Barbara L. Johnson
1300 E Street, NW, Ste. 400E
Washington, DC 20005
45 Rockefeller Plaza
New York, NY 10111
Andrew N. Knauss
Potter & Murdock, P.C.
252 N. Washington St., Ste. 2
Falls Church, VA 22046
Morgan, Lewis & Bockius LLP
1111 Pennsylvania Ave., NW
Washington, DC 20004
Morgan, Lewis & Bockius LLP
1111 Pennsylvania Ave., NW
Washington, DC 20004
45 Rockefeller Plaza
New York, NY 10111
Andrew N. Knauss
Potter & Murdock, P.C.
252 N. Washington St., Ste. 2
Falls Church, VA 22046
Yvette V. Gatling
Littler Mendelson, P.C.
1650 Tysons Blvd., Ste. 700
Tysons Corner, VA 22102
Littler Mendelson, P.C.
815 Connecticut Ave., Ste. 400
Washington, DC 20006
Littler Mendelson, P.C.
815 Connecticut Ave., NW, Ste. 400
Washington, DC 20006
1300 E St., NW, Ste. 400E
Washington, DC 20005
1300 E St., NW, Ste. 400E
Washington, DC 20005
Dinsmore & Shohl LLP
222 W. Adams St., Ste. 3400
Chicago, IL 60606
Dinsmore & Shohl LLP
222 W. Adams St., Ste. 3400
Chicago, IL 60606
Jennifer S. Baldocchi
Paul Hastings LLP
515 South Flower St., 25th Floor
Los Angeles, CA 90071
Paul Hastings LLP
515 South Flower St., 25th Floor
Los Angeles, CA 90071
Joseph P. Marcus
Paul Hastings LLP
515 South Flower St., 25th Floor
Los Angeles, CA 90071
Paul Hastings LLP
515 South Flower St., 25th Floor
Los Angeles, CA 90071
Maryam S. Sonboli-Dieguez
515 South Flower St., 25th Floor
Los Angeles, CA 90071
Jennifer S. Baldocchi
Paul Hastings LLP
515 South Flower St., 25th Floor
Los Angeles, CA 90071
515 South Flower St., 25th Floor
Los Angeles, CA 90071
Joseph P. Marcus
515 South Flower St., 25th Floor
Los Angeles, CA 90071
515 South Flower St., 25th Floor
Los Angeles, CA 90071
Maryam S. Sonboli-Dieguez
515 South Flower St., 25th Floor
Los Angeles, CA 90071
Tomas J. Garcia
500 Fourth St. NW, Ste. 1000
Albuquerque, NM 87102
Jennifer A. Kittleson
500 Fourth St., NW, Ste. 1000
Albuquerque, NM 87102
Andrew N. Knauss
Potter & Murdock, P.C.
252 N. Washington St., Ste. 2
Falls Church, VA 22046
D.C. Circuit & Supreme Court
Andrew N. Knauss
252 N. Washington St., Ste. 2
Falls Church, VA 22046
Michael C. Comartin
Ogletree Deakins International LLP
220 Bay St., Ste. 1100, PO Box 15
Toronto, Ontario M5J 2W4
Michael F. Lee
Ogletree Deakins International LLP
220 Bay St., Ste. 1100, PO Box 15
Toronto, Ontario M5J 2W4
§ 15.1 Introduction
§ 15.2 Disability Discrimination
§ 15.2.1 Burden of Proof / Evidentiary Standards
Nat’l Fed’n of Blind, Inc. v. Epic Sys. Corp., No. 18-12630-RWZ, 2020 BL 42492 (D. Mass. Jan. 31, 2020). The District of Massachusetts dismissed a claim by the National Federation of the Blind (“NFB”) against Defendant Epic Systems Corporation (“Epic”), a corporation that develops, sells, and licenses health-care software to medical providers and health-care institutions. NFB argued that Epic’s sale and licensing of software that is inaccessible to blind users violates § 4(4A) of the Massachusetts Fair Employment Practices Act (Mass. Gen. Laws. ch. 151B). According to the Court, the statue requires proof of two elements: (1) a defendant utilized specific employment practices or selection criteria knowing that the practices or criteria were not reasonably related to job performance; and (2) a defendant knew that the practices or criteria had a significant disparate impact on a protected class or group. The Court concluded that Plaintiff failed on the first prong as Epic did not utilize any specific employment practice or selection criteria because Epic only sold and licensed software. The Court acknowledged that courts have extended liability to non-employers who have caused employers to utilize specific employment practices or selection criteria that had a disparate impact, such as when a state division of human resources administered a problematic employment qualification exam or in instances of vicarious liability, when a general contractor is liable to the employee of a subcontractor. Here, however, the Court found that Epic’s knowing sale of software that is inaccessible to blind users is not enough to trigger liability for its customers’ treatment of their blind employees.
Clark v. Champion Nat’l Sec., Inc., 952 F.3d 570 (5th Cir. 2020). Plaintiff, an insulin-dependent Type II diabetic, worked as a personnel manager for Defendant. Plaintiff requested and was granted two accommodations for his diabetes. Plaintiff was terminated after violating Defendant’s “alertness” policy; however, Plaintiff maintained he passed out due to low blood sugar relating to his diabetes and was not asleep. Plaintiff sued under the ADA, alleging discrimination and harassment on the basis of disability, retaliation, failure to accommodate a disability, and failure to engage in the interactive process. The district court granted Defendant’s motion for summary judgment. The Fifth Circuit reviewed de novo and applied the same standard as the district court did. The Court found that Plaintiff was unable to provide direct evidence of disability discrimination to support his claim and failed to meet the standards for a disability harassment claim. The Court also affirmed the district court’s holding that Plaintiff was not “a qualified person under the ADA and even if he were, his failure to accommodate claim would still fail because he is unable to show that a reasonable accommodation would have allowed him to perform his job and he did not request an accommodation for loss of consciousness due to diabetes. Finally, the Fifth Circuit also affirmed the district court’s ruling that Plaintiff’s retaliation claim failed because he could not show that he would not have been terminated “but for” filing an internal harassment complaint eight months prior.
Pierri v. Medline Indus., Inc., 970 F.3d 803 (7th Cir. 2020). The Seventh Circuit affirmed an order of summary judgment in favor of a defendant-employer that held plaintiff could not establish a theory of associational discrimination because defendant had made repeated efforts to accommodate plaintiff’s need to care for a relative, including allowing plaintiff to work an alternate schedule. Plaintiff, a former chemist, was fired after he failed to return to work following approved leave under the Family and Medical Leave Act (FMLA). Plaintiff requested accommodation to care for his ailing grandfather (diagnosed with liver cancer), to which Defendant-employer was receptive, and offered a number of accommodations including approved FMLA leave one day per week. According to Plaintiff, upon commencement of the schedule, his supervisor began to harass Plaintiff, belittling him in front of others, and refusing to assign research and development work to him. Plaintiff filed complaints with HR and requested full-time leave, citing stress and anxiety. Defendant-employer granted Plaintiff full-time leave but Plaintiff never returned to work. The Defendant-employer eventually terminated Plaintiff’s employment for his failure to return to work or provide a return date. Plaintiff sued, alleging discrimination for association with his grandfather and retaliation for filing harassment complaints with HR. Plaintiff argued association discrimination under the theory of distraction, which arises when an employee becomes inattentive to work because of a family member’s disability that requires the employee’s attention, yet not to the extent that requires an accommodation. The District Court rejected plaintiff’s argument and the Seventh Circuit affirmed. Furthermore, the Seventh Circuit affirmed that even if the Plaintiff could prove some form of associational discrimination, he had not suffered an adverse employment action because, among other things, the complaints the Plaintiff made about his supervisor involved just “general rudeness,” which did not rise to the level of an adverse employment action.
Cook v. George’s, Inc., 952 F.3d 935 (8th Cir. 2020). Plaintiff alleged discrimination in hiring, and pled sufficient facts to show he was disabled under the ADA. Nonetheless, the District Court granted Defendant’s motion to dismiss and denied leave to amend on the grounds that Plaintiff had failed to state facts sufficient to establish a prima facie ADA claim in his complaint. Plaintiff had alleged that he was disabled, that he had previously worked for Defendant with reasonable accommodations, and that Defendant used a classification system to mark people with disabilities as ineligible for rehire. The Eighth Circuit reversed, holding that a plaintiff need not establish a prima facie case at the motion to dismiss stage. To state a claim, a plaintiff need only meet the plausibility pleading standard. For ADA cases, a plaintiff need only plausibly plead that (1) he can perform the essential functions of a job with reasonable accommodations, and (2) that he was discriminated against in a way prohibited by the ADA. The Court found that Plaintiff’s allegations were sufficient to state a claim for purposes of a motion to dismiss.
Anthony v. Trax Int’l Corp., 955 F.3d 1123 (9th Cir. 2020). The Ninth Circuit held that after-acquired evidence may be used to show that a person is not a “qualified individual,” and thus not within the protection of the ADA. Plaintiff alleged that she was fired from her job as a Technical Writer because of her PTSD. During the course of the litigation, it was discovered that Plaintiff lacked the bachelor’s degree required of all Technical Writers, contrary to her representation on her employment application. Under Defendant’s government contract, it could only bill for technical writer work done by technical writers with bachelor’s degrees. The Court affirmed the use of the EEOC’s two-step inquiry, which requires an individual satisfy the prerequisites of a job to be a “qualified individual” for ADA purposes. The Court found that the Supreme Court’s prohibition on the use of after-acquired evidence to establish a superseding, non-discriminatory justification for an employer’s challenged actions (McKennon v. Nashville Banner Publ’g Co., 513 U.S. 352 (1995)) did not prohibit the use of after-acquired evidence for other purposes, such as to show an individual was not qualified under the ADA.
Exby-Stolley v. Bd. of Cnty. Comm’rs, 979 F.3d 784 (10th Cir. 2020) (en banc). Plaintiff brought a discrimination claim against her former employer, alleging that it had failed to reasonably accommodate her disability under Title I of the ADA. The jury found that Plaintiff was a qualified individual with a disability, but ruled in the employer’s favor because Plaintiff had not proven that she suffered any adverse employment action on account of her disability. Plaintiff appealed, arguing that the district court erred in instructing the jury that she must establish an adverse employment action in her failure-to-accommodate claim. A Panel Majority affirmed the district court’s judgment, but then the Tenth Circuit agreed to rehear the case en banc. In its en banc rehearing, the Tenth Circuit reversed the district court’s judgment and remanded for a new trial. Relying upon Tenth Circuit precedent, EEOC guidance, and decisions of other circuit courts, the Tenth Circuit held that an adverse employment action is not a requisite element of a failure-to-accommodate claim. In order to establish an ADA discrimination claim, an employee must show: (1) that he or she is disabled within the meaning of the ADA; (2) that he or she is qualified to perform the essential functions of the job, with or without a reasonable accommodation; and (3) that he or she was discriminated against because of a disability. The issue in this case centered on the third element of an ADA discrimination claim, i.e., what constitutes discrimination in a failure-to-accommodate claim. The Tenth Circuit explained that unlike disparate-treatment claims under the ADA—wherein an employee alleges that an employer discriminated against the employee through its discriminatory actions—a failure-to-accommodate claim concerns an employer’s failure to act. Consequently, once an employee establishes that the employer is on notice of the employee’s disability but fails to reasonably accommodate his or her disability, the employee need not go any further to show that he or she suffered an adverse employment action.
Aubrey v. Koppes, 975 F.3d 995 (10th Cir. 2020). Plaintiff employee became unable to work for a period of time due to a rare medical condition. Plaintiff’s employer allowed Plaintiff to take several months off work beyond her FMLA leave, but she was eventually terminated from employment. Plaintiff claimed that she had recovered enough to return to work with a reasonable accommodation, but that her employer discriminated against her due to her disability; failed to accommodate her disability despite her requested reasonable accommodations; and fired her in retaliation for requesting an accommodation. Plaintiff brought claims under the ADA, Rehabilitation Act, and applicable state law. The Tenth Circuit relied on the ADA to resolve all claims and held that Plaintiff’s failure-to-accommodate and disability discrimination claims could survive summary judgment, but that her retaliation claim could not. First, the Tenth Circuit found that Plaintiff satisfied her burden of establishing a prima facie failure-to-accommodate claim by showing (1) that she was disabled for purposes of the ADA; (2) that she was qualified to perform the essential functions of the job with or without a reasonable accommodation; (3) that she requested a “plausibly reasonable” accommodation; and (4) that the County did not accommodate her disability. Although her employer presented evidence to challenge Plaintiff’s failure-to-accommodate claim, there were enough disputed issues of fact to preclude summary judgment. Second, the Tenth Circuit held that under the burden-shifting analysis of McDonnell Douglas Corp. v. Green, 411 U.S. 792 (1973), Plaintiff had also sufficiently established a prima facie case of disability discrimination and that there was a remaining issue of fact regarding whether her employer’s proffered reason for terminating Plaintiff was mere pretext. Accordingly, Plaintiff’s disability discrimination claim could also survive summary judgment. However, the Tenth Circuit did not find sufficient evidence in the record to support a finding that Plaintiff was terminated in retaliation for requesting an accommodation, and therefore her retaliation claim was properly resolved by the lower court on summary judgment.
