Employment Law Update – Summer 2011
Supreme Court Expands Potential Employer Liability for Retaliation
Two recent U.S. Supreme Court cases highlight a continuing trend to broaden the reach of federal employment law prohibiting retaliation against employees who bring complaints against their employer. First, in January of this year the Court held that an employee, who claimed he was fired because his fiancée filed a gender discrimination claim against the same employer, has a cognizable retaliation claim. In Thompson v. North American Stainless, LP, Eric Thompson and his fiancée, Miriam Regalado, were both employees of North American Stainless (NAS). Ms. Regalado filed an EEOC charge alleging sex discrimination against NAS and, three weeks later, NAS fired Mr. Thompson. Mr. Thompson then filed his own charge of discrimination with the EEOC, claiming he was fired in retaliation for his fiancée’s sex discrimination charge. While the trial and appellate courts refused to recognize Mr. Thompson’s retaliation claim, the U.S. Supreme Court reversed, ruling that Title VII’s anti-retaliation provision prohibits any employer action that “well might have dissuaded a reasonable worker from making or supporting a charge of discrimination.” Since an employee might be dissuaded from filing a charge if she knew that her fiancé would be fired, the Supreme Court ruled that this was potential retaliation, and (somewhat unusually) that the fiancé could bring his own claim even though he neither complained nor assisted in a complaint.
The Thompson case begs the question, will an employer be at risk any time it fires any employee who happens to have a connection with another employee who filed a charge with the EEOC? The Supreme Court indicated that there could not be a “categorical rule.” Ominously, the Court left open the possibility that a wide range of relationships might be implicated; each situation would have to be reviewed to determine whether a fired fiancée, girlfriend/boyfriend, close friend, or trusted coworker would be able to bring a claim of retaliation.
More recently, in March the U.S. Supreme Court ruled that an employee’s oral complaint about his/her employer’s wage practices was enough to trigger the anti-retaliation protections of the Fair Labor Standards Act (FLSA) in Kasten v. Saint-Gobain Performance Plastics Corp. In contrast to Title VII, the FLSA requires a complaint to be “filed” to trigger protection against retaliation. The “filing” language led some courts to conclude the complaint had to be in writing. However, the Court ruled that if an oral complaint is sufficiently clear and detailed for a reasonable employer to understand it as an assertion of an employee’s rights protected by the FLSA, that employee would come within the protection of the FLSA’s anti-retaliation provisions. This decision, once again, resolved a split in the lower courts in a way that favors employees.
These two cases point out that employers need to take particular care in disciplining any employee after a complaint about the legality of the employer’s practices has been lodged. Given the breadth of the employment law prohibitions against retaliation and the recent rise in the number of retaliation claims generally, practical guidance in this area will be presented to attendees of K&C’s third showing of the 27th Annual Employment Law Update at the Hampton Roads Convention Center on July 14, 2011, as part of the “Investigating Employee Misconduct” workshop.
ADAAA Regulations Represent Increasing Risk for Employers
The Americans with Disabilities Act Amendments Act (ADAAA) was signed in 2008, but final regulations only became effective last month. The new regulations issued by the U.S. Equal Employment Opportunity Commission (EEOC), significantly change the landscape for employers dealing with medical conditions of employees and applicants for employment.
The key changes implemented by the EEOC’s new regulations expand the definition of “disability” to cover virtually anyone with a medical condition. Technically, the original ADA definition of “disability” as, among other things, physical or mental impairment that “substantially limits” a “major life activity,” remains. However, the new regulations impose a much lower threshold for satisfying this requirement.
For example, the original list of “major life activities” was short and conservative. The ADAAA and new EEOC regulations add to this conservative list with activities such as bending, thinking, reading, sitting and interacting with others. Prior Supreme Court decisions now provide minimal (or even incorrect) guidance. For example, the positive effects of almost all mitigating measures can no longer be taken into account. “Impairments” that are in remission – and which may manifest no current symptoms – may nevertheless qualify as a “disability.”
The EEOC instructs that an employer’s focus should be on whether it has met its ADAAA obligations and not whether an individual’s impairment substantially limits a major life activity. Indeed, the EEOC requires that “substantial limitation” be determined by a common-sense assessment of the individual’s ability to perform and that a far lesser degree of “limitation” is required for this analysis. In short, both Congress and the EEOC believe that employers were winning too many cases by showing the employee was not “disabled.”
