Moline firefighter suspended for responding drunk to deadly fire

Posted 5:03 PM by Michael Fox

The headline doesn't really tell it all, as the drunk firefighter actually drove a firetruck to the fire. You can read the story from the WQAD websitehere, but the kicker is in this quote (my emphasis added):

''Was the fireman legally drunk? Yes. We did a breath test and found the individual was impaired beyond the legal limit.'' The firefighter is suspended--and may lose his job.

MAY LOSE HIS JOB? Well actually, the manager is actually doing what he should be doing, not telling the media, letting him tell his side of the story etc. Everything that every management labor lawyer would counsel. But don't you ever stop and wonder that this is what the world has come to?

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Now Ex-City Attorney Apparently Unhappy With Withholding On Severance Pay

Posted 4:56 PM by Michael Fox

Although the City of Lodi honored its commitment to pay 6 months severance following his termination, the former City Attorney was unhappy that taxes were withheld, and has filed a claim. Quoted in the Lodi News-Sentinelstory the City Manager said, ""We also called our attorneys and the IRS, and all three said we have to withhold taxes. I'm not doing it to annoy him. I'm doing it because it's the law." But if he got a small chuckle out of annoying him, he would not be the first employer to have smiled at least inwardly when it happened.

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Talk About A Narrow Miss - Alleged Identity Thief Hired (For 6 Hours) As Assistant to HR Director

Posted 4:43 PM by Michael Fox

The sort of thing that would not make your day as an HR Director, to find your newly hired assistant, who would have access to employee and client's personal information had been convicted of misdemeanor impersonation of others. According to the Joplin Globestory that is what happened to the Economic Security Corp. office in Joplin. The good news is, after six hours on her first day when various questions were raised that could not be answered she was let go, before having access to any information. The really scary part, it was not background checking which caused the questions, but another employee spotting her and raising questions about her dealings with an organization unrelated to the employer.

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Saturday, February 28, 2004

Discovery And Delay In Raising Arbitration Agreement? Still No Waiver

Posted 3:42 PM by Michael Fox

At least according to a Texas Court of Appeal. The key to waiver is harm to plaintiff, and in this case that was not shown even though there had been a motion to transfer venue and discovery by both sides, as well as a period of time before the arbitration agreement was raised. Noting the Texas Supreme Court's strong presumption against waiver, the court granted mandamus under the FAA. In Re Granite Construction Co. (Tx. App. - Beaumont 2/26/04).

There was a dissent, but it was over the procedural issue of whether the arbitration should be compelled under the FAA via mandamus, or under the TAA pursuant to appeal. Justice Burgess, continues his argument for a more restrictive view of the FAA that he began unsuccessfully in In Re Nasr, 50 S.W.3d 23 (Tex. App. - Beaumont 2001).

Labels: arbitration

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Who Needs The New White Collar Regs? Allstate Establishes Administrative Exemption

Posted 2:46 PM by Michael Fox

In a huge opt-in class action involving 2,300 Neighborhood Office Agents, the district court ordered 6 plaintiffs to be test case. After discovery, the company established the administrative exemption on summary judgment. The district court granted summary judgment not only to the test 6, but on the rest of the class as well. On appeal, the court upheld the summary judgment on the basic issue of the administrative exemption. Hogan v. Allstate Insurance Company (11th Cir. 2/27/04) [pdf]. In what should be a mostly temporary setback, the Court found that the application of the summary judgment to the remainder of the class was not appropriate since they had not received notice under Rule 56(c). Although you don't have to go back any further than a certain foul ball in the Cubs v. Marlins national league championship game to know the danger of giving anyone a second chance, still Allstate has to feel it is in pretty good hands at this point.

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Maybe This Is Why Minor League Baseball Has Become So Popular, Not

Posted 1:05 PM by Michael Fox

For one of the more bizarre sexual harassment cases that I can remember having seen, or if you happen to be a fan of the Salt Lake Stingers, a AAA club in the Pacific Coast League, formerly known as the Buzz, you should check out Alwine v. Buzas (10th Cir. 2/27/04). The suit brought by a female applicant for the position of -- well that was part of the issue apparently -- she thought she was applying for a general manager's position, whereas the owner of the Buzz thought she was applying for "Tammy's job", which was an apparent reference to the former General Manager's job, and at least in the mind of the owner of the Buzz, may have included more than baseball duties.

There are no highlights of what seems (solely from a reading of this opinion) to be a poster child for those who feel that the legal system is losing touch with reality when extensive time and energy are spent on such matters, when what really is appropriate is "a plague on both your houses." It reminds me of a case recently where I interviewed a "non-partisan" witness who candidly said, if it was possible he hoped both sides would lose. Although not a highlight, one interesting question that could have been raised, but was not and so was not decided, was whether a hostile environment claim can be based on conduct during an interview? Perhaps the reason was that it was not raised was that the interviews, were to say the least not the usual job interview.

If you are just interested in outcomes, the Buzz won both the trial and the appeal. (Better than they did against Buzz Tech, see the Georgia Tech press release on their trademark victory over the Buzz.) While the conduct that seems to have happened, which is most aptly described as of a "dirty old man" nature, is not to be condoned, surely there are better ways to deal with it than expending the resources and the credibility of the legal system.