§ 15.2.2 Defining Disability
Melo v. City of Somerville, 953 F.3d 165 (1st Cir. 2020). The Court allowed a former police officer to pursue Americans with Disabilities Act claims against the City of Somerville, Mass. The officer was forced to retire after it was determined that his blindness in one eye rendered him unable to carry out car chases. However, the Court vacated the lower court’s summary judgment determination because such ability may not have been an essential job function, given its absence from the department’s list of duties and responsibilities of a patrol officer. The Court concluded that even if a jury were to find high-speed pursuits an essential function of his job, the officer still had a chance at prevailing because a jury could also find that he can perform that function based on a doctor’s testimony that individuals with monocular vision frequently learn to compensate for their disability.
Eshleman v. Patrick Indus., Inc., 961 F.3d 242 (3d Cir. (Pa.) 2020). William Eshleman, a former employee, sued Patrick Industries, Inc., his former employer, alleging that his termination violated the ADA. Eshleman had taken two months of medical leave for a lung biopsy procedure and two vacation days for an upper respiratory infection. The district court dismissed the action, and Eshleman appealed. In a matter of first impression, the Third Circuit found that the district court had improperly dismissed the suit, where it had only evaluated the “transitory” nature of Eshleman’s biopsy while failing to separately consider whether such a procedure was “minor.” The ADA excludes impairments that are “transitory and minor”; thus, the Court observed that “‘transitory’ is just one part of the two prong ‘transitory and minor’ exception.” “The district court should have considered such factors as the symptoms and severity of the impairment, the type of treatment required, the risk involved, and whether any kind of surgical intervention is anticipated or necessary—as well as the nature and scope of any post-operative care.”
Darby v. Childvine, Inc., 964 F.3d 440 (6th Cir. 2020). Plaintiff sued Defendant, her former employer, alleging discrimination based on her health condition. Plaintiff took time off to undergo a double mastectomy and was terminated upon her return to work. Plaintiff was never diagnosed with breast cancer but had a family history of cancer and a genetic mutation known as BRCA1 mutation. The district court granted the Defendant’s motion to dismiss, holding that Plaintiff failed to provide support showing that the BRCA1 mutation is a physical impairment and that her mutation is akin to the “absence of cancer.” Looking at Section 12012(1)(A), the Sixth Circuit focused on three major aspects of the ADA’s definition of disability: (1) “physical or mental impairment,” (2) “substantially limits,” and (3) “major life activities.” Using this framework, the Court found that Plaintiff plausibly alleged that her impairment due to the BRCA1 mutation substantially limits her normal cell growth when compared to the general population. It further held that Plaintiff successfully pled the remaining aspects of her claim—that she was qualified to perform the essential functions of her position with reasonable accommodation and that her termination would not have occurred but for her disability. Accordingly, the Fifth Circuit reversed and remanded the district court’s dismissal of Plaintiff’s claims.
Kotaska v. Fed. Express Corp., 966 F.3d 624 (7th Cir. 2020). Plaintiff, a former employee of FedEx, was fired when an injury limited her ability to lift up to 75 pounds, as required for the position. About a year later, she was hired “off the books” as a handler, which also required her to lift up to 75 pounds. This time, her restriction was lifted so that she could lift up to 75 pounds up to the waist. However, three weeks in, FedEx discovered that the amount of weight Plaintiff could lift was still limited and fired her again. Plaintiff sued, alleging disability discrimination and retaliation. The Seventh Circuit affirmed that Plaintiff failed to prove that she was a qualified individual (i.e., someone who could carry out the essential functions of the job without exceeding her medical restrictions). For the Court, while lifting 75-pound packages overhead is not specifically an essential function, it does not mean that someone who can lift only 15 pounds overhead, such as plaintiff, is qualified. The Court found that Plaintiff inevitably would run into packages at weights beyond her limited capabilities. Regarding the retaliation claim, the Seventh Circuit affirmed that the inevitable inference was that the second dismissal was simply a following through with the first termination, with no causation between the two incidents.
Rinehart v. Weitzell, 964 F.3d 684 (8th Cir. 2020). Plaintiff prisoner suffered from diverticulitis, and alleged that while it was active, he suffered through “difficult and time-intensive digestive symptoms.” Plaintiff alleged he was discriminated against on the basis of this disability: the prison denied him certain privileges, due to keeping him in a cell with an in-unit toilet. The prison argued that given the episodic nature of diverticulitis, the condition could not be a disability for ADA purposes. The Eighth Circuit reversed the District Court’s sua sponte dismissal for failure to state a claim, holding that the impact of a condition is to be determined when it is active, and that Plaintiff’s allegations surrounding diverticulitis were sufficient to allege a disability under the ADA.
§ 15.2.3 Reasonable Accommodations
Trahan v. Wayfair Me., LLC, 957 F.3d 54 (1st Cir. 2020). The First Circuit found that Wayfair Maine LLC was properly granted summary judgment on a call center worker’s claim that she did not receive reasonable accommodations under the ADA and was discharged because of her post-traumatic stress disorder disability. The Court saw this case as a balance between important workplace protections that Congress has put in place for disabled employees and the right of employers to discipline their employees. The Court ultimately found that Plaintiff failed to show that Wayfair acted with discriminatory intent, namely because Plaintiff committed fireable misconduct including repeatedly referring to two coworkers as “bitches,” reacting aggressively when she believed one snapped at her, and other unprofessional conduct. The Court also rejected Plaintiff’s claim that the employer failed to accommodate her disability because they did not move her desk assignment or allow her to work from home. In response to these allegations, the Court pointed out that Plaintiff made these requests after she had committed the fireable misconduct, which the Court said should not be seen as an accommodation proposal, but more as a desire for forgiveness or a second chance. Further, the Court concluded that these requests were unreasonable because Wayfair did not have a work from home program at the time and because moving her desk in no way demonstrated to Wayfair that she would be able to comport herself with Wayfair’s Conduct Rules.
Bey v. City of New York, 437 F. Supp. 3d 222 (E.D.N.Y. 2020). Salik Bey and other named Plaintiffs are African American men employed as firefighters by the Fire Department of the City of New York (FDNY) and suffer from Pseudofolliculitis Barbae (PFB)—a physiological condition that causes disfigurement of the skin in the hair-bearing areas of the chin, cheek, and neck. Plaintiffs alleged that they were “disabled” and their rights were violated when the FDNY rescinded an appropriate accommodation exempting them from the FDNY’s grooming policy. The district court granted summary judgment in favor of Plaintiffs on their “failure to accommodate” and disability discrimination claims under the ADA, holding that they were entitled to have the accommodation previously in effect reinstated. After determining that PFB is an ADA-qualifying disability, the district court affirmed that “a reasonable trier of fact could find that the FDNY refused to provide a reasonable accommodation.” The court determined that reassignment to “light duty” was not a reasonable accommodation for Plaintiffs, who were hired “to respond to fires and other emergencies—an admired position of service to the public.” Finally, the district court determined that it would not be an undue hardship on the FDNY to allow the accommodation requested by Plaintiffs, where Defendants had admitted that “no heightened safety risk to firefighters or the public was presented by the accommodation previously in effect [and] Plaintiffs continued to perform their jobs satisfactorily.” The court concluded that “[t]he FDNY’s decision to abandon the prior accommodation was not based on any actual safety risks to firefighters or the public. Rather, driving the calculus was bureaucracy.”
Elledge v. Lowe’s Home Ctrs., LLC, 979 F.3d 1004 (4th Cir. 2020). The Fourth Circuit affirmed the district court’s grant of summary judgment in favor of defendant on claims of disability and age discrimination, and retaliation for filing an EEOC charge of discrimination. Plaintiff’s job as a market director for 12 of defendant’s stores required him to work 50-60 hours per week, most of which was spent on his feet. Following knee replacement surgery, plaintiff’s physician determined that plaintiff’s work restrictions (eight-hour days and four of walking or standing) were permanent. Defendant could not accommodate plaintiff’s permanent restrictions and advised plaintiff that he could find a new job with defendant within 30 days, and take a leave of absence if he needed additional time to search for a job. Although plaintiff utilized leave for several months while he searched for other positions, he ultimately requested early retirement and filed an EEOC charge of discrimination. With respect to the plaintiff’s disability discrimination claim, the Fourth Circuit deferred to the defendant’s judgment as to the essential functions of plaintiff’s position, in particular the ability to walk 66% of the day and work over forty hours each week. According to the Fourth Circuit, “no reasonable accommodation could, ultimately, have sufficed.” The Fourth Circuit also addressed the defendant’s hiring policy in light of the ADA’s duty to reassign. In determining that the defendant’s hiring policy was “disability neutral,” the Court cited the Supreme Court’s decision in U.S. Airways v. Barnett, 535 U.S. 391, 122 S. Ct. 1516 (2002), explaining that “Barnett does not require employers to construct preferential accommodations that maximize workplace opportunities for their disabled employees. It does require, however, that preferential treatment be extended as necessary to provide them with the same opportunities as their non-disabled colleagues.” The Court went on to reject plaintiff’s age discrimination claim for failure to present sufficient evidence to establish a prima facie case.
Austgen v. Allied Barton Sec. Servs., 815 Fed. App’x 772 (5th Cir. 2020). Plaintiff sued his former employer under the ADA, alleging failure to accommodate, discrimination, and retaliation. Plaintiff, who worked for Defendant as a Licensed Security Officer, reported that he could no longer perform the duties of his position, where the daily climbing he had to do aggravated his chronic back pain. Defendant placed him on a leave of absence until he could provide a doctor’s recommendation on suitable activity. Upon return, Plaintiff was offered and accepted a supervisory position at a different worksite that could accommodate his physical limitations and provide equivalent compensation. However, Plaintiff later filed suit. The district court granted Defendant’s motion for summary judgment on all claims. The Fifth Circuit reviewed all claims de novo. In reviewing the reasonable accommodation claim, the Court found that even if Plaintiff could show he was disabled, his claim would fail because temporary unpaid leave is not unreasonable, and he was offered a supervisory position that accommodated his disability with no reduction in compensation. Finally, the court held that unpaid leave does not constitute adverse employment action in the retaliation context, and Plaintiff failed to satisfy the burden for a discrimination claim. It observed that the district court’s error in failing to discuss this claim was harmless because the claim was meritless. Thus, the Fifth Circuit affirmed the district court’s findings on all claims.
Youngman v. Peoria Cnty., 947 F.3d 1037 (7th Cir. 2020). Summary judgment affirmed in favor of employer for employee’s failure to establish a causal relationship between the employee’s disability and symptoms experienced pursuant to a temporary assignment. Plaintiff, a former counselor of the juvenile detention center, suffered from the disabilities of hypothyroidism and hypocalcemia. Upon temporary assignment to a position in the control room, he experienced motion sickness from the electronic equipment emitting various humming, beeping, or buzzing noises in the room and the movement required to quickly operate and monitor all the equipment simultaneously. After presenting a doctor’s note that stated that plaintiff should avoid working in the control room without certain restrictions, plaintiff asked not to be assigned to the control room in the future as an accommodation, and requested instead to be placed as security or as a floater. Defendant responded that this accommodation would not be possible as counselors were required to rotate between various positions. Defendant also told plaintiff that he could return to work when his condition improved. After his medical leave time expired, plaintiff’s position was filled, and he was discharged for insubordination for failing to comply with the weekly progress report requirement of the medical leave. Plaintiff sued his employer for failing to accommodate his disabilities. The Seventh Circuit affirmed the district court’s ruling of summary judgment in favor of the defendant not because plaintiff was responsible for the breakdown of the interactive process, but rather that a failure to accommodate claim requires an employee’s limitation to be caused by the disability and plaintiff failed to establish any causal relationship between his hypothyroidism and the motion sickness.
D’Onofrio v. Costco Wholesale Corp., 964 F.3d 1014 (11th Cir. (Fla.) 2020). A split Eleventh Circuit panel upheld a district court’s decision to overturn a $775,000 jury verdict in favor of a deaf former Costco employee, rejecting her allegations that Costco had failed to adequately accommodate her disability under the ADA. The dispute stemmed from a 2015 complaint, where following her termination the employee claimed that Costco had discriminated and retaliated against her. The jury did not find that the employee was discriminated or retaliated against when she was dismissed; however, they awarded her compensatory and punitive damages for her failure-to-accommodate claims. The district court overruled this decision and the Eleventh Circuit affirmed, observing that the employee could not point to a specific instance in which she needed an accommodation and was denied one. Costco provided the employee with on-demand access to live sign-language interpreters via remote interpreting equipment, provided on-site in-person interpreters for group meetings, and arranged a thorough training session on deaf culture. While these accommodations did not line up with the employee’s preferences, which included a request for in-person interpreters rather than remote-interpreting equipment, they nevertheless were examples of Costco accommodating the employee’s needs. “[T]here is simply no basis in the evidentiary record to conclude that Costco’s use of a supposedly less preferable medium—[remote interpreting equipment]—represented a failure to make reasonable accommodations.” The Court found that the only accommodation not provided to the employee was her request to transfer her manager to another Costco location, a request that the ADA did not obligate Costco to fulfill.