The new regulations do not change an employer’s non-discrimination and reasonable accommodation obligations, but it makes them applicable to a much larger group of employees and applicants for employment. Employers must be aware of the increased risk of claims and should take steps to ensure that human resource professionals and front line supervisors are aware of these changes. Distributing updated policies and conducting supervisory training are two of the most common steps employers are taking in response to this change in the law.
Non-Employee Harassment Comes to the Fourth Circuit
In a recent unpublished decision, EEOC v. Cromer Food Service, the U.S. Court of Appeals for the Fourth Circuit (the federal appeals court covering, Maryland, Virginia, West Virginia, North Carolina and South Carolina) held that an employer can be held liable to one of its employees who is harassed even when the harassment occurred off of the employer’s premises and was committed by the employees of a customer. In so holding, the Fourth Circuit followed the lead of the EEOC and other federal courts that have addressed this issue and adopted a “negligence” standard for liability. This means that an employer can be liable for harassment of one of its employees by a non-employee if it knew or should have known of the harassment and failed to take prompt, appropriate remedial action to stop it.
As exemplified by this recent decision, a claim of non-employee harassment can put an employer in the uncomfortable position of having to confront a customer regarding allegedly inappropriate behavior. In any event, this case highlights the need for employers to be sensitive to and investigate all claims of workplace harassment, whether or not the alleged incident even occurred in the employer’s “workplace.” Harassing conduct by customers, visitors, vendors, and anyone else whom employees must come in contact with in the course of their work could lead to employer liability.
Retaliation and Disability Discrimination Claims on the Rise
In FY 2010, the Equal Employment Opportunity Commission (EEOC) received just under 100,000 private sector discrimination charges. This was the second time in the past three fiscal years that the EEOC set a record high for charges received. Of particular note, this was the first time in EEOC charge-handling history that race discrimination charges did not lead the pack. The new leader? Retaliation claims under all of the statutes the EEOC enforces accounted for the largest number of charges filed during the last EEOC fiscal year. Disability discrimination charges also rose substantially in the wake of the ADAAA, which is a trend expected to increase with recent court cases and new regulations defining that law.
Despite the record number of charges, the EEOC was “pretty much able to hold the line” regarding its case backlog, according to the EEOC Chair Jacqueline A. Berrien. This was probably due to the recent EEOC budget increases and the fact that the number of individuals employed by the EEOC has increased by approximately 200 over the last two years. In a January interview with the Bureau of National Affairs, Inc., Chairperson Berrien stated, “The recent ability to increase staffing, to provide some training opportunities, to improve technology, are all things that have been encouraging.” But she went on to state she was concerned that these improvements may be short-lived if the EEOC budget is limited following the 2010 mid-term elections giving Republicans control of the House with members of both political parties vowing closer scrutiny of federal spending and hiring.
Portsmouth Jury Issues $25 Million Verdict Against Employer
A jury recently handed down a $25 million verdict in favor of an individual who sued his employer for injuries allegedly exacerbated by the employer’s negligent failure to provide a prompt and appropriate medical response. The jury’s verdict was so large, in fact, that the judge agreed to reduce the amount of the award, which he found “appallingly excessive.”
While the facts and claims of that case are not typical to most employment disputes, the message conveyed by the jury may be instructive. Juries will hold employers to very high standards, particularly when sympathy for an injured employee is involved. Also, evidence such as the company’s net worth may serve to “unfairly enlarge the award of damages” against the company, as explained by the judge in this case.
Mock Trial Highlights 27th Annual ELU Seminar
At the March showing of the 27th Annual Employment Law Update attendees not only viewed portions of a mock trial but participated as the jury, ultimately deciding the fate of Antoinette Merriweather, a problematic employee who sued her former employer for age discrimination and wage-hour claims. The seminar received uniformly high reviews and the attendees found the mock trial to not only be entertaining but highly educational.
On July 14, the K&C Employment Law Team will host the final showing of the 27th Annual Employment Law Update at the Hampton Roads Convention Center. This will be the last chance for attendees to decide the fate of Ms. Merriweather and attend a number of timely topics including Investigating Employee Misconduct; the K&C Discipline and Discharge Clinic; Dealing with Problem Absenteeism; and Mediation, Severance & Release Strategies.
For more information, contact Kerry Martinolich at (757) 624-3232 or (804) 771-5722.
This program has been approved for 6 credit hours toward PHR and SPHR recertification through the Human Resource Certification Institute (HRCI). For more information about certification or recertification, please visit the HRCI homepage at www.hrci.org.
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