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Friday, February 27, 2004

Who Is A Supervisor Under Faragher/Ellerth? More Questions?

Posted 6:55 PM by Michael Fox

The 7th Circuit addresses again the question of who is a supervisor for purposes of strict liability under Faragher/Ellerth. Noting "supervisor" to be a legal term of art for Title VII purposes, it finds an employee "merely having authority to oversee aspects of another employee's job performance does not qualify as a supervisor in the Title VII context." Rhodes v. Illinois Dept. of Transportation (7th Cir. 2/26/04) [pdf].

Although agreeing that the Court had correctly applied its precedent, Judge Rovner in his concurring opinion suggested it was time the Circuit consider its position:

The standard that this circuit has established has the allure of drawing a bright line between those who have the power to make formal employment decisions and those who do not. But it excludes from the category of supervisor those employees who, although lacking final authority to hire, fire, promote, demote, or transfer the plaintiff, nonetheless enjoy substantial authority over the plaintiff’s day-to-day work life. To that extent, it is a standard that arguably does not comport with the realities of the workplace. And to the extent that employers with multiple worksites vest the managers of such sites with substantial authority and discretion to run them but reserve formal employment authority to a few individuals at central headquarters, our standard may have the practical, if unintended, effect of insulating employers from liability for harassment perpetrated by their managers.

Considering not only Judge Rovner's view, but his summary of the view from other circuits, and having responded to just such a question today, I have a feeling this is not the last that we will hear of this question.

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It's Groundhog Day All Over Again - Pennsylvania Jury Awards 3.2 Million Against Fed Ex

Posted 9:50 AM by Michael Fox

One thing can be safely predicted -- Federal Express is unlikely to agree to try a sexual harassment case in Pennsylvania in February 2005, given the results in 2004 and 2003. The York Daily Record story explains the $3.2 million dollar award to former employee Marion Shaub earlier this week. Although losing her gender discrimination claim, she prevailed on retaliation and hostile environment. Among other things as the only female tractor-trailer driver at the Harrisburg Airport facility she claimed that her "brakes were loosened, the brake lines were cut and the lines were filled with dirt," although she never was involved in an accident where property or personal injuries were sustained.

In February 2003, Fed Ex suffered a $2.3 million verdict in a case brought by a former supervisor that I noted here. That case settled for a confidential amount on appeal.

Labels: MDV

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Tuesday, February 24, 2004

Post Termination Conduct - Can Impact Front Pay and Reinstatement

Posted 9:13 PM by Michael Fox

In Sellers v. Mineta (8th Cir. 2/24/04) [pdf] the Court faced an unusual set of circumstances. Sellers who alleged she had been wrongfully terminated was subsequently terminated from her next employer for misconduct. This was arguably sufficient to prevent re-instatement with defendant. The question became the impact on her ability to receive front pay if that were established. Although sending it back to the court below for further factual development, the Court summed up its theoretical view in this money quote:

It requires no leap in logic to conclude that if an unreasonable rejection of an offer of reinstatement precludes a front pay award, then post-termination misconduct of a type that renders an employee actually unable to be reinstated or ineligible for reinstatement should also be one of the "factual permutations" which is relevant in determining whether a front pay award is appropriate.

Although there is a dissent, it seems to go only to whether the facts of this case call for the application of this principle, rather than disagreeing with the principle as a matter of law.

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Million Dollar Judgment Goes Up In Smoke - Failure to Allow Use of EEOC Charge For Cross Examination

Posted 9:00 PM by Michael Fox

It is rare that an evidentiary ruling by a court is the basis for reversing a jury's verdict as the reviewing court must find both abuse of discretion and that it affects a substantial right of the objecting party. In Weyers v. Lear Operations Corp. (8th Cir. 02/24/04) [pdf] the defendant overcame both obstacles. Plaintiff's credibility was critical in this hotly contested litigation and the district court's refusal to allow the defendant to cross examine the plaintiff by using her EEOC charge and questionnaire was enough to merit reversal of the favorable judgment below. It was particularly compelling since at trial she testified to a number of events before January 3, but in her charge filed 18 months earlier, she had only mentioned one incident before that date.

Adding insult to injury, the Court also ruled that the individual who plaintiff alleged was responsible for harassment was not a supervisor, as that term is used in terms of applying the Faragher/Ellerth affirmative defense. The Court applied the narrow standard established by another panel of the 8th Circuit earlier this year, "the alleged harasser must have had the power (not necessarily exercised) to take tangible employment action against the victim, such as the authority to hire, fire, promote, or reassign to significantly different duties.”

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7th Cir. Parses Summary Judgment Evidence To Find No Evidence of Discrimination Because of Sex

Posted 8:42 PM by Michael Fox

The Court begins by reiterating what is required to establish intentional sex discrimination -- evidence that would allow a reasonable jury to infer that plaintiff was terminated because of his sex. And although there was much evidence of perceived anti-male talk, the 7th Circuit's careful parsing of those statements to see what they really mean, leaves the plaintiff coming up short and the court affirming summary judgment. Steinhauer v. DeGolier (7th Cir. 2/24/04) [pdf]. If you want a model for careful examination of language, you would be hard pressed to find a better example.