§ 15.2.4 Regarded as Disabled
Waithaka v. Amazon.com, Inc., et al., 966 F.3d 10 (1st Cir. 2020). The First Circuit ruled that delivery workers who locally transport goods on the last legs of interstate journeys are exempt from the Federal Arbitration Act (“FAA”). The Court found that the exemption for “contracts of employment of seamen, railroad employees, or any other class of workers engaged in foreign or interstate commerce” extends to transportation workers who participate in interstate commerce, regardless of whether they physically cross state lines in doing so. Plaintiff was an independent contractor located in Massachusetts who contracted with Amazon to perform local deliveries through Amazon’s smartphone application (“AmFlex”). The AmFlex terms of service included an arbitration agreement. Plaintiff filed suit against Amazon alleging: (1) misclassification of AmFlex drivers as independent contractors, (2) violation of the Massachusetts Wage Act by requiring AmFlex drivers to bear their own expenses, and (3) violation of the Massachusetts Minimum Wage Law. Amazon sought to compel arbitration or, in the alternative, to transfer the case to the Western District of Washington. The District Court concluded that the AmFlex agreement was exempt from the FAA, that Massachusetts law governed the enforceability of the arbitration agreement, and that the provision was unenforceable under Massachusetts law. In affirming the District Court’s order, the First Circuit focused on the meaning of the term “engaged in . . . interstate commerce.” Relying on precedent under the Federal Employers’ Liability Act and analyzing the text, structure, and purpose of the FAA, the Court concluded that delivery workers who operate solely within state lines to deliver goods in the final leg of their interstate journey fall within the transportation worker exemption from the FAA. The Court then assessed the conflict of law issue, finding that Massachusetts’ public policy would invalidate a class waiver in an employment contract not covered by the FAA and that Massachusetts’ interest in enacting said public policy outweighed Washington’s interest in the case.
Lyons v. Katy Indep. Sch. Dist., 964 F.3d 298 (5th Cir. 2020). Plaintiff, a former employee of the Katy Independent School District (ISD), sued under the ADA, alleging disability discrimination, retaliation, and harassment following surgery. Plaintiff alleged that her reassignment was based on her procedure. The district court granted summary judgment to Defendant on all claims, holding that Plaintiff could not establish the first element of her prima facie case of disability-based discrimination. Plaintiff maintained she was “regarded as” disabled and not actually disabled. Without determining the standard a plaintiff who is “regarded as” disabled must reach as part of the prima facie case, the Fifth Circuit affirmed dismissal of the disability-based discrimination claim, finding that there was no dispute that Plaintiff’s impairments were transitory and minor. Though the Court held that the district court erred in its reasoning, it was correct in the conclusion that Defendant is entitled to summary judgment on the unlawful retaliation claim. The Court did not focus on whether a “causal connection” between Plaintiff’s protected activity and Defendant’s alleged adverse employment action existed; instead, it held that Plaintiff failed to demonstrate that there was a dispute of fact as to whether the school’s district’s reasons for its actions were pretextual.
Fisher v. Nissan N.A., Inc., 951 F.3d 409 (6th Cir. 2020). Plaintiff worked as a production technician on Defendant’s factory line. He took an extended leave due to kidney problems and returned after a transplant. He continuously requested a transfer to easier positions due to fatigue and side effects of his transplant, but his requests were denied. He received a final warning from Defendant and was terminated. Plaintiff sued Defendant, alleging discrimination and failure to accommodate. The district court granted summary judgment to Defendant on all claims. On appeal, the Fifth Circuit found that Plaintiff adequately provided evidence of his disability, that he was qualified for a vacant inspection position, and that Defendant failed to accommodate his disability by granting his transfer request. The Court held that Defendant was not entitled to summary judgment on the failure to accommodate claim. Next, the Court determined that Defendant was unable to present evidence of good-faith participation in the interactive process or how the accommodations Plaintiff suggested would cause undue hardship. Thus, the Court found that Defendant was not entitled to summary judgment.
§ 15.2.5 Interactive Process
There were no qualifying decisions this year.
§ 15.2.6 Miscellaneous
Lestage v. Coloplast Corp., 982 F.3d 37 (1st Cir. 2020). In a case of first impression, the First Circuit ruled that the proper causation standard for retaliation claims under the False Claims Act (FCA) is “but-for” causation. Plaintiff was a key account manager at Coloplast, responsible for making sales to and managing some of Coloplast’s largest accounts. In 2011, Plaintiff and others filed a qui tam action under seal under the FCA against Coloplast and several competitors and clients, including some of her own accounts. Shortly after the complaint was unsealed, a large account that was named in the qui tam complaint sent an email to Coloplast requesting that she be removed from the account. Four days after receiving this request, Coloplast placed Plaintiff on administrative leave until after the qui tam suit was resolved. Upon returning to work, Coloplast assigned Plaintiff a new mix of accounts and refused to place her on certain accounts she requested. The District Court gave the jury instruction to use the substantial motivating factor test for determining whether Coloplast had retaliated against Plaintiff. The First Circuit reviewed this decision under a plain error standard, concluding that, while the proper standard is but-for causation, the District Court had not committed plain error because this circuit had never decided the question. Relying on Supreme Court precedent under the Age Discrimination in Employment Act and Title VII, the Court reasoned that the statutory language was “materially identical” and that the but-for causation standard applies to retaliation claims under the FCA. Despite the application of the wrong standard, the Court also found that the jury had relied on sufficient evidence in coming to its determination that Coloplast had retaliated against Plaintiff.
Schirnhofer v. Premier Comp Solutions, LLC, 832 Fed. App’x 121 (3d Cir. (Pa.) 2020). Beth Schirnhofer, a former billing assistant for Premier Comp Solutions, LLC, filed an ADA discrimination claim. The Third Circuit upheld the decision of the district court, which found that Schirnhofer could not receive damages. Even though a jury had found her termination was discriminatory and calculated her damages to be $285,000, the Third Circuit observed that she would have been terminated even without an illegal motive. “[A] plaintiff may not recover monetary damages for that violation if the defendant shows that it ‘would have taken the same action in the absence of the impermissible motivating factor.’” However, Court did deny Premier’s appeal of the district court’s finding that the company had to pay part of Schirnhofer’s expenses—$177,187 in attorney fees and $13,259 in costs. This award was not an abuse of discretion, as the jury had rejected Premier’s argument that the ADA does not recognize PTSD as a disability.
Tonyan v. Dunham’s Athleisure Corp., 966 F.3d 681 (7th Cir. 2020). Plaintiff, a former store manager at an athleisure retail store, suffered a series of injuries, requiring her to receive multiple surgeries and temporary restrictions to her shoulder, arm, and hands. As she accumulated injuries, her doctor imposed permanent restrictions, one of which prevented her from lifting more than two pounds with her right arm. As a result, defendant terminated plaintiff’s employment because she could not perform the physical tasks that were essential to her job. Plaintiff filed suit against the defendant for disparate treatment and failure to accommodate. The district court granted motion for summary judgment in favor of the defendant on the disparate treatment claim. On appeal, plaintiff challenged the disparate treatment claim, for which she is required to prove, in part, that she was capable of performing essential functions with or without reasonable accommodations. Plaintiff asserts that her role involved much less physical labor than the employer suggested, contending that her essential functions were customer service and sales. However, defendant presented the job description and supporting documentation showing that physical labor was a necessary part of the role of a store manager, and essential to defendants’ business model. The Seventh Circuit held in favor of the defendant, citing that the plaintiff could not complete the essential functions of her job. The Court also stated “[w]e usually do not ‘second-guess’ the employer’s judgment in describing the essential requirements for the job.”
Harris v. Union Pac. R.R. Co., 953 F.3d 1030 (8th Cir. 2020). Plaintiff railroad employees brought class action against their employer, alleging that Defendant employer’s fitness-for-duty policy violated the ADA. Under Defendant’s policy, employees in certain positions had to report certain health events so that Defendant could determine the employee’s fitness for duty, and whether to assign certain job restrictions. Such events included heart attack, stroke, and significant vision change. The Eighth Circuit assumed, without deciding, that the class action hybrid certification approach of International Bhd. of Teamsters v. U.S., 431 U.S. 324 (1977) was applicable to ADA cases. Drawing attention to the highly individualized application of Defendant’s policy, the Court found that these individualized inquiries predominated over any common question, and thus the class could not be certified under 23(b)(2) and (b)(3). However, the Court noted that it was not rejecting the possibility that a class, which brought an ADA claim through the Teamsters framework, could properly be certified under Rule 23.
§ 15.3 Age Discrimination
§ 15.3.1 Burden of Proof / Evidentiary Issues / Damages
Babb v. Wilkie, 140 S. Ct. 1168 (2020). In an 8-1 decision, the Court vacated an Eleventh Circuit ruling that federal employees must show that an adverse employment action would not have happened if they were younger to succeed under Section 633a(a) of the ADEA, which states that public-sector employees “shall be made free from any discrimination based on age.” The case centers around Norris Babb, a clinical pharmacist for the U.S. Department of Veterans Affairs (VA). Babb claimed that because she was a woman over 40, the VA stripped her of her advanced certification, denied her a transfer and training opportunities, and shorted her on holiday pay. The Eleventh Circuit affirmed the dismissal of her lawsuit, holding that her claims did not satisfy the but-for standard. However, writing for the majority of the Court, Justice Alito explained that “if age discrimination played a lesser part in the decision, other remedies may be appropriate,” such as an injunction or other “forward-looking relief” that a district court sees fit to impose. In other words, “[t]he statute does not require proof that an employment decision would have turned out differently if age had not been taken into account”; instead, the “plain meaning” of the statute “demands that personnel actions be untainted by any consideration of age.” While the Court had held in a prior case that the private-sector provision of the ADEA requires plaintiffs to show that age was a but-for cause of an adverse employment action, Justice Alito noted that the private- and public-sector provisions have different terms, with the federal government held to a stricter standard than private employers or state and local governments.
Stoe v. Barr, 960 F.3d 627 (D.C. Cir. 2020). Plaintiff, a female Department of Justice (DOJ) employee, sued the US Attorney General, alleging that the agency’s decision to deny her a promotion and to give the job to a younger man (two decades her junior) with less experience was based on gender and age discrimination, in violation of Title VII and the ADEA. The district court granted summary judgment in favor of DOJ, and Plaintiff appealed. The D.C. Circuit reversed and remanded, holding that Plaintiff presented sufficient evidence for jurors to reasonably decide that the rationale offered by the DOJ for why it passed Plaintiff over for promotion was pretextual. The Court observed that the “caliber and quality” of Plaintiff’s evidence “surely supports” her contention that she was more qualified for the job than the younger comparator, and that jurors could conceivably side with her because of her “superior qualifications” and thus infer gender bias.
Green v. Town of E. Haven, No. 18-0143, 2020 WL 1146687 (2d Cir. (Conn.) Mar. 10, 2020). Dyanna L. Green appealed from a district court ruling dismissing her action against defendant Town of East Haven (“Town”) for alleged age discrimination in terminating her employment, in violation of the ADEA and Connecticut state law. The district court granted summary judgment dismissing the action on the sole ground that Green had failed to make out a prima facie case of any adverse employment action, because she had chosen to retire rather than attend a scheduled disciplinary hearing—the only merits-based challenge presented in the Town’s summary judgment motion. On appeal, Green asserted that the court erred in failing to view her evidence that the retirement was not voluntary but was coerced by the threat of likely termination, and hence constituted a constructive discharge. She explained that she resigned prior to the disciplinary hearing only after her union representative, who had just met with town representatives, told her she would almost certainly be fired. The Second Circuit agreed, finding that the evidence, viewed in the light most favorable to Green, sufficed to present genuine issues of fact as to whether a reasonable person in Green’s shoes would have felt compelled to retire. Accordingly, the Second Circuit vacated the judgment and remanded for further proceedings.
Stokes v. Detroit Pub. Sch., 807 Fed. App’x 493 (6th Cir. 2020). Plaintiff sued Defendant-employer, alleging violations of Title VII and the ADEA. The district court granted summary judgment to Defendant on all claims. Plaintiff worked for Defendant as an Interim Executive Director and applied for a newly created position Executive Director-Talent Acquisition (EDTA) when his contract ended. However, a 28-year-old female external applicant was routed to and preselected for the EDTA position by the managers who prescreened her. In response, Plaintiff filed suit. The Fifth Circuit found that Plaintiff could present a prima facie case for discrimination. Though the Defendant’s proffered reasons for the inconsistencies in their interview processes were found not to be pretextual, Plaintiff’s evidence that the external candidate was preselected created a genuine dispute as to why Plaintiff was not selected for the position. Thus, the Court reversed and remanded summary judgment to the Defendants on the Title VII and ADEA claims.
Pelcha v. MW Bancorp, Inc., 988 F.3d 318 (6th Cir. 2021). Plaintiff, an employee at Watch Hill Bank, was terminated purportedly for insubordination. Plaintiff, who was 47 years old at the time of her termination, sued under the ADEA, alleging age discrimination. The district court held she could not establish a prima facie case of age discrimination and granted summary judgment to Defendants. The Fifth Circuit noted that to defeat summary judgment, Plaintiff had to show a genuine dispute of material fact that could persuade a reasonable juror that age was the but-for cause of her termination. However, Plaintiff contended that Bostock, a Title VII case, disrupts this framework, and that the ruling in Bostock should be extended to change the meaning of “because of” under the ADEA. The Fifth Circuit rejected this argument, finding that Bostock narrowly applied to Title VII claims. Consequently, the Fifth Circuit analyzed Plaintiff’s claim using the existing ADEA framework and held that Plaintiff could not provide evidence of age discrimination. Because Plaintiff was unable to show that insubordination was only a pretext to conceal the true motive for her termination, the grant of summary judgment was affirmed.
