violations. Smothers made an offensive comment to Mahaffey and told him he did not want his kind of help. Smothers removed the broken piece and began the repair.

Mahaffey immediately reported the argument and Smothers’ removal of the spool piece without a line break permit to the area supervisor. Later that same day, three managers called Smothers in to discuss the safety violation. Although completing the line break permit may not have been absolutely necessary, Smothers later conceded that he should have locked out the pump valve before removing the part according to Solvay’s safety policies. Smothers apologized for not locking the pump valve before removing the piece and promised it wouldn’t happen again. Smothers was sent home pending an investigation.

Six managers were involved in deciding what to do about the argument and the safety violation. Three of the managers personally talked with Mahaffey about the argument but no one spoke to Smothers about it. About eight days later, Solvay fired Smothers. Smothers sued in Wyoming federal court, alleging, among other claims, unlawful FMLA retaliation, ADA discrimination and breach of an implied employment contract based on Solvay’s employee handbook.

FMLA Claim Bolstered By Disparate Treatment and Previous Retaliatory Acts

The trial court granted summary judgment to Solvay on Smothers’ FMLA and ADA claims. On appeal, the Tenth Circuit decided that Smothers presented enough evidence for a trial about whether Solvay’s real reason for his termination was his use of FMLA leave or his disability. Smothers provided evidence that other employees who committed similar safety violations were not fired. Five of the six decision-makers who fired Smothers were also involved in at least one decision in which a similarly situated employee was treated more favorably after violating the same or comparable safety rules. Smothers also pointed to the negative comments, negative performance rating, failure to promote and pressure to change shifts because of his FMLA-protected absences as evidence that the safety violation was a pretext for firing him for his FMLA leave. Moreover, Smothers showed that the decision-makers had failed to sufficiently investigate the argument he had with Mahaffey, basing their decision almost entirely on Mahaffey’s version of events. The Court decided that a reasonable jury could find that Solvay’s investigation into the quarrel was not fair or adequate. Based on this evidence, the Court found that there were issues of fact on whether Solvay’s termination reasons were pretextual and reversed the dismissal of Smothers’ FMLA retaliation claim.

Smothers Was Disabled Under ADA

Smothers also asserted that his firing was in violation of the ADA. He presented evidence that his medical condition was an impairment that substantially limited a major life activity, specifically his ability to sleep. Because the facts would allow a reasonable jury to conclude that Smothers’ sleep was substantially limited, Smothers satisfied his burden of establishing a prima facie case of disability discrimination. As with the FMLA claim, the Court found sufficient evidence that Solvay’s stated termination reasons may have been a pretext for disability discrimination. Therefore, the Court reversed the dismissal of Smothers’ ADA claim as well.

No Breach of Implied Contract Based on Employee Handbook

Smothers also alleged that Solvay violated the terms of its employee handbook, giving rise to a claim for breach of implied contract under Wyoming law. The Court disagreed. Wyoming recognizes a claim for breach of implied contract if an employer fails to follow its own required procedures, such as the procedures laid out in an employee handbook. Solvay’s handbook contained a four-step progressive disciplinary process, with termination as the last step. But it also contained a provision that allowed Solvay to terminate an employee immediately for a serious offense, including a safety violation. Because the discipline policy unambiguously gave Solvay the discretion to fire employees who violate safety rules, the Court found that Solvay’s decision to terminate Smothers for violating a safety rule did not violate the terms of the employee handbook. Therefore, the appeals court upheld the trial court’s dismissal of Smothers’ breach of implied contract claim.

Back To Court They Go

We don’t know whether Smothers or Solvay will prevail if this case goes to trial but we do know that the appellate court thought that some of the evidence about the actions of Solvay managers could demonstrate that Solvay acted with a discriminatory motive:

Supervisors and co-workers gave Smothers a hard time about taking FMLA-protected leave.
Solvay failed to properly investigate all sides in the quarrel, accepting one employee’s version of events as fact.
The decision-makers treated Smothers more harshly than other similarly-situated employees who had violated similar safety rules.
Managers and supervisors considered Smothers’ FMLA absences when providing his performance evaluation and rejecting him for a promotion.

Evidence of these actions prevented Solvay from obtaining a grant of summary judgment on appeal. While Solvay may dispute Smothers’ evidence when the case actually goes to trial, this case stands as a lesson about the kinds of supervisory comments and actions that can feed into a discrimination claim, and a good reminder of how carefully employers must manage employees with injuries or disabilities.

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