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Supreme Court - No Reverse Discrimination Under the Age Act

Posted 10:58 AM by Michael Fox

Today's decision in General Dynamics v. Cline (U.S. 2/24/04) [pdf] makes the common sense ruling that the age discrimination does not prohibit actions that favor those over 50, even when challenged by fellow boomers who are between 40 and 50. Although noting that there could be a reading which would support the younger plaintiffs claiming they had been discriminated against because of their "protected age" the money quote from Justice Souter does not buy such a reading:

In the abstract, the phrase is open to an argument for a broader construction, since reference to “age” carries no express modifier and the word could be read to look two ways. This more expansive possible understanding does not, however, square with the natural reading of the whole provision prohibiting discrimination, and in fact Congress’s interpretive clues speak almost unanimously to an understanding of discrimination as directed against workers who are older than the ones getting treated better."

The most important aspect of the case is that it was a train wreck that was avoided, although three of the justices would have let the crash occur, founded on the literal wording of the statute. As I had predicted, it was Justice Thomas who led the way in this regard:

This should have been an easy case. The plain language of 29 U. S. C. Â§623(a)(1) mandates a particular outcome: that the respondents are able to sue for discrimination against them in favor of older workers. The agency charged with enforcing the statute has adopted a regulation and issued an opinion as an adjudicator, both of which adopt this natural interpretation of the provision. And the only portion of legislative history relevant to the question before us is consistent with this outcome. Despite the fact that these traditional tools of statutory interpretation lead inexorably to the conclusion that respondents can state a claim for discrimination against the relatively young, the Court, apparently disappointed by this result, today adopts a different interpretation. In doing so, the Court, of necessity, creates a new tool of statutory interpretation, and then proceeds to give this newly created “social history” analysis dispositive weight. Because I cannot agree with the Court’s new approach to interpreting anti-discrimination statutes, I respectfully dissent.

We also had the unusual specter of Justice Scalia arguing contrary to the majority that the EEOC's view of the ADEA was proper.

This is a difficult case for those, like me, who believe that judicial activism as that term is frequently used is not a good thing, but who also squirm at the thought of a different outcome than the one obtained by the majority in this case.

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Monday, February 23, 2004

Buyer Beware - 3rd Circuit Provides Lesson In Successorship Liability in Title VII Case

Posted 9:51 PM by Michael Fox

In a 2-1 decision the 3rd Circuit untangles a procedural mess and revives a claim of discrimination that looked hopeless. The basic facts of Brzozowski v. Correctional Physician Services, Inc. (3rd Cir. 2/23/04) [pdf] are that Mrs. B. was employed by Correctional which provided medical services for various prisons. Mrs. B. filed a Title VII claim for discrimination against Correctional, suing within 90 days of the receipt of a right to sue letter. Unknown to her, Correctional was failing financially. She found out when its Counsel moved to withdraw for failure to get paid. By that time, Correctional had sold its assets, which consisted mainly of contracts with various states to Prison Health Services.

Mrs. B. sought to add Prison as a successor to Correctional, but the district court refused. Thereafter Mrs. B and Correctional entered into an agreed judgment for $150,000 with an agreement that the plaintiff would not seek to enforce the judgment against any of the individuals who had owned Correctional.

The 3rd Circuit first determined that it had jurisdiction, and then determined under the expanded rule of successor liability applicable in employment and labor cases, that Prison was in fact a successor. It also held that Mrs. B's attempt to add Prison related back to the timely filed action against Correctional. In at least one break, the majority held that Prison was not bound by the agreed judgment, and was entitled to defend itself on the merits.

The dissent, noting that the question is basically one of equity, would have applied the principle of a 7th Circuit decision distinguished by the majority, Musikiwamba v. Essi, Inc.,760 F.2d 740 (7th Cir. 1985). It held that while an employee should not lose rights because of a sale, neither should an employee be placed in a better position. Here, since Correctional was essentially judgment proof, by making the deep pocket of Prison available, Mrs. B.'s position was much better than it would have been against her employer.

The important lesson for those purchasing a business, even asset transactions, is to always be aware of the potentially broad reach of successorship liability.

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West Virginia Court Sends Male Obstetrical Nurse Case Back to Trial Court

Posted 12:17 PM by Michael Fox

Brian Peterson's Legal Weblog has the link and a good discussion of what the West Virginia Supreme Court reuires to establish a bona fide occupational qualification defense in a sex based discrimination case, where gender is the issue. Here, the hospital won summary judgment that being female was a bfoq for being an obstretical nurse. As Brian explains the court reversed and sent it back with directions on what was needed to establish the defense.

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Differing Views On Arbitration

Posted 10:09 AM by Michael Fox

The most important point in this article from the Minneapolis/St. Paul Business Journal is that arbitration is not a "one size, fits all" solution, but then very few things are.

Labels: arbitration

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GLBT - A View From Inside the Austin Work World

Posted 9:21 AM by Michael Fox

Melissa Gaskill's article in the Austin Business Journal takes a look at what it is like to be gay in the Austin workplace. Or, to be more precise using the new acronym, gay, lesbian, bisexual or transgendered. Although the headline is somewhat negative (Gay, lesbian workers walk fine line at jobs), the general tenor of the article is that Austin is a good place to be. Interesting that there is no mention of the Austin ordinance which prohibits workplace discrimination based on sexual orientation. Since it is somewhat toothless, it may not be a fair comparison to what a modification to Title VII or the TCHRA would do, but it does show that attitude and market forces, not just laws, can be an effective force for change.