Tyburski v. City of Chicago, 964 F.3d 590 (7th Cir. (Ill.) 2020). Plaintiff, a 74-year-old employee of the City Water Department, was rejected for a promotion after failing a verbal exam. Plaintiff brought non-promotion and hostile work environment claims against the City under the ADEA. Plaintiff alleged that the City improperly scored his verbal exam, and that it used his failing grade as pretext to deny him the promotion. The Seventh Circuit held that an employer is permitted to set necessary qualifications for an employment position, including scoring metrics, and that Plaintiff had not presented any evidence of pretext to explain the grading other than the interviewer’s knowledge of his age, which by itself is insufficient. Regarding Plaintiff’s claim that he was subjected to a hostile work environment based on three to four comments about his age from coworkers over the course of many years, the Seventh Circuit held that even assuming that a plaintiff could bring hostile work environment claims under the ADEA, Plaintiff failed to provide evidence that the treatment he received rose to the level of a hostile environment. The comments were allegedly made by his coworkers, not his supervisors, which would require a finding that the employer was negligent in failing to prevent harassment. To the contrary, the Court noted that Plaintiff’s employer made arrangements to prevent such comments from his coworkers.
Starkey v. Amber Enters., Inc., 987 F.3d 758 (8th Cir. 2021). Court held under the shifting burdens test of the ADEA, a plaintiff must first make out a prima facie case of age discrimination. Once plaintiff has done this, then the burden is on the defendant to articulate a legitimate, nondiscriminatory reason for its challenged action. If defendant proffers such a reason, the burden shifts back to plaintiff to show that the proffered reason was “mere pretext for discrimination” and that “age was the but-for cause” of the challenged adverse employment action. Here, Court assumed Plaintiff met her initial burden, and found that Defendant articulated a non-discriminatory reason (relying on business judgment based on third-party consultant recommendations). Court held that Plaintiff failed to meet its evidentiary burden to show the justification was merely pretext. Court found that Plaintiff’s evidence about other older employees who had their employment terminated: (1) was insufficient for the Court to assess the circumstances surrounding other employees’ terminations; (2) did not show that other employees were similarly situated to Plaintiff; and (3) did not show that discrimination against these employees was relevant to Plaintiff’s claim.
Main v. Ozark Health, Inc., 959 F.3d 319 (8th Cir. 2020). Plaintiff was unable to show that Defendant’s proffered reason for her employment termination was mere pretext. Defendant stated he terminated Plaintiff’s employment because she was rude and insubordinate at a meeting. Plaintiff attempted to show this reason was pretext by showing that this account of the meeting was false. Court reaffirmed that simply showing an employer’s explanation is false is insufficient to show pretext; what is important is whether the employer actually believed it, even if he was incorrect. Court further reaffirmed that showing an employer’s action was pretext is not enough to succeed on a claim under the ADEA. The plaintiff also must present evidence that permits a reasonable inference to be drawn that the real reason for the adverse employment action was the plaintiff’s age.
§ 15.3.2 Reductions in Force / Restructuring
There were no qualifying decisions this year.
§ 15.3.3 Miscellaneous
There were no qualifying decisions this year.
§ 15.4 Arbitration
§ 15.4.1 Claims Subject to Arbitration
MZM Constr. Co. Inc. v. N.J. Bldg. Laborers’ Statewide Benefit Funds, 974 F.3d 386 (3d (N.J.) 2020). The Third Circuit held that courts, not arbitrators, decide whether disputes are subject to arbitration if a contract’s language is vague. Questions about whether issues belong in arbitration “are for the courts to decide unless the parties have clearly and unmistakably referred those issues to arbitration in a written contrac t.” The parties had disagreed on whether MZM Construction Co. Inc. was contractually obligated to contribute $230,000 to the funds to pay ERISA benefits to workers on a Newark Airport construction project. The district court had stopped arbitration between the parties in December 2018, doubting the existence of a valid arbitration agreement while refusing to rule on the question of the agreement’s applicability. Before determining whether the agreement applied, the district court had to decide whether an arbitrator or the court should answer that question. The district court ruled that a court must resolve the question of whether an arbitration agreement applies before referring a matter to arbitration. The Third Circuit agreed, relying on Granite Rock Co. v. Int’l Bhd. of Teamsters, 561 U.S. 287 (2010).
Sabatelli v. Baylor Scott & White Health, 832 Fed. App’x 843 (5th Cir. 2020). After forcibly resigning from his job, Plaintiff sued Defendant in federal court, alleging that his forced resignation violated the ADEA and ADA. Sixteen months into the lawsuit, with summary judgment pending, Plaintiff filed an arbitration demand alleging Defendant breached the employment agreement. The district court granted summary judgment to the defendant on the discrimination claim and ruled that arbitration was no longer available for Plaintiff on his breach of contract claim. Using the McDonnell-Douglas framework, the Fifth Circuit reviewed the district court’s summary judgment dismissal of the discrimination claim and affirmed its dismissal. It found that there is not a factual dispute on whether Defendant’s reasons for Plaintiff’s termination were pretextual or on the question of causation. Next, the Fifth Circuit determined that a court decides whether Plaintiff can arbitrate his contract claim after pursuing his discrimination claims in federal court. The Court held that, because “the theory he seeks to arbitrate involves the same nucleus of operative facts as the ones pursued in federal court,” he is not permitted to “get a second bite at the apple through arbitration” after choosing to litigate his termination in federal court. The Fifth Circuit affirmed the district court’s decision on this issue.
Sun Coast Res., Inc. v. Conrad, 956 F.3d 335 (5th Cir. 2020). Plaintiff worked for Defendant Sun Coast Resources as an hourly fuel technician and driver. On behalf of a class of similarly situated employees and pursuant to an arbitration agreement, Plaintiff brought overtime claims against Defendant alleging violations of the FLSA. The arbitrator used the clause construction award and determined that the arbitration agreement provided for collective actions. The district court denied Defendant’s request to vacate the award and held that the arbitrator interpreted the agreement properly. The Fifth Circuit reviewed de novo and affirmed the district court’s decision. The Fifth Circuit agreed with the arbitrator and the district court that Defendant’s arbitration agreement covered a breadth of claims, and that Defendant’s decision not to exclude class arbitration was a conscious choice. Additionally, the Court agreed that the American Arbitration Association’s rules for employment would govern the arbitration and those rules permit class proceedings. Therefore, a class proceeding was appropriate in this case. Finally, the Court noted that Defendant twice forfeited the issue of whether the arbitrator determines class arbitrability by not challenging the issue to the arbitrator and not challenging the arbitrator’s authority in a timely manner to the district court. The Fifth Circuit held that the class action could proceed.
Krakowski v. Allied Pilots Ass’n, 973 F.3d 833 (8th Cir. 2020). Plaintiff pilot sued his union in state court. Defendant union argued that under the Railway Labor Act, these disputes must be made before an adjustments board. The Eighth Circuit held that claims between only the union and its members (without involving the employer) are not subject to the Railway Labor Act’s requirement that claims be arbitrated in front of an adjustment board.
§ 15.4.2 Enforceability
Teamsters Local 177 v. United Parcel Serv., 966 F.3d 245 (3d Cir. (N.J.) 2020). A labor union petitioned for an order confirming an arbitration award in the union’s favor, pursuant to the Federal Arbitration Act (FAA) and the Labor Management Relations Act with respect to work assignment grievances brought under a CBA. The district court denied the union’s motion to confirm and dismissed the case, and the union appealed. The Third Circuit reversed and remanded, ruling that the arbitration award must return to the district court for confirmation. This decision resolved a circuit split over whether district courts have jurisdiction over such awards when they are not disputed. Here, the Court rejected UPS’s argument that the FAA requires there to be a case or controversy over an award before a district court can get involved. “Confirmation is the process through which a party to arbitration completes the award process under the FAA, as the award becomes a final and enforceable judgment. The FAA not only authorizes, but mandates, that district courts confirm arbitration awards by converting them into enforceable judgments through a summary proceeding.”
Bigger v. Facebook, Inc., 947 F.3d 1043 (7th Cir. 2020). Plaintiff, an employee of Facebook, brought a putative collective action under the FLSA against Facebook, alleging that he was improperly classified as overtime exempt. One of the issues before the Seventh Circuit was whether the district court abused its discretion by authorizing notice of the class action to be sent to individuals who allegedly entered mutual arbitration agreements, waiving their right to join the action. Facebook argued that sending notice to such individuals would misinform them. Plaintiff countered that all employees in the proposed collective action are “potential plaintiffs” because they were all victims of a policy that violated the law. The Seventh Circuit vacated and remanded the district court’s authorization of notice. The Court justified not authorizing notice to individuals who have entered arbitration agreements based on (1) the risk of increasing pressure to settle by adding plaintiffs and (2) preventing the appearance of soliciting claims. The other issue before the Seventh Circuit was whether Plaintiff had a viable claim that she should not be overtime exempt. The Seventh Circuit affirmed that issues existed as to whether Plaintiff should be categorized as exempt. First, the Seventh Circuit affirmed that a genuine question of fact existed as to whether Plaintiff customarily and regularly performed administratively exempt duties. While her core function as a revenue generator through advertisements was an administratively exempt duty, her engagement in that function may not have been. Secondly, the Seventh Circuit affirmed that a genuine question of fact existed as to whether she had authority to make an independent choice, free from supervision, which would have made her overtime exempt.
In re Grice, 974 F.3d 950 (9th Cir. 2020). The Ninth Circuit affirmed a district court’s decision holding that rideshare drivers who pick up and drop off passengers at airports do not fall within arbitration exemption for workers engaged in foreign or interstate commerce. In doing so, the Court examined Section 1 of the Federal Arbitration Act, also referred to as the Act’s residual clause, which exempts from the Act’s coverage contracts of employment of workers engaged in foreign or interstate commerce. The Court acknowledged that the 3rd and 1st Circuits interpreted the residual clause to apply to those who transport passengers while engaged in interstate commerce. However, the Court noted that the critical factor was “the nature of the business for which a class of workers perform[ed] their activities.” In doing so, the Ninth Circuit noted that a district court had previously concluded that Lyft drivers were not engaged in interstate commerce because the company was primarily in the business of providing rides—most of which were intrastate—not offering interstate transportation to passengers. The Court concluded that because rideshare drivers “[were] not part of a group engaged in foreign or interstate commerce,” they do not fall within the FAA’s residual clause exemption.
Gherardi v. Citigroup Global Markets, Inc., 975 F.3d 1232 (11th Cir. (Fla.) 2020). The Eleventh Circuit reversed and remanded a district court decision that determined arbitrators “exceeded their powers” in awarding the plaintiff-employee nearly $4 million for wrongful termination. The employee had initiated arbitration against Citigroup, alleging that his termination had violated an anti-retaliation provision of his employment contract. Citibank countered that the employee was at-will and thus could be terminated for any reason. The Eleventh Circuit held that, because the discharged employee’s wrongful termination claim was “employment-related,” it was validly submitted to arbitrators pursuant to the terms of Citigroup’s arbitration policy specifying that the parties agreed to arbitrate all “employment-related disputes.” Accordingly, the district court erred by substituting its own legal judgment for that of the arbitrators. The Court emphasized that arbitrators do not exceed their authority by making an error, even a serious error. Rather, under the Federal Arbitration Act, 9 U.S.C. § 10(a)(4), the employee’s claim was “assigned by contract” to arbitrators, meaning that the courts had no power to rule on the merits of the underlying claim for wrongful termination, unless there is evidence that the arbitrators strayed from interpretation of the contract between the parties. “In short, if an agreement assigns a dispute to arbitration, the arbitrators do not exceed their authority when they resolve that dispute—regardless of the outcome.” Gherardi reflects a refusal by the Eleventh Circuit to expand Section 10(a)(4)’s “exceeded their powers” basis for vacating an arbitration award, even in situations where enforcement of the Federal Arbitration Act would result in clear legal error.
§ 15.5 Title VII
§ 15.5.1 Burden of Proof / Evidentiary Issues
Joll v. Valparaiso Cmty. Schs., 953 F.3d 923 (7th Cir. 2020). Plaintiff, an accomplished female runner and experienced runner, applied for two assistant coaching positions at Valparaiso High School, one for the girls’ cross-county team and one for the boys’ cross-country team. Plaintiff was not selected for either position and, in both instances, a younger male was hired. Plaintiff filed suit under Title VII and the ADEA. The district court granted summary judgment for the defendant concluding that plaintiff had not offered enough evidence of either form of discrimination to present the case to a jury. However, the Seventh Circuit reversed the district court’s grant of summary judgment in favor of defendants, reasoning that the district court failed to look at the totality of the circumstances. The Seventh Circuit held that a jury could reasonably find that the defendants skewed the rules in favor of the male candidates to the plaintiff’s detriment. The plaintiff had a more difficult time securing an initial interview than her male counterparts, and during her interview, plaintiff was asked if she was capable of committing to her job despite having children, while her male counterparts were asked about their past experiences. The Seventh Circuit found that this was suggestive of a sex stereotype that women should play a more domestic role than men. Also, defendants checked the plaintiff’s references immediately following her interview, rather than wait until after school officials decided to make a hiring recommendation to the school board, as was the defendants’ past practice and as they did with the male applicants. Also, despite receiving positive feedback from most of her references, defendants decided to turn her down based on one line from one reference that mentioned that plaintiff had a “dominant personality,” which the court also found suggestive of a sex stereotype that women should be more subordinate. Furthermore, the court found that the defendants’ stated reasons for hiring for these identical positions were inconsistent with each other, as they emphasized the importance of recent coaching experience for one position while not mentioning such a requirement for the other, instead mentioning that the male candidate was hired for having “rapport with the boys”. The Seventh Circuit remanded the case for trial on the sex discrimination claim.
Gibson v. Concrete Equip. Co., 960 F.3d 1057 (8th Cir. 2020). Plaintiff brought a sexual harassment claim, among others, against Defendant employer. The Eighth Circuit affirmed a district court grant of summary judgment in favor of Defendant on Plaintiff’s sexual harassment claim, finding that she failed to establish a prima facie case. The Court found that Plaintiff failed to establish that the harassment affected a term, condition, or privilege of Plaintiff’s employment. Specifically, the Court held that Plaintiff’s claim failed because she was unable to demonstrate that she subjectively perceived the alleged harassment as abusive. In support of this conclusion, the Court noted that Plaintiff had stated, in a letter to an individual investigating her post-termination complaint, that she loved working at the company, that her coworkers were akin to brothers and uncles that she had never had, and that she was rarely offended by her coworkers’ conduct. Furthermore, the Court cited evidence that Plaintiff engaged in behavior similar to that which she claimed was unwelcome or offensive on multiple occasions, “demonstrate[ing] that the behavior of the accused employees was not unwelcome.”
§ 15.5.2 Damages / Attorneys’ Fees
Sooroojballie v. Port Auth. of N.Y. & N.J., 816 Fed. App’x 536 (2d Cir. 2020). Plaintiff Neil Sooroojballie commenced a Title VII and Section 1981 suit against his former employer, The Port Authority of New York & New Jersey, and his supervisor Gary Frattali, alleging employment discrimination on the basis of his race and national origin. In 2018, a jury found in favor of Sooroojballie on his hostile work environment claim and awarded him $2,160,000 in compensatory damages and $150,000 in punitive damages. Defendants appealed. The Second Circuit determined that there “was more than sufficient evidence for the jury to find that Sooroojballie was subjected to a hostile work environment based upon his race and national origin, and thus the jury’s finding must not be disturbed.” However, the Court noted that Sooroojbalie’s “proof regarding emotional distress did not contain the evidence or prolonged mental harm or negative, long-term prognosis that is typically present in cases with awards around $500,000.” As a result, the Court determined that the jury’s $2,160,000 award for emotional distress damages “far surpasses the upper limit of the reasonable range and shock(s) the judicial conscience.” The Court set $250,000 as “the upper limit of the reasonable range for the significant emotional distress that was described in Sooroojballie’s testimony.” The Court also upheld the $150,000 punitive damages award.
§ 15.5.3 Gender / Equal Pay Act
Bostock v. Clayton Cty., 140 S. Ct. 1731 (2020). In a landmark opinion that consolidated three separate cases—EEOC v. R.G. & G.R. Harris Funeral Homes, 884 F.3d 560 (6th Cir. (Mich.) 2018); Bostock v. Clayton Cty. Bd. of Comm’rs, 723 Fed. App’x 964 (11th Cir. (Ga.) 2018); and Zarda v. Altitude Express, Inc., 883 F.3d 100 (2d Cir. (N.Y.) 2018)—the Supreme Court held that Title VII prohibits discrimination on the basis of sexual orientation, gender identity, and transgender status. According to the Court, “[b]ecause discrimination on the basis of homosexuality or transgender status requires an employer to intentionally treat individual employees differently because of their sex, an employer who intentionally penalizes an employee for being homosexual or transgender also violates Title VII.” The 6-3 decision, penned by Justice Gorsuch, resolved a contentious circuit split over how far Title VII’s prohibition on discrimination “because of sex” extends. Bostock came on the heels of several notable lower-court decisions that expanded the protections of Title VII, such as Hively v. Ivy Tech Cmty. Coll. Of Ind., 853 F.3d 339 (7th Cir. (Ind.) 2017) (holding that Title VII gives gay and lesbian workers the right to sue over what they perceive as discriminatory employment practices based on their sexual orientation). In Zarda, an en banc Second Circuit determined that the estate of a gay skydiving instructor had a viable claim against Altitude Express Inc. The same year, the Sixth Circuit in R.G. & G.R. Harris Funeral Homes revived the EEOC’s allegations that the employer had illegally fired its funeral director after she announced her gender transition. The funeral home and the skydiving company appealed their losses to the Supreme Court, along with gay former Georgia municipal worker Gerald Bostock, who had lost his unfair firing case at the Eleventh Circuit. The Court granted certiorari in April 2019 and heard the combined cases in October 2019. How the Bostock ruling applies to faith-based employers who believe that homosexuality and same-sex marriage run counter to their religious beliefs remains an open question. For his part, Justice Gorsuch wrote that the extent to which “these doctrines protecting religious liberty interact with Title VII are questions for future cases.”
Spencer v. Va. State Univ., 919 F.3d 199 (4th Cir. 2019). Plaintiff, a female sociology professor, argued that her position was substantially equal to that of two male professors who taught in completely different departments. According to the plaintiff, all professors, regardless of academic field, performed substantially equal work because they all prepared syllabi and lessons, managed their classrooms, instructed students, tracked student progress, and input grades. The district court disagreed and granted summary judgment in favor of the defendant. The Fourth Circuit affirmed the grant of summary judgment, in large part because plaintiff’s claim of “equal work” rested on a level of generality insufficient to sustain a prima facie case. In particular, the Court noted that plaintiff’s claims failed because they were so general in description as to be “shared by middle-school teachers and law-school professors, pre-algebra teachers and biomedical-engineering professors” alike. Essentially, plaintiff’s comparison failed because it relied on the “common title of professor” and “generalized responsibilities,” and did not account for differences in skill and market forces that compensate certain types of professors more highly.
Pribyl v. Cnty. of Wright, 964 F.3d 793 (8th Cir. 2020). The Eighth Circuit affirmed a district court grant of summary judgment in favor of Defendant employer, concluding that Plaintiff, a job candidate applying for employment with Defendant, failed to raise a genuine issue of material fact in support of her Title VII claim of sex discrimination. Among Plaintiff’s arguments was that a reasonable jury could find Defendant liable under a cat’s paw theory, under which an employer could be held vicariously liable for an adverse employment action if an agent—other than the ultimate decision-maker—was motivated by discriminatory animus and intentionally and proximately caused the action. The Eighth Circuit concluded that Plaintiff failed to provide any evidence that Defendant’s agents—an interview panel—harbored gender animus, particularly in light of the fact that the panel asked no gender-specific question and that the Plaintiff herself had introduced a gender-based issue through her answer. The Court further rejected Plaintiff’s contention that the ultimate decision-maker in the hiring process harbored gender animus sufficient to warrant liability under a cat’s paw theory, noting that the gender animus of a final decision-maker could not be the basis of a cat’s paw theory; rather, such animus was more properly classified as direct evidence of sex discrimination—an argument that Plaintiff had already waived.
Rizo v. Yovino, 950 F.3d 1217 (9th Cir. 2020). Plaintiff, a female county employee, filed suit against her employer under the Equal Pay Act. She argued that the county violated the EPA by using prior wages to calculate her starting salary as a math consultant, which resulted in a salary that was significantly lower than starting salaries for her male coworkers who performed the same work. The Ninth Circuit examined the scope of the EPA’s fourth exception, which allows a disparity in pay where such differential is “based on any other factor than sex.” After examining the text of the Act, considering the canons of statutory construction, and examining the EPA’s history and purpose, the Court ultimately concluded that this fourth exception to the EPA was limited only to job-related factors. The Court went further to overrule Kouba v. Allstate Ins. Co., 691 F.2d 873 (9th Cir. 1982), in which it had previously allowed the use of prior pay as an affirmative defense to an EPA claim. In light of its interpretation of the EPA’s fourth exception, the Court concluded that, because prior pay potentially carried the effects of sex-based pay discrimination, an employee’s prior salary did not qualify as a factor other than sex under the fourth exception.
Frappied v. Affinity Gaming Black Hawk, LLC, 966 F.3d 1038 (10th Cir. 2020). Plaintiffs were all employees of a casino who were laid off by Defendant. The eight female Plaintiffs brought sex-plus-age disparate impact and disparate treatment claims under Title VII, and all Plaintiffs brought disparate impact and disparate treatment claims under the ADEA. The district court granted summary judgment in favor of Defendant, and Plaintiffs appealed. The Tenth Circuit affirmed in part and reversed in part. First, in an issue of first impression, the Tenth Circuit recognized that Plaintiffs’ sex-plus-age disparate impact claims were cognizable under Title VII, and the district court had erred in dismissing such claims. However, because Plaintiffs had failed to allege or plausibly infer that Defendant had discriminated against them because of sex, their Title VII disparate treatment claims were properly dismissed. Next, the Tenth Circuit reversed the dismissal of Plaintiffs’ ADEA disparate impact claims, reasoning that Plaintiffs had sufficiently alleged that Defendant’s termination policies resulted in a disparate impact on workers who were forty or older. Finally, the Tenth Circuit held that there existed a genuine issue of fact regarding Plaintiffs’ ADEA disparate treatment claims, where there was sufficient evidence for a jury to conclude that Defendant lacked credibility regarding its purported non-discriminatory reasons for terminating Plaintiffs, and that these reasons were pretextual.
Durham v. Rural/Metro Corp., 955 F.3d 1279 (11th Cir. (Ala.) 2020). The Eleventh Circuit revived a pregnancy bias lawsuit by an EMT denied light-duty work while pregnant in the Circuit’s first application of Young v. UPS, 575 U.S. 206 (2015), which articulated the standard for establishing a prima facie case of pregnancy discrimination under the Pregnancy Discrimination Act. In 2015, Kimberlie Durham became pregnant while working as an emergency medical technician for Rural/Metro. Her physician instructed her not to lift more than 50 pounds during her pregnancy. When Rural/Metro denied her request for accommodation, Durham sued them in Alabama federal court, alleging discrimination. The district court granted Rural/Metro’s motion for summary judgment, concluding that Durham had failed to establish a prima facie case of discrimination under the Pregnancy Discrimination Act. Durham appealed, and the Eleventh Circuit held that the district court “mistakenly determined” that pregnant and non-pregnant employees in need of workplace accommodations could be treated differently. Under Young, a plaintiff need only show that (1) she is a member of the protected class, (2) she requested and was denied accommodation, and (3) her employer accommodated others “similar in their ability or inability to work.” Here, the district court erroneously factored into its analysis Rural/Metro’s purportedly legitimate reason for treating the EMT differently from non-pregnant workers, a factor that should be considered only after the prima facie analysis. The Court remanded the action to the district court for it to reevaluate “whether [Rural/Metro’s] stated reasons for treating Durham differently than other EMTs with lifting restrictions were pretextual.”
§ 15.5.4 Harassment / Reporting Harassment
Lewandowski v. City of Milwaukee, 823 Fed. App’x 426 (7th Cir. (Wis.) 2020). Plaintiff, a former police officer, alleged that the Milwaukee Police Department violated Title VII by discriminating against her on the basis of sex and retaliating against her. Plaintiff had helped another female officer obtain a temporary restraining order against her friend’s abusive partner, who was a high-ranking male police officer. Plaintiff alleged that her help and support of her friend angered the higher-ups within the department, where they began to retaliate against her. Following an on-duty incident, Plaintiff was suspended and then terminated for lying. The Seventh Circuit held that Plaintiff had not established a prima facie case of sex discrimination because she failed to show that a similarly situated male employee had been treated more favorably. Plaintiff asserted that male employees who had committed worse offenses had not been terminated, yet she failed to show evidence of a proper comparator similar in rank, dates of employment, and details as to the misconduct. Regarding the retaliation claim, the Seventh Circuit determined that Plaintiff had failed to show any statutorily protected activity, such as a formal complaint alleging sex discrimination. The Court noted that, despite Plaintiff’s complaints about her general mistreatment resulting from her helping her friend, not every complaint from a woman to management is protected under Title VII unless it specifically alleges sex discrimination.
Paskert v. Kemna-ASA Auto Plaza, Inc., 950 F.3d 535 (8th Cir. 2020). Plaintiff, a female employee, brought an action against employer and supervisors, asserting claim for hostile work environment based on sex, among other claims. The Eighth Circuit cited several cases within the circuit in which the Court held that the facts were not sufficiently severe or pervasive enough to establish a Title VII hostile work environment claim—McMiller v. Metro, 738 F.3d 185 (8th Cir. 2013); LeGrand v. Area Resources for Community and Human Services, 394 F.3d 1098, 1100-03 (8th Cir. 2005); and Duncan v. General Motors Corporation, 300 F.3d 928, 931-35 (8th Cir. 2002). Relying on precedent set by these cases, the Court concluded that the behavior of Plaintiff’s supervisor, “while certainly reprehensible and improper, was not so severe or pervasive as to alter the terms and conditions of [Plaintiff’s] employment,” which was required to support a claim for sexual harassment. The Court went further in distinguishing Plaintiff’s case from that of the plaintiffs in McMiller, LeGrand, and Duncan, noting that Plaintiff “only alleges one instance of unwelcome physical contact, one or two statements where [the offender] stated he could ‘have [her],’ and several statements about how he never should have hired a female and wanted to make [her] cry.’” Acknowledging that such behavior was inappropriate, the Court nevertheless concluded that it was “not nearly severe or pervasive as the behavior found” in the previously cited cases. As a result, the Eighth Circuit affirmed the district court’s grant of summary judgment in favor of Defendant.