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Saturday, February 21, 2004

Age Is Motivating Factor, But Employer Prevails On Affirmative Defense, No Attorneys Fees

Posted 1:38 PM by Michael Fox

One of the fears of employers after the Supreme Court decision in Desert Palace v. Costa was that plaintiffs would be entitled to attorneys fees if they took a mixed motive case to trial and won on the question of a motivating issue, notwithstanding the employer might prevail on the affirmative defense that they would have taken the same action. Although not dealing with federal law, Burgmann Seals America, Inc. v. Cadenhead (Tex. App. - Houston [1st] 2/19/04) [pdf] rules that out for TCHRA claims. Cadenhead convinced the jury that age had been a motivating factor in his not being promoted to President of the company, but the jury also found the company would have taken the same action anyway. The trial court used those findings to support an award of attorneys and expert witness fees. Relying on the Texas Supreme Court decision of Southwestern Bell Mobile Systems, Inc. v. Franco , the Court reversed and rendered since plaintiff did not recover any meaningful relief for his age claim.

If the same holds true for motivating factor cases under federal law, it will be great for employers; even if not, it will be another drawback to plaintiffs filing under the TCHRA and keeping venue in the state courts, as opposed to filing under Title VII thus permitting the case to be removed to federal courts. Either way, employers seems destined to get some benefit.

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Friday, February 20, 2004

5th Circuit Gives EEOC A Victory In Unpublished Opinion - Thoughts On Proposed FRAP 32.1

Posted 9:09 AM by Michael Fox

In the ongoing debate over whether the appellate rules should be changed to allow citation to unpublished opinions, see Howard Bashman's ongoing discussion of this issue at How Appealing, a case like EEOC v. Dunbar Diagnostic Services (5th Cir. 2/19/04) [pdf] gives me pause about my general view that doing away with non-published opinions would be a good thing. (That actually is not what the proposed rule would do, it would allow cases to be unpublished or marked non-precedential, but would allow citation to them.) My concern is that with little elaboration, what would generally be considered a conservative panel of the 5th Circuit, Jolly, Higginbotham and DeMoss, overturned the trial court's grant of a Motion for Judgment As A Matter of Law. It is not the overturning which seems improper, but the lack of explanation and the use of language which I could see hurled back at defendant's in the future, that I think simplifies at best, if not incorrectly states, what the 5th Circuit's law really is.

First, there is no explanation at what stage of the case the Motion had been granted or whether it was a jury or non-jury trial. My guess is that it could have been done even before trial, which would explain somewhat the Court's fairly obvious disdain for the proceeding below. That would seem to be improper under the rules, but if that were true surely should have been mentioned. Rather than go into what else had been shown, the Court applys Reeves ruthlessly saying only the EEOC met the "minimal burden" of a prima facie case and the reason for her termination given by the employer was false (based on the standard used by the 5th Circuit for such cases, "the court must review the record as a whole, draw all reasonable inferences in favor of the nonmoving party and do so without weighing the evidence or making credibility determinations.") Therefore, the JMOL was wrong. Clearly there are cases where a prima facie case is made and there is some evidence of falsity, when the court has upheld a JMOL, but you would not know it from this decision.

Given that the district court had also awarded attorneys fees against the EEOC, which although not unheard of is still relatively rare, it seems obvious something else was going on, and the 5th Circuit felt the need to just send it back and keep the case moving. But in doing so, it doesn't seem the full story was given. In these circumstances, making it non-precedential served its purpose well. Could it have been dressed up enough and given enough attention to cure these concerns? Almost certainly. Is it worth the time and effort? I suppose that is what the debate is all about.

Update: According to the Houston Chronicle story, it was a jury trial that was short circuited by Judge Hughes' ruling.

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Thursday, February 19, 2004

Where There's Smoke, There's Not Always Fire - Wal-Mart Prevails In Wage and Hour Trial

Posted 11:28 AM by Michael Fox

Having lost the liability phase on whether employees were forced to work overtime off the clock, Wal-Mart fared much better the second time around, when the focus was on each individual's claim. Of the 108 claimants, 24 were denied any recovery and the remaining 84 were able to establish only 700 hours collectively. Although the court has ordered the parties to try to stipulate to an hourly rate, even at $10 an hour the overtime award would be just over $10,000 total. Even doubling it because of liquidated damages, would give a paltry sum for the amount of energy that has been expended. It will be interesting to see what the court awards plaintiffs' counsel in attorneys fees. If tied to the result, which is one factor to be considered, it could be relatively minimal.

Although the story in the Oregonian is headlined, "Jury says Wal-Mart must pay overtime," the real story is the impact that this case may have in the future. Being willing to shell out what must have been a substantial sum for its own attorneys fees and the time of its executives, may ultimately pay substantial dividends in the form of cases not brought in the future. It may also encourage other employers with the resources to fight rather than roll over.