Allen v. Ambu-Stat, LLC, 799 Fed. App’x 703 (11th Cir. (Ga.) 2020). The Eleventh Circuit affirmed a district court’s dismissal of a former employee’s Title VII sexual harassment claim. The employee had sued Ambu-Stat for sexual harassment and retaliation, negligent hiring, intentional infliction of emotional distress, invasion of privacy, and ratification. The district court granted summary judgment to Ambu-Stat on the employee’s federal claims and refused to exercise supplemental jurisdiction over her state law claims. According to the Eleventh Circuit, the employee’s action failed because no reasonable jury could have found the complained-of conduct—five crude, sexually charged comments made over a period of four months—to have been pervasive harassment under Title VII’s “severe or pervasive” standard. After determining that the conduct in question was not “pervasive,” the Court did not delve into whether the complained-of conduct was “severe,” finding that the employee’s counsel had abandoned such argument at oral argument. The Court further observed that these comments appeared to have been said in a joking manner. The Eleventh Circuit also upheld the dismissal of the employee’s Title VII retaliation claim, holding that she did not show that she engaged in statutorily protected activity prior to her termination. The employee did not identify any instance where she acted in opposition to an unlawful employment practice, and a single note written to Ambu-Stat did not constitute a protected activity since it was “unambiguously an extended apology” to the company. For employers in the Eleventh Circuit, Ambu-Stat is an additional guidepost to evaluate whether conduct is unlawfully “pervasive” harassment, and it holds that merely discussing an incident with a decision-maker does not necessarily constitute “opposition” for the purposes of Title VII.
§ 15.5.5 National Origin Discrimination
Vega v. Chicago Park District, 954 F.3d 996 (7th Cir. (Ill.) 2020). Plaintiff, a former Hispanic park district supervisor, sued the park district under Title VII, alleging national-origin discrimination for alleged timesheet falsification. The park district received an anonymous call accusing plaintiff of “theft of time”, which meant clocking in hours that plaintiff had not worked. In response, the park district hired an investigator to surveil plaintiff’s car. The park district soon hired another investigator and over the course of 56 days, plaintiff was surveilled over 252 times, often disrupting plaintiff during her work to ask investigative questions in front of coworkers. The investigators eventually met with plaintiff and her union representative but were allegedly dead set on their conclusion that plaintiff had violated the park district’s code of conduct. Without consulting plaintiff’s supervisor or recommending a progressive discipline, the park district fired plaintiff for timesheet falsification. The Seventh Circuit affirmed the district court’s denial of the employer’s motion for judgment as a matter of law under Title VII. Plaintiff had shown sufficient circumstantial evidence that she was an effective employee for over 20 years and was promoted several times. The sudden jump to termination despite her favorable record was probative of discriminatory intent. Plaintiff also exposed several material errors in the park district’s investigation, such as that they surveilled the wrong car. Plaintiff also provided testimony that the park district regularly mistreated Hispanic employees, such as by placing them in “rough” parks intentionally, imposing harsher discipline on them, and conducting harsher investigations on them. The Seventh Circuit also affirmed the district court’s decision to remit plaintiff’s compensatory award to $300,000, the statutory maximum for Title VII claims, based on plaintiff’s testimony detailing extensive distress.
Fernandez v. Trees, Inc., 961 F.3d 1148 (11th Cir. (Fla.) 2020). The Eleventh Circuit revived a Title VII hostile work environment case brought by Alexis Soto Fernandez, a Cuban tree trimming worker, who was terminated after trying to kill himself on the job. According to the Court, Fernandez “provided evidence sufficient to raise a material issue of fact whether the harassment was objectively severe or pervasive.” For example, Fernandez’s complaint alleged that his supervisor made derogatory comments about Cubans on an almost daily basis, including calling them “crying, whining Cubans” and declaring a “new policy in the company, no more Cuban people.” After two months of this hostility, Fernandez tried to take his own life at work; afterwards, he was terminated and his coworkers allegedly were forced to sign a statement disavowing that they had heard any discriminatory or harassing comments directed towards Trees, Inc. employees. Based on these allegations, the Eleventh Circuit held that Fernandez had demonstrated that the supervisor’s conduct was sufficiently humiliating to support his claim. The Court upheld the district court’s grant of summary judgment on Fernandez’s national origin discrimination claim, observing that the supervisor’s statements about Cubans were not direct evidence that Fernandez was fired because of his national origin.
§ 15.5.6 Race Discrimination
Comcast v. National Association of African American-Owned Media, 140 S. Ct. 1009 (2020). In a unanimous decision, the Court held that the but-for standard of causation applies to race discrimination claims under 42 U.S.C. § 1981. In other words, a claim of race discrimination under Section 1981 fails in the absence of but-for causation, a higher burden than the “motivating factor” standard that the Ninth Circuit Court of Appeals had permitted in its 2018 decision that cleared the bias case to proceed. The Court consistently has ruled that the but-for test is required to evaluate claims brought under anti-discrimination statutes, and it refused to recognize an exception for Section 1981 claims. The Court declined to address Comcast’s argument that the statute only protects against discrimination in a final contracting decision and does not cover earlier stages of the contract-formation process. The Court’s decision returned the $20 billion lawsuit to the Ninth Circuit, for it to determine whether discrimination was the defining feature in the disputed contracting decision between Comcast and Entertainment Studios, owned by African American comedian Byron Allen. Entertainment Studios alleged that Comcast has refused to carry its channels due to Allen’s race. Entertainment Studios ended up settling with Comcast in June 2020. However, the company also had filed a similar, $10 billion race bias lawsuit against Charter Communications Inc., alleging that the refusal to carry some of its channels was an example of “structural, systemic racism.” In August 2020, several months after the Comcast decision, the U.S. District Court for the Central District of California concluded that Entertainment Studios’ claims against Charter survived the heightened but-for standard, at least at the pleadings stage.
Jeffries v. Barr, 965 F.3d 843 (D.C. Cir. 2020). Plaintiff, an African American employee of the Department of Justice (DOJ), sued under Title VII, alleging race and sex discrimination and retaliation. Plaintiff claimed that his non-selection for seven different promotion opportunities within DOJ violated federal law. The district court denied Plaintiff’s motion to take discovery and granted DOJ’s motion for summary judgment. On appeal, the D.C. Circuit found that Plaintiff should have been allowed to take discovery for one of the seven instances in which he allegedly was wrongly passed over for promotion. Unlike with the other six instances—where Plaintiff failed to show that the legitimate, nondiscrimatory reasons proffered by the agency for not selecting him for certain positions were pretextual—for the seventh instance “the district court abused its discretion in denying the motion, as the denial was premised in part on an erroneous view that the discovery sought about the priority consideration was ‘irrelevant.’” The Court noted that there was an “unexplained deviation” from the agency’s standard practices in that first instance that could “justify an inference of discriminatory motive,” and that the district court’s error was not harmless given other evidence in the record.
Smith v. Sec’y U.S. Navy, 2021 U.S. App. LEXIS 2500 (3d Cir. (Pa.) Jan. 29, 2021). The Third Circuit rejected the appeal of an African American contractor, whose Title VII lawsuit claimed that the U.S. Navy’s logistics unit denied him training opportunities that were offered to other civilian workers and fired him because of his race. The Court agreed with the district court that the contractor had failed to show that non-African American employees received preferential treatment. In addition, the Court determined that the contractor “did not put forth evidence that his termination occurred under circumstances that give rise to an inference of unlawful race discrimination.” The Court also took issue with the examples that the contractor pointed to as evidence of disparate treatment, noting that two white coworkers who allegedly received more training were hired on a rotating shift and at different pay grades than the contractor. While the Third Circuit did agree that the contractor’s retaliation claim appeared plausible, it found that Navy Supply had initiated the process for terminating him at least two months before he raised his discrimination complaint. Finally, the Court dismissed the contractor’s allegation of hostile work environment, finding that at the time of the disputed incidents he had not alleged racial animus on the part of the employees assigned to train him, and that the contractor’s supervisor had tried to defuse the situation by reassigning the employees.
Sorto v. Autozone, Inc., 821 Fed. App’x 188 (4th Cir. 2020). Plaintiff worked for Defendant as a sales associate. Shortly after he began, the store was robbed while Plaintiff was working. The store manager accused Plaintiff of being a conspirator in the robbery. In the months that followed, the manager blamed Plaintiff when items were misplaced in the store, commenting, “I know how all you Latinos are.” Approximately six months later, another manager remarked that the plaintiff “stinks and smells like sheep,” which sparked a pattern of sheep-related mockery that continued throughout Plaintiff’s employment at the store. Plaintiff was later transferred to another store, where he also received insults from the other employees. Plaintiff reported the insults to the store’s assistant manager and to an HR representative, but Defendant took no action. A week after Plaintiff informed his managers that he would be absent to file a hostile work environment complaint with the EEOC, his employment was terminated. The Fourth Circuit affirmed the district court’s dismissal of Plaintiff’s complaint. The Court held that the isolated references to Plaintiff as a Latino—implying that he was untrustworthy—and Mexican—in regard to his long hair—were made over four years apart and in two different workplace locations, and thus cannot be the basis for a workplace “permeated with discriminatory intimidation.” Further, the Court held that the remaining insults could not be attributable to race-based discrimination; neither “sheep” nor “Hello Kitty” are commonly associated with people of Hispanic origin, and comments implying that he was effeminate or gay were unrelated to race.
Young v. Montgomery Cnty., No. CBD-18-2054, 2020 WL 5626583 (D. Md. Sep. 14, 2020). Plaintiff filed a complaint against Defendant-Employer alleging race and gender discrimination in violation of Title VII. Plaintiff, an African American correctional officer, alleged that Defendant discriminated against him when it reassigned him to a high-risk area while reassigning another, similarly situated and less-qualified white officer to a low-risk area. The District Court granted Defendant’s summary judgment motion, finding that the reassignment did not affect Plaintiff’s pay, grade, benefits, or responsibilities, and thus was not an adverse employment action. Plaintiff argued that the reassignment was more hazardous to his physical, mental, and emotional health. The Court rejected this argument, noting Plaintiff’s own testimony that, “When you walk into a correctional facility, it’s—once you step through the door, it’s very risky. So you always have a level [of] risk that you’re going to experience.” The Court reasoned that while it may have been true that the reassigned position was more stressful and carried a slightly higher degree of risk, it noted that certain occupations are expected to have a heightened degree of risk. When in these heightened risk occupations, reassignment to a position carrying a greater degree of risk that the employee has already agreed to tolerate, and has been trained to tolerate, is merely a foreseeable stage in the progression of the employee’s career and not an adverse employment action.
Barnes v. Bd. of Trs. of the Univ. of Ill., 946 F.3d 384 (7th Cir. (Ill.) 2020). Plaintiff, an African American engineer in the facilities management department of a university, applied for and was selected to interview for a promotion. A white engineer was selected for the position instead of plaintiff. Plaintiff sued the employer for non-promotion on the basis of race. Plaintiff argued that he was more qualified for the position because of his years of experience in engineering, customer service, and various mechanical systems. Plaintiff also argued that he had a higher performance review than the chosen candidate. The Seventh Circuit affirmed that the employer had provided a legitimate non-discriminatory reason for plaintiff’s non-promotion. The court found that the employer had considered only the interviews of the candidates, which it was entitled to do. The hired white candidate had come fully prepared to the interview with extensive materials and thoughtful answers, while plaintiff showed up empty handed and was not as specific in his answers. The court also found that plaintiff failed to show any evidence to suggest that the employer lied about its legitimate non-discriminatory reason, thereby failing to show pretext.
Carter v. Pulaski Cnty. Special Sch. Dist., 956 F.3d 1055 (8th Cir. 2020). Plaintiff, a black former cheerleading and dance teams coach, brought action against her former employer following non-renewal of her coaching contract, alleging claims of employment discrimination under Title VII, among other claims, on the basis of race. Plaintiff alleged that the circumstances gave rise to an inference of discrimination because a similarly situated white cheerleading coach was treated differently. However, the Eighth Circuit rejected this argument. It noted that Plaintiff was removed from her duties in part due to multiple complaints about her team’s routines being inappropriate, whereas there only was evidence of one complaint against the white coach’s routines. Furthermore, Plaintiff was removed based on two other reasons as well—low participation rates and team misconduct while traveling; on the other hand, there was no evidence that the white coach had similar issues. As a result, Plaintiff failed to show that she was similarly situated in all relevant respects to her white former coworker. The Eighth Circuit affirmed the district court’s grant of summary judgment in favor of Defendant.