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Pro Se Sarbanes Oxley Claimant Prevails Before ALJ

Posted 11:01 AM by Michael Fox

Although many, including me, had anticipated that precious few Sarbanes Oxley claims would ultimately be heard by ALJ's because of the option for plaintiffs to opt to go to federal court after 180 days, a record of plaintiff successes before ALJ's may change that perception. In this case, a pro se research analyst, Margot Getman, convinced the ALJ that she had been terminated in violation of Sarbanes Oxley. Getman v. Southwest Securities, Inc.2003-SOX-8 (ALJ 2/2/04). According to the ALJ, "The strongest support for Complainant's claim that her protected activity was the proximate cause of her termination is Respondent's general dishonesty regarding a number of the key issues found in this matter." (emphasis added) Among the issues were back dated documentation of her performance, which apparently was not disclosed to the OSHA investigator and a misstatement of the reason for her termination on the required U-5. An act the employer characterized as charitable in nature to her, and the ALJ found to be an admission of intentional submission of inaccurate documents to securities regulators and a possible violation of securities laws. Ouch!

Although the decision has apparently escaped the commercial press, today's Daily Labor Report (BNA, paid subscription required) picked it up. Although no doubt Getman is basking in the award of approximately $175,000, I would assume her claim against the Dallas based firm will still be subjected to review by both the Administrative Review Board, and ultimately the 5th Circuit. The 'whistleblowing' in this case seems somewhat novel, as it is based on a stock report that ended up never being published, because of the rating that she gave the stock. Given the strong anti-credibility findings of the ALJ, my guess is that the appeals will focus on whether or not the act was in fact the type of activity protected by Sarbanes-Oxley.

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Tuesday, February 17, 2004

Important Post Faragher/Ellerth Question - Who Is A Supervisor For Purposes of Strict Liability

Posted 6:03 PM by Michael Fox

The consequences of supervisory harassment on the basis of a prohibited category were made more serious by the Faragher/Ellerth decisions of the Supreme Court. If the harasser is a supervisor there is strict liability, subject only to an affirmative defense, available only if there is no tangible job action. One question not specifically answered is how broadly "supervisor" will be construed. The language in Faragher is "a supervisor with immediate (or successively higher) authority over the employee." The 7th Circuit provides its answer in a racial harassment case where it succinctly summarized the facts as follows:

Worthington has employed Hrobowski, a black man, since 1976. Since January 30, 1997, Hrobowski has been Worthington’s director of safety and health, although he has been on medical leave since April 2, 1999. According to the district court, Hrobowski put forth the following evidence to support his claim of a hostile environment: “(1) Maintenance department employees used racial epithets [especially the word ‘nigger’] frequently; (2) a co-employee made an inappropriate comment about property values decreasing when blacks move in; and (3) co-supervisors would tell [Hrobowski] that he needed to ‘talk some nigger to nigger’ with an employee.”

Hrobowski v. Worthington Steel Company (7th Cir. 2/17/04) [pdf].

Not too surprisingly the Court found that plaintiff had met all the basic elements of a harassment claim, yet it affirmed the district court's grant of summary judgment for the employer. The key was which standard of liability was applicable to the company - the strict liability standard of Faragher/Ellerth or the negligence standard applicable when it is harassment by someone other than a supervisor. The key to the decision is how the 7th Circuit defined supervisor:

For there to be an issue of material fact as to whether a supervisor harassed Hrobowski, it is not enough that he point to evidence that just anybody with managerial authority was racially abusive; instead, Hrobowski must show that the harasser was his supervisor. Id. A supervisor is someone with the power to affect the terms and conditions of the plaintiff’s employment. Id. at 1034. In his opening brief, Hrobowski devotes substantial effort to proving that “managerial employees at Worthington directed offensive comments to him.” But he never points to evidence that a particular person with the power to influence the terms and conditions of his employment made such remarks.

Given that the court could find no factual dispute under the negligence standard, the summary judgment was affirmed.

Although this is a certainly a common sense ruling on the scope of Faragher/Ellerth it is interesting that the Court did not cite to either opinion. Some would argue that the language quoted above from Faragher could
be interpreted much broader, to encompass anyone who ranks higher than the individual in question, rather than someone who has direct authority over them. Although the record is much less than clear, it appears that he may complained to the plant manager, although his place in the company hierarchy is not defined. However, if there had been a strong argument for a broader reading, it is hard to believe that it would not have been found by Judge Diane P. Wood who did not dissent. If there were a valid argument for a broader reading of supervisor, given both Judge Wood's intellect and predilection to protect the interests of employees, no doubt it would have been raised.

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Monday, February 16, 2004

5th Circuit - Pretext Plus Does Live For TCHRA Claims

Posted 2:30 PM by Michael Fox

Or at least that is how I read a surprising reversal of an earlier outcome in Pineda v. United Parcel Service, Inc. (5th Cir. 2/16/04) [pdf]. Although less than six weeks ago the 5th Circuit affirmed a jury verdict in Pineda's favor, today it grants rehearing and reverses and renders in favor of UPS. What was the magic bullet that turned the case around? The Texas Supreme Court decision in Canchola v. Wal-Mart, which I reported on here last September.

The money quote from the 5th Circuit is found in footnote 8:

Although the Texas Supreme Court based its conclusions in Canchola on its interpretation of the Supreme Court’s decision in Reeves v. Sanderson, 530 U.S. 133, 120 S. Ct. 2097 (2000), it did so for purposes of the TCHRA only. As only Texas law is implicated in this case, we do not consider whether the Texas Supreme Court correctly interpreted Reeves. Further, our ruling in this case should not be interpreted as an adoption of Canchola for purposes of federal civil rights law.