Findlator v. Allina Health Clinics, 960 F.3d 512 (8th Cir. 2020). Plaintiff brought suit against her employer, alleging claims for discrimination on the basis of race and national origin. Plaintiff, who is black, developed conflict with her white coworker. The coworker made a comment about Plaintiff being in a gang, which comment Plaintiff reported to her supervisors. During a heated argument between Plaintiff and her coworker, the coworker threw her lab coat in Plaintiff’s direction twice. In response, Plaintiff placed her hands on her coworker’s shoulders and pushed her. Following a human resources investigation, Plaintiff was cited for violating three company policies, including the Violence-Free Workplace policy, and terminated. Her coworker was cited for violating two of the same policies and issued a suspension and a final warning. Because the investigation found that the coworker’s lab coat did not hit Plaintiff, she was not cited for violating the Violence-Free Workplace policy. Plaintiff argued that she presented direct evidence of discrimination, including: (1) Defendant employer’s consideration of Plaintiff’s race during its investigation; (2) Coworker’s comment that Plaintiff was in a gang; and (3) Defendant’s failure to cite the coworker for violation of the Violence-Free Workplace policy. The Eighth Circuit rejected Plaintiff’s arguments, noting that the record demonstrated that Defendant considered Plaintiff’s race only to ensure that any corrective action was not based on racial discrimination. Further, it concluded that the coworker’s comment about Plaintiff belonging to a gang was insufficient to demonstrate discrimination because she was merely a coworker with no authority to terminate Plaintiff. Lastly, the Court found that because Plaintiff and her coworker engaged in different types of misconduct and were not similarly situated, Defendant’s decision not to cite the coworker for violation of the Violence-Free Workplace policy did not constitute disparate treatment sufficient to sustain her claim for discrimination.
Gipson v. Dassault Falcon Jet Corp., 983 F.3d 377 (8th Cir. 2020). Plaintiff, a black senior manufacturing engineer, lost his job in a 2017 workforce reduction and brought race discrimination and retaliation claims against his former employer. Plaintiff claimed that a previous denial of promotion and eventual layoff were retaliation for lodging racial bias complaints in 2011 and 2015. The Eighth Circuit upheld a lower court decision granting summary judgment to Defendant, saying that Plaintiff failed to show a link between his complaints lodged with the EEOC and Defendant denying him a promotion or letting him go. The Eighth Circuit noted that the company’s extensive force reduction, objective methods used in paring down its work force, a lack of direct evidence tying Plaintiff’s EEOC complaint to his termination, and a failure to show a connection between events that occurred years apart, worked in Defendant’s favor.
§ 15.5.7 Retaliation Claims
Simmons v. UBS Fin. Servs., 972 F.3d 664 (5th Cir. 2020). Plaintiff sued Defendant UBS Financial Services under Title VII, alleging retaliation. Plaintiff was employed by Prelle Financial Group, a client of Defendant, and frequently worked out of its offices. His daughter, who was employed by Defendant, submitted an internal complaint of pregnancy discrimination and filed a charge with the EEOC. She eventually resigned and settled her claims with Defendant. Plaintiff alleged Defendant retaliated against him and revoked his right of access to its offices and forbade him from doing business with its clients following his daughter’s complaints. The district court agreed with Defendant’s assertion that Plaintiff could not sue Defendant under Title VII because he was not an employee of Defendant and dismissed the Plaintiff’s suit. The Fifth Circuit reviewed the dismissal de novo. The Court used Thompson v. N. Am. Stainless, LP, 562 U.S. 170, to determine whether Plaintiff was a proper Title VII plaintiff, even though he did not engage in protected activity. The Court determined that Plaintiff lacked Title VII standing because unlike Thompson, he was not and never was an employee of the company he sued. The Court stated that allowing Plaintiff to sue under Title VII would be “a remarkable extension” of Title VII since its purpose is to protect employees from their employers’ unlawful actions. In affirming the district court’s ruling, the Fifth Circuit held that the non-employees are not protected from mistreatment from a different employer under Title VII.
Berry v. Sheriff’s Office Ouachita Par., 834 Fed. App’x 843 (5th Cir. 2020). Plaintiff sued Defendants under Title VII, alleging race discrimination and retaliation. Plaintiff worked as a corporal and requested a transfer to a different role for a more stable work schedule. He alleged that after transferring to the role of deputy, he was assured there would be no pay decrease despite the demotion in rank. He filed an EEOC complaint after discovering that Defendant allowed white employees to transfer while maintaining their rank and pay. Plaintiff later ran for and won a position on the city council and was terminated before being sworn into office and without the opportunity to decline his elected position. He alleged he was terminated in retaliation for his EEOC complaint. Plaintiff moved for summary judgment on his retaliation claim and Defendants moved for summary judgment on both claims. The district court denied Plaintiff’s motions and granted the Defendants’ motion. On appeal, the Fifth Circuit agreed with the district court that Plaintiff failed to establish a prima facie case of discrimination, and that even if he did, he was unable to show Defendants’ given reason for his termination was pretextual. With respect to the retaliation claim, the Fifth Circuit held that the timing of his firing, Defendant’s inconsistent explanations of his termination, and the inconsistent application of its policy regarding the holding of public office created a genuine issue of material fact. Thus, the Court reversed the grant of summary judgment for the Defendants on Plaintiff’s retaliation claim.
Robertson v. Wis. Dep’t of Health Servs., 949 F.3d 371 (7th Cir. (Wis.) 2020). Plaintiff, a state agency employee, reported the director of the agency for making a discriminatory remark. The director was terminated. Plaintiff took the place of acting director until the agency held an open recruitment for the position. Plaintiff applied for the position, but was ultimately not promoted. Plaintiff sued her employer for retaliation. She argued that by failing to promote her, her employer retaliated against her for complaining about the former director’s discriminatory conduct. Plaintiff argued that she was “objectively the most qualified candidate.” She also argued that the decision makers of her promotion had close relationships with the former director. The Seventh Circuit affirmed that plaintiff failed to prove a causal link between her reporting of the discriminatory conduct and her not being promoted. The court held that the employer presented a non-retaliatory reason for not promoting her, which was that they simply felt that there was a better candidate based on interviews and education credentials, among other things. The court held that plaintiff failed to establish that this proffered reason was pretext for retaliation. Plaintiff also argued that the new director antagonized and undermined her, which should constitute retaliation. The Seventh Circuit affirmed that plaintiff failed to show that the new director’s actions constituted materially adverse action. The court held that snubbing and rudeness from a coworker are not actionable.
Monaghan v. Worldpay US, Inc., 955 F.3d 855 (11th Cir. (Ga.) 2020). Addressing Susan Monaghan’s Title VII race retaliation claim, the Eleventh Circuit reversed the ruling of the trial court, finding that it had erred in granting Worldpay US summary judgment. Monaghan, who is white, alleged that her African American supervisor had commented that she needed a “suntan,” that “this little white woman is giving me drama over here,” that “you white girls kill me,” and had berated and threatened her for 45 minutes after she raised her complaint. According to the Eleventh Circuit, the evidence, viewed in the light most favorable to Monaghan, satisfied Burlington Northern & Santa Fe Railway Co. v. White, 548 U.S. 53 (2006), where the complained-of conduct “well might have dissuaded a reasonable worker from making or supporting a charge of discrimination.” Here, the supervisor’s statements threatened both termination and possible physical harm, which might have dissuaded a reasonable worker from making or supporting a charge of discrimination. The Court acknowledged that it had deviated from the Burlington Northern standard in a subsequent case, Gowski v. Peake, 682 F.3d 1299 (11th Cir. 2012)—requiring evidence that a supervisor’s misconduct was “severe and pervasive”—and reestablished the correct standard as articulated by the Supreme Court. The Court decided on its own that Monaghan had satisfied the Burlington Northern standard, observing that (1) Worldpay terminated Monaghan, (2) Monaghan allegedly was told that she was being terminated for complaining, and (3) a jury could infer that Monaghan’s termination was in reference to the discrimination complaint she raised to her supervisor. The Monaghan decision creates a lower, more easily-satisfied standard for plaintiffs bringing Title VII retaliation claims in the Eleventh Circuit.
§ 15.5.8 Religion
Horvath v. City of Leander, 946 F.3d 787 (5th Cir. 2020). Plaintiff sued Defendant-Employer, alleging discrimination and retaliation in violation of Title VII and his First Amendment right to freely exercise his religion under Section 1983. Plaintiff worked for Defendant as a firefighter and objected to vaccinations as a tenet of his religion. He previously sought and received exemptions for mandated flu vaccines but was denied an exemption for the mandated TDAP vaccine. Defendant offered him two options as alternatives to receiving the vaccine: (1) reassignment to a new role with the same pay and benefits or (2) remain in his current role and wear personal protective equipment, including a respirator, at all times. Plaintiff rejected both proposals and filed suit. The district court granted Defendant’s request for summary judgment. The Fifth Circuit reviewed de novo and affirmed the district court on all claims. The Court found that while the Plaintiff could establish a prima facie case of religious discrimination, the claim failed because he was offered two reasonable accommodations and Title VII does not require the accommodations to be preferred by the employee. The Court further determined that the Defendant proffered a legitimate, non-discriminatory reason for terminating Plaintiff; namely, failure to obey a direct order from his superiors. Finally, the Fifth Circuit held that the respirator mask requirement in lieu of the vaccine did not violate Plaintiff’s right to freely exercise his religious beliefs.
§ 15.5.9 Miscellaneous
Our Lady of Guadalupe Sch. v. Morrissey-Berru, 140 S. Ct. 2049 (2020). The Court heard the appeal of two cases from the Ninth Circuit—Morrissey-Berru v. Our Lady of Guadalupe Sch., 769 Fed. App’x 460 (9th Cir. (Cal.) 2019), and Biel v. St. James Sch., 911 F.3d 603 (9th Cir. (Cal.) 2018)—involving the scope of the “ministerial exception.” Both cases involved elementary school teachers at Catholic schools. In one case, Agnes Morrissey-Berru argued that the school had violated the ADEA when it demoted her, failed to renew her contract, and replaced her with a younger teacher. In the other case, the late Kristen Biel had filed a charge with the EEOC alleging that she was discharged after requesting a leave of absence to obtain treatment for breast cancer. In both cases, the Ninth Circuit had ruled in favor of the plaintiffs. However, in a 7-2 decision, the Court reversed these rulings and took a broad view of the ministerial exemption. Specifically, the Court held that the First Amendment bars courts from considering the federal employment discrimination claims of the two teachers because they performed “vital” religious duties. According to Justice Alito, “[w]hen a school with a religious mission entrusts a teacher with the responsibility of educating and forming students in the faith, judicial intervention into disputes between the school and the teacher threatens the school’s independence in a way that the First Amendment does not allow.” The Court first recognized this exception about a decade prior in Hosanna-Tabor Evangelical Lutheran Church & Sch. v. EEOC, 565 U.S. 171 (2012). In the present case, Justice Alito wrote that “[t]he Ninth Circuit mistakenly treated the circumstances the court found relevant in Hosanna-Tabor as a [rigid] checklist of items to be assessed and weighed against each other,” which “produced a distorted analysis.” The Court further specified that whether an employee is considered a “minister” for purposes of the exemption is not based upon the employee’s label but on the work the employee performs. This holding suggests that not every employee of a religious institution will fall within the exception; rather, the test will focus on the employee’s actual day-to-day responsibilities.
Jackson v. Modly, 949 F.3d 763 (D.C. Cir. 2020). Plaintiff, a former US Marine Corps service member, brought a pro se action against the Secretary of the US Department of the Navy, alleging employment discrimination based on race, color, and sex in violation of Title VII. The district court dismissed the action, and the D.C. Circuit affirmed. Breaking with other circuits, the D.C. Circuit held, as a matter of first impression, that the protections afforded by Title VII do not extend to uniformed members of the armed forces. The Court concluded that service members are excluded from the federal definition of “employee” under Title 5, which specifies how laws apply to government employees. Further, as a matter of first impression, the Court held that statutes of limitations requiring all civil actions against the federal government be filed within six years of the date on which the action accrued was not a jurisdictional requirement. Consequently, because the alleged discrimination occurred over 20 years prior, Plaintiff was not entitled to equitable tolling of the limitations period for bringing his claims. Plaintiff argued that this decision was inconsistent with the Supreme Court’s recent holding in Bostock, which found that Title VII protects individuals on the basis of sexual orientation and gender identity. However, in November 2020, the Supreme Court denied Plaintiff’s petition for certiorari.
Lemon v. Myers Bigel, P.A., et al., — F.3d –, 2021 WL 161978 (4th Cir. 2021). The Fourth Circuit affirmed the lower court’s dismissal of Plaintiff’s race and gender discrimination claims under Title VII and Section 1981 because she was not an “employee” of the firm. In 2001, Plaintiff joined Myers Bigel (MB) as an associate practicing patent law and signed an employment agreement that, in part, identified her employment as “at will.” In 2007, she became a shareholder in MB, signed a shareholder agreement, and purchased 5,000 shares in the firm. In 2011, Plaintiff became eligible to serve on the Board’s Management Committee, and in 2016 she held the roles of Secretary and Vice President. In 2016, MB hired an outside attorney to investigate claims of gender discrimination. Plaintiff requested to see the findings of this report, which was denied by the Board. Upon learning that Plaintiff had talked privately with the investigator, the Board’s relationship with Plaintiff soured. Later that year, Plaintiff submitted a request for short-term leave, which was voted down by the other Board members. Plaintiff alleged that this denial was in retaliation for her comments to the investigator; she then resigned from MB and filed suit. The Fourth Circuit agreed with the finding of the district court that Plaintiff was not an employee of MB and thus not covered by Title VII’s protections. According to the Court, “[a]s a partner and co-equal owner of [MB], with an equal vote on all matters substantively impacting the firm, [Plaintiff] was not an employee.”
§ 15.6 Retaliation
§ 15.6.1 Protected Activity
Agosto v. N.Y.C. Dep’t of Educ., 982 F.3d 86 (2d Cir. 2020). High School of Art and Design teacher Jason Agosto alleged that he suffered retaliation through disciplinary letters and poor evaluations in violation of the First Amendment after filing union and employment grievances critical of Principal Manuel Ureña. His complaints alleged that Ureña had not followed proper collective-bargaining procedures before changing options available for teachers to use during their “professional period” each day, had not turned over budget documents that Agosto requested, had recruited another teacher to report what he heard at a teachers’ union meeting, and had retaliated against Agosto for his actions within the union. However, the Second Circuit affirmed the district court’s decision to grant summary judgment to the principal and New York City Department of Education, finding that the teacher’s First Amendment retaliation claims failed because his complaints were not protected as matters of public concern. The Second Circuit explained further that the principal’s “alleged actions fall within the category of behavior that is ‘obviously offensive and inappropriate’ but did not ‘alter the conditions of [the teacher’s] employment’ such that it was actionable.” The Second Circuit also ruled that the principal’s alleged behavior did not go far enough to constitute a hostile work environment and retaliation based on sex under Title VII of the Civil Rights Act. “His sex-based hostile work environment claim fails because he has not demonstrated severe or pervasive hostility in the workplace, and his retaliation claim fails because he has not demonstrated a causal link between protected activity and any allegedly adverse action.”
Liscomb v. Boyce, 954 F.3d 1151 (8th Cir. 2020). The Eighth Circuit held that the FLSA does not protect prospective employees. Plaintiff was discharged from the Lawrence County Sheriff’s Office (“LCSO”) where he served as a canine officer for more than three years prior to his termination. After his discharge, Plaintiff hired an attorney and began negotiating with the LCSO for overtime compensation. At the same time, Plaintiff learned that the Drug Task Force at LCSO was seeking a canine officer and applied for the position. Plaintiff claims that Defendant retaliated against him by denying him employment, and alleges that Defendant said the “lawsuit was holding [Defendant] back from employing [Plaintiff] with the Drug Task Force.” The Court affirmed the lower court’s decision that Plaintiff, as a prospective employee for the new position in the Drug Task Force, was not entitled to coverage under the FLSA.
Gogel v. Kia Motors Mfg. of Ga. Inc., 967 F.3d 1121 (11th Cir. (Ga.) 2020). In a sharply divided en banc decision, the full Eleventh Circuit upheld the grant of summary judgment to Kia Motors in a Title VII action. In reversing the earlier panel ruling, Gogel v. Kia Motors Mfg. of Ga., 904 F.3d 1226 (11th Cir. (Ga.) 2018), the Court held that Andrea Gogel, a former HR manager who was fired for helping a colleague file a race discrimination suit, cannot sue the car maker for retaliation. Gogel’s suit alleged that the Korean car maker had discriminated against her as a white woman and had fired her for filing race bias claims with the EEOC. Conversely, Kia argued that it had appropriately fired Gogel for disloyalty. Seven of twelve circuit judges determined that Gogel did not have a retaliation claim under Title VII’s so-called opposition clause, where she lost legal protection when she encouraged her colleague to sue the company. The opposition clause prevents employers from punishing employees who allege discrimination; however, under circuit precedent, employees lose this protection when their opposition “so interferes with the performance” of their job duties that they become ineffective. Gogel’s attempts “to recruit an employee to sue the company so clearly conflicted with the performance of her job duties . . . that it rendered her ineffective in that position and reasonably prompted Kia to conclude that it could no longer trust her to do the job for which she was being paid.” For the majority, Gogel filing a charge of discrimination on her own behalf would be protected activity under Title VII, but her solicitation of another employee to sue Kia rendered her ineffective in her position as a matter of law. Thus, an employee tasked with investigating employee complaints, such as an HR manager, cannot encourage employees to sue their employer and maintain his or her protected status under Title VII’s opposition clause.
§ 15.6.2 What Is a Sufficient Adverse Job Action to Support a Retaliation Claim?
Menoken v. Dhillon, 975 F.3d 1 (D.C. Cir. 2020). Plaintiff, who worked as an attorney at the EEOC, alleged that the agency engaged in a multi-year campaign of retaliation in response to complaints she had raised, subjecting her to a hostile work environment. Plaintiff filed action against the EEOC, bringing claims under Title VII and the Rehabilitation Act. The district court dismissed Plaintiff’s complaint for failure to state a claim and denied her motion for reconsideration. On appeal, the D.C. Circuit found that it was error for the district court to dismiss Plaintiff’s retaliation claims on the ground that they occurred while she was on paid leave. The Court noted that court precedent “explicitly rejected” the idea that a hostile work environment cannot be implemented while an employee is out of the office. “[An] employer’s deliberate attempts to affect an employee’s finances and access to health care strike us as precisely the type of conduct that ‘might have dissuaded a reasonable worker from making or supporting a charge of discrimination.’” The lower court also erred in dismissing Plaintiff’s claims that the EEOC violated the Rehabilitation Act by denying her reasonable accommodation request related to the “physical and mental” injuries sustained due to the hostile work environment. Specifically, the Court found that the EEOC had failed to provide documentation supporting its argument that Plaintiff had requested only paid leave as a reasonable accommodation.
§ 15.6.3 Retaliatory Intent
Couch v. Am. Bottling Co., 955 F.3d 1106 (8th Cir. 2020). Plaintiff, an operations manager at Dr. Pepper who received positive reviews from his supervisors for many years, brought a retaliation claim under Title VII and the Iowa Civil Rights Act, alleging that he was terminated because the company discovered that he had filed a charge of discrimination against a new supervisor. Plaintiff claimed that he received his first-ever negative review just three days after Dr. Pepper learned of an EEOC discrimination charge against his new supervisor. They waited only 15 days to suspend him, and then fired him 15 days later. The Court found that, although Plaintiff was terminated within a month of the charge, Plaintiff failed to show that Dr. Pepper’s proffered legitimate nondiscriminatory reasons for its actions (that Plaintiff had difficulty adjusting to new management expectations, was unwilling to be coached, and was becoming “combative” in meetings) were pretextual.
§ 15.7 Wage Hour Issues
§ 15.7.1 Exemptions
Hewitt v. Helix Energy Sols. Grp., 983 F.3d 789 (5th Cir. 2020). Plaintiff sued Defendant-employer Helix Energy Solutions Group under the FLSA, alleging overtime violations. Plaintiff worked as a tool pusher and was paid a daily rate—his pay was computed on a daily basis rather than a weekly, monthly, or annual basis. To qualify for an FLSA exemption, Defendant attempted to characterize Plaintiff as either an executive or a highly compensated employee. The district court agreed with Defendant’s characterization and granted summary judgment to Defendant. The Fifth Circuit reviewed the interpretations of the applicable regulations de novo. For Defendant to prevail, it had to show Plaintiff was paid on a salary basis as required by the FLSA, despite being paid a daily rate. Looking at § 541.694(b), the Court determined that an employer can pay an exempt employee an amount computed on a daily basis without violating the salary basis requirement if two conditions are met: (1) for the employer to offer a minimum weekly required amount that is paid regardless of the number of hours, days, or shifts worked; and (2) to meet the reasonable relationship test that sets a ceiling on how much the employee can expect to work in exchange for the normal paycheck. The Fifth Circuit held that Defendant could not meet the two conditions to show Plaintiff is paid on a salary basis despite being a daily rate employee. It also held that Defendant could not establish Plaintiff was a highly paid employee because his total annual compensation did not meet the minimum requirement paid on a salary basis. Accordingly, the Fifth Circuit reversed the grant of summary judgment to Defendant.
§ 15.7.2 Joint Employment
State of New York v. Scalia, 2020 U.S. Dist. LEXIS 163498 (S.D.N.Y. Sept. 8, 2020). The district court struck down a substantial portion of the recently promulgated Final Rule issued by the Department of Labor (DOL) regarding the standard for establishing joint-employer liability under the Fair Labor Standards Act (FLSA). The Rule replaced the standard from 1958 that said a joint employer relationship is one in which “employment by one employer is not completely disassociated from employment by the other employer.” Under the new Rule, DOL stated that the proper focus is on “the potential joint employer’s exercise of control over the terms and conditions of the employee’s work.” The Rule enumerated a four-factor balancing test that sought to assess whether the alleged joint employer: (1) hires/fires the employee; (2) supervises and controls the employee’s work schedules or conditions of employment; (3) determines the employee’s rate and method of payment; and (4) maintains the employee’s employment records. DOL further concluded that an entity may qualify as a joint employer only if it actually “[takes actions] with respect to the employee’s terms and conditions of employment,” rather than merely possessing the “theoretical ability” to do so. In February 2020, attorneys general on behalf of 18 states sued to have the Rule vacated. The district court concluded that while the Rule’s interpretation of horizontal joint employer liability was severable, its interpretation of vertical joint employer liability conflicts with the FLSA’s broad definitions of “employer,” “employee,” and “employ.” In addition, the court observed that the Rule’s test for joint employment is impermissibly narrow, with the four factors serving as “a proxy for control” in a manner that is inconsistent with DOL’s previous interpretive guidance and a significant body of case law. And, the court held the Rule to be arbitrary and capricious because DOL failed to adequately explain why it departed from its prior interpretations, failed to consider consistency within its existing regulations, and did not consider the Rule’s cost to workers. Based on the court’s decision, within the Southern District of New York, the joint-employer analysis will continue to be guided by various, preexisting federal court standards. In November 2020, the Trump administration appealed the decision to the Second Circuit Court of Appeals.
Talarico v. Public P’ships LLC, 2020 U.S. App. LEXIS 38027 (3d Cir. (Pa.) Dec. 7, 2020). In a nonprecedential opinion, the Third Circuit reversed and remanded a district court ruling that had held that Public Partnerships LLC (PPL) was not a joint employer to Medicaid-funded home care workers and thus could avoid class claims brought under the FLSA for failure to pay overtime. Ralph Talarico sued PPL in 2017, alleging it had violated the FLSA and Pennsylvania wage laws by paying overtime only when direct care workers spent more than 40 hours a week with one client. Relying on the four-factor test articulated in In re Enter. Rent-A-Car Wage & Hour Emp’t Practices Litig., 683 F.3d 462 (3d Cir. 2012), the Third Circuit determined that two of the four factors supported the conclusion that PPL is a joint employer: (1) establishing rules for the direct care workers and setting their working conditions, and (2) maintaining their records, including tax forms, time sheets, and an employment enrollment packet. Consequently, “[w]hether PPL is Talarico’s employer is a genuine dispute as to a material fact because the evidence—viewed in the light most favorable to the nonmoving party, Talarico—does not so favor PPL that no reasonable juror could render a verdict against it.” While the other two factors weighed against concluding that PPL is a joint employer, the Court observed that there is “no specific number or combination of Enterprise factors that conclusively determines whether an alleged employer is a joint employer,” and that the “total employment situation” indicates Talarico is PPL’s employee.
§ 15.7.3 Miscellaneous
Scott v. Chipotle Mexican Grill, Inc., 954 F.3d 502 (2d Cir. (N.Y.) 2020). The Second Circuit affirmed a lower court’s decision to deny class certification to Chipotle workers in six states claiming they were denied overtime pay. However, the Court vacated the court’s decision to decertify more than 500 management trainees’ collective action in Colorado, Illinois, Missouri, New York, North Carolina, and Washington during various time periods, on the grounds that their work responsibilities differed too much. The Second Circuit remanded the district court order decertifying the collective action consisting of seven named plaintiffs who sued the burrito chain and 516 opt-in plaintiffs who joined the FLSA suit after the lower court conditionally certified it. On remand, the district court was directed to reconsider whether the named plaintiffs and opt-in plaintiffs are “similarly situated” because they share questions of law or fact material to their FLSA claims. According to the Second Circuit, the district court erroneously assumed that the size of the FLSA collective action required greater scrutiny mirroring Federal Rules of Civil Procedure Rule 23 standards for class certification and thus led the lower court to decertify the collective. The Second Circuit explained, “This was error. In effect, the district court held that collective plaintiffs could not be similarly situated because class plaintiffs’ common issues did not predominate over individualized ones. It is simply not the case that the more opt-ins there are in the class, the more the analysis under [FLSA Section] 216(b) will mirror the analysis under Rule 23.”
Tom v. Hosp. Ventures LLC, 980 F.3d 1027 (4th Cir. 2020). Defendant-employer was an upscale sushi restaurant operating its business in Cary, North Carolina. Plaintiffs were tipped servers who sued under the FLSA and the North Carolina Wage and Hour Act, alleging that the defendant violated the FLSA’s minimum-wage and overtime requirements by operating a tip pool that unlawfully included employees who did not customarily and regularly receive tips and were, thus, ineligible. The district court granted summary judgment for the employer. On appeal, the Fourth Circuit affirmed in part and reversed in part. The Fourth Circuit agreed with the district court that the servers’ receipt of automatic gratuities did not count as “tips” under the FLSA because the automatic gratuity was not discretionary—the amount was set by Defendant and the customers lacked any ability to remove or modify it. However, the Fourth Circuit found that the district court did not properly consider whether the automatic gratuities qualified as commissions under the FLSA’s Section 7(i) exemption, which exempts employers from paying overtime to