In short, don't think pretext plus lives under Title VII, but bring your case under the TCHR in federal court, and be prepared to establish more than just pretext.

Pineda turns out to be a double victory for employers, it re-affirms pretext plus for TCHR claims and it limits the employer hostile Quantum holding that motivating factor is the applicable standard to substantive discrimination claims, while applying the less employee friendly 'but for' test to retaliation claims.

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Sunday, February 15, 2004

This Is What You Were Afraid They Were Doing With The Company T-1

Posted 10:34 PM by Michael Fox

But now here's some evidence to back up what you thought was happening: Workplace Internet Full of Porn, Blogs and Dating.

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Picking A Jury in the Age of Tort Reform

Posted 10:05 PM by Michael Fox

Although not an employment case, this Houston Chronicle story on the large number of potential jurors who were disqualified because of their negative views of lawsuits (and often lawyers) points up a growing reality. Although it can make jury selection more difficult, it is ultimately good to have truly deeply held views aired. One of my pet peeves however is those jurors, who air views not so much because they are deeply held, but because they sense (often correctly) that the adamant statement of them is likely to lead to their not being selected. Often it seems it is those jurors who most often would add (from an employer's perspective) balance to a jury. Or that's at least how it feels when one watches all the management types, head out the back of the courtroom before the jury is selected. Thanks to the Illinois Trial Practice Weblog for the pointer to the story. Obviously doing a better job of reading Texas papers than I was.

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Drum Circles - The Latest Tool In Employee Retention?

Posted 5:05 PM by Michael Fox

Beats me. But it's at least being tried by some. Check the AP's Michael P. Regan's story in the Holland Press Sentinel. If you don't go for such events yourself, there are a couple of experts quoted who agree with you and might give you some ammunition if you are trying to avoid a team building ropes or rappelling event.

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Be Wary of Phone Calls Telling You to Strip Search Your Employees!

Posted 4:49 PM by Michael Fox

Something that almost seems so far fetched as to be an urban legend, is not, as you can see in this report from the Rapid City Journal on a trial just concluded in that South Dakota city. A manager of a Hardee's restaurant was found not guilty of rape and kidnapping, after he held one of his female employees in custody for three hours, had her strip naked and searched her, all at the insistence of a male telephone caller who told him he was working with Hardees' management officials and the police. The jury which saw a video tape of the episode, plus heard the testimony of the victim, would have convicted the defendant of something, but not the severe crimes of rape or kidnapping. Although I frequently say given what I have seen over the past quarter of century happen in the workplace, almost nothing surprises me, but I have to admit, this one does.

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Bullying - A Movement In Progress?

Posted 4:19 PM by Michael Fox

I have commented before on the British treatment of bullying, which seems a very wide door to open. A British HR consultancy has an article that gives an overview. However, I am beginning to see more and more written about it as a concept for concern, including this article about anti-bullying curriculum being developed both for grade schools and the college level. According to one author of such a course, bullying is the "fertile practice field" for sexual harassment that has its seeds in the high school setting. That may be the tie that gets into the employement law area, but employers will rue the day that either the legislature or judiciary start down this broad and ill defined path.

Labels: bullying

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Saturday, February 14, 2004

6th Cir. Struggles With the Administrative Exemption

Posted 7:41 PM by Michael Fox

When each member of a three judge panel has a different view of the application of the administrative exemption to a set of facts, if nothing else it supports the need to clarify the clearly outdated regulations. The position in question, a qualified shipping specialist for an electric company, was primarily involved in shipping radioactive materials and waste. In Schaefer v. Indiana Michigan Power Company (6th Cir. 2/13/04), one judge would uphold the grant of summary judgment for the employer that the position was exempt under the administrative exemption and one would reverse and instruct the district court to enter summary judgment for the employee that the position was not exempt. The middle road, and ultimately the action of the court is to reverse the summary judgment and send it back for trial. The opinion of the Court, written by Judge Guy Cole, Jr. found the employer failed to establish two aspects of the exemption: that the work was administrative in nature and that it required the use of discretion. Although by no means clear, my guess is that this is one case where the new regulations might well make the difference.

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Difficulties Under the ADA When Work Is the Major Life Activity

Posted 7:05 PM by Michael Fox

The First Circuit notes that the Supreme Court has not yet accepted that "work" is a major life activity under the Americans with Disabilities Act. In Sullivan v. The Neiman Marcus Group, Inc. (1st Cir. 2/13/04) it discusses what it thinks the Supreme Court meant when it held there are "conceptual difficulties inherent in the argument that working could be a major life activity." The problem as the Court sees it:

One of these difficulties poses a significant Catch-22 dilemma for an ADA claimant such as Sullivan. To be eligible for ADA protection, he must demonstrate that he is a "qualified individual" for the position at issue. [cite omitted] By demonstrating that his ability to work is substantially impaired, he may demonstrate that he is unqualified for the job and, therefore, excluded from ADA protection. If he does not introduce such evidence, however, he may fail to show that he was substantially impaired.

In this case the impairment was alcoholism, a category which the court notes is even harder to prevail on because of the statutory provision in the ADA that allows an employer to hold alcoholics to the same standards as other employees, even if the impact on their performance is due to alcoholism.

Labels: ADA

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Thursday, February 12, 2004

Prize For First Adverse Determination By An ALJ Under Sarbanes-Oxley - Floyd, VA

Posted 10:20 PM by Michael Fox

The Hampton Roads Daily Press has the story of the first Sarbanes-Oxley complainant to obtain a favorable ruling from an Administrative Law Judge. And as the story says, no one would have expected the first case to be in a small town bank holding company with approximately 600 shareholders. The bank's lawyer didn't agree with the use of Sarbanes Oxley in this instance:

The law "was never intended to protect employees from a dispute with management. We know what it was intended to do. It was really intended to root out corruption in big companies that employ a lot of people."

Nevertheless, absent a reversal by the Administrative Review Board or the 4th Circuit Court of Appeals, it will have first taken root in small town soil. Go here for the ALJ's opinion.

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Wednesday, February 11, 2004

Defending the First Amendment from Antidiscrimination Laws

Posted 2:07 PM by Michael Fox

A law review article so titled by David Bernstein, a professor of law at George Mason University School of Law and also a regular contributor to the Volokh Conspiracy can be downloaded from the following link.

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Supreme Court Review Sought for Age Old Question: Are Disparate Impact Claims Actionable Under the ADEA?

Posted 1:41 PM by Michael Fox

From the authors of one of the premier legal blogs SCOTUS, comes the news today that as part of a Stanford seminar apparently taught in part by Tom Goldstein, they are filing this petition for writ of certiorari arguing that the 5th Circuit was wrong, when it answered the question no. The underlying case is referenced in my earlier note about the 5th Circuit decision.

There is no question the Supreme Court needs to address this issue soon, and as long as the answer is the same as that of the 5th Circuit, I don't mind if it is now.

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Tuesday, February 10, 2004

FAA Not A Jurisdictional Statute - For Diversity Jurisdiction, Amount of Award Controls

Posted 8:26 AM by Michael Fox

The 9th Circuit, not usually a good place for employers with arbitration agreements, nevertheless deals with the first question a court of limited jurisdiction must ask (Professor Ward again): do we have jurisdiction? For jurisdiction based on diversity, the amount in controversy must be $75,000. Here the claim in the underlying arbitration was for more than that amount, but the award being challenged was zero. It was the latter amount that the Court found controlled, thus no diversity jurisdiction. Luong v. Circuit City Stores, Inc. (9th Cir. 1/30/04) [pdf]. The Court dodged a tougher question as to whether the statutes that were the basis for the arbitration claim (ADA, Title VII) created federal question jurisdiction. If the employee had argued there was a manifest disregard, then that question would have been presented, but it did not. Clearly even though arbitration may be clearly accepted, there is going to be plenty of litigation around the issue.

Labels: arbitration

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Sunday, February 08, 2004

County Gets The Bill For Defending Sexual Harassment Case

Posted 8:04 PM by Michael Fox

And it's not insubstantial, even for a "client with taxing authority" as one of my former partners used to say. Even though the trial has come and gone, with a split verdict, there are still the appeals and already Maricopa County is down almost $800,000 according to a story in the Arizona Republic. And that doesn't count the payments to the plaintiff's' attorneys that will be owed, or at least fought about. Litigation is expensive, but not generally this expensive. My guess without knowing more is that the political fight which seems to have swirled around the case contributed to the ultimate cost. Still, a good reminder of the costs of the system.

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9th Cir. WARN Case Goes Against Employer, In Pretty Much Every Way Possible

Posted 6:06 PM by Michael Fox

There are not that many WARN cases that go to trial. No doubt the employer wishes Childress v. Darby Lumber, Inc. (9th Cir. 2/6/04) [pdf] had been one of them. Unfortunately, it did and the employer lost on the issue of joint employer and the defenses of good faith, business circumstance's and faltering business. The good faith defense for certain, and probably the faltering business, exception were lost because the employer had no clue that the WARN act existed, not that it misjudged the proper application. The employer also lost on attorneys fees, as the appeals court upheld an award of over $120,000 whereas the actual damages were only slightly more than $60,000. Ouch.

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Thursday, February 05, 2004

More On the Issue of Religious Accommodation in the Workplace

Posted 12:15 PM by Michael Fox

In support of my contention that the issue of religion in the workplace just might be the theme of the year for 2004, check out the intra-blog comments on the issue at the Volokh Conspiracy with comments by David Bernstein referencing an earlier post by Eugene Volokh. The comments are sparked by an AP story over an Eckerd pharmacist's refusal to fill a prescription for the morning after pill because of religious convictions.

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Wednesday, February 04, 2004

Cirque du Soleil Takes HIV Positive Employee Back

Posted 7:14 PM by Michael Fox

Or at least makes that unconditional offer. Although it came shortly after the EEOC announced that it had found reasonable cause to believe there was discrimination against Matthew Cusick, according to the story in the Casino City Times the troupe said that did not play much of a role in its decision. Hmmm.

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Professor Bernie Ward, May He Rest in Peace, Would Have Loved It

Posted 6:24 PM by Michael Fox

While Charles Allen Wright was better known, Bernie Ward was an equally talented federal courts scholar at the University of Texas Law school when I was a student. I had Professor Ward and still marvel at the quality of his lectures and his interest in the fine jurisdictional distinctions related to the federal courts, which we were frequently reminded are "courts of limited jurisdiction." While I have doubts that many will relish wading through Judge Easterbrook's opinion in Baker v. IBP, Inc. (7th Cir. 4/4/04) [pdf], Professor Ward would have loved at least the initial discussion on why the district court was wrong to find that it lacked jurisdiction.

Professor Ward may not have been as interested in Judge Easterbrook's continuing dissertation over the economic problems with plaintiffs' case, which ultimately lead him to find it should be dismissed for failure to state a claim on which relief could be granted.

Almost lost among all the jurisdictional and law and economic writing is an unusual set of allegations - that IBP, acting with others, was depressing the labor market by knowingly hiring illegal aliens, going so far as to allege that IBP would notify these workers on days when the INS might appear. (Judge Easterbrook wryly notes that the complaint fails to state how IBP knows of such dates.) This was a violation of RICO according to the complainants.

But for reasons you will have to read the opinion to discern, not a claim that could be successfully made as a legal matter.

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ERISA Statement of Rights Is Not A Forum Selection Clause

Posted 5:51 PM by Michael Fox

MetLife was no doubt shocked when it removed a claim for disability benefits under an employee benefit plan to federal court on the basis of a federal question and had it remanded to state court. The district court relied on language in the STATEMENT OF ERISA RIGHTS which provides in part, "If you have a claim for benefits which is denied or ignored, in whole or in part, you may file suit in a state or federal court." Interpreting this as a contractual forum selection clause, the court held that MetLife was bound by an agreement that the case could be heard in state court. Since MetLife had copied a model form provided by the DOL for compliance with ERISA, it was less than pleased. Fortunately, the 7th Circuit had jurisdiction to hear the appeal of the remand since it was based on a choice of forum clause rather than a lack of jurisdiction.

And all is well that ends well, if of course you omit the judicial time and attorneys fees and expense caused by the erroneous decision. The 7th Circuit quickly found (less than 1 month after oral argument)what seems obvious, that this language was just a statement of rights, not a contractual agreement. Cruthis v. Metropolitan Life (7th Cir. 2/2/04) [pdf]. The denial of coverage was in 2001, the motion to remand was in April of 2003, and now in February of 2004, the case gets sent back to the district court for a ruling on the merits.

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An Age Case With No Mention of Age - A Jury Verdict Survives

Posted 5:27 PM by Michael Fox

It is somewhat unusual to read a case where the sole issue is a claim under the ADEA and there is no mention of the age of either the individual hired or the plaintiff. Since the primary liability issue raised by the defendant challenging an adverse jury finding was whether the plaintiff was qualified, it was not important to the decision, but still funny not to find it. Aside from that oddity, Potence v. Hazelton Area School District (3rd Cir. 2/2/04) [pdf] is primarily educational as to the evidence sufficient to support a jury verdict. Here, stories of why Potence was not hired which changed over time (including one refuted by a postal receipt) plus what the court calls "ageist" comments by an individual with influence in the hiring decision is enough. And of course, as frequently happens, the amount owed was doubled as the violation was found to be willful.

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The Newest Protected Class - Ex-Cons?

Posted 3:29 PM by Michael Fox

Find a group that is discriminated against and pretty soon you will find someone suggesting that the group gain legal protection. Without a question, those who have served time in the penal system carry a stigma and are, I am quite certain, frequent victims of discrimination. Now according to a story in the Cleveland Plaindealer, the city of Cleveland is considering using its purchasing power to prohibit discrimination against ex-cons. Whether that approach is better than the "Prisoner Re-Entry Initiative", as reported by the American Baptist Press, and suggested by President Bush in the state of the union address, is an interesting question. At least Cleveland's proposed program does not come with $300 million price tag, just more restriction on employers. Thanks to the Jurist for the pointer to the Plaindealer article.

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Tuesday, February 03, 2004

A Novel Theory - And What A Potential Can of Worms - Justify Your Settlement Amount

Posted 8:51 AM by Michael Fox

Sometimes the information you get on line is sketchy, but the following report of a lawsuit filed in the Southern District of Texas this week makes one marvel at the potential for abuse if this lawsuit does not quickly get quashed. As summarized by a reporting service it is:

Racial discrimination case in which the defendant offered the plaintiff $27,000-$30,000 in compensation for a carpal tunnel injury when similarly situated whites were offered more.

First there was Batson, and now called to task to explain why we settled this lawsuit for more than another one?

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Sunday, February 01, 2004

Civil Rights Act of 1964 - Forty Years Old - Have We Gone Too Far?

Posted 4:56 PM by Michael Fox

The Pioneer Press of the Twin Cities editorializes about how discrimination laws have evolved since the passage of the Civil Rights Act of 1964. Two areas where it finds tension are the treatment of religious organizations and the establishment of language and conduct codes in response to hostile environment type claims. While certainly no one can deny the great good that has come from the Act, that does not mean there should not be serious thought and discussion about consequences which may not be positive. Thanks to David E. Bernstein at the Volokh Conspiracy for the pointer. And check out Bernstein's article about what he sees as the growing conflict between antidiscrimination laws and civil liberties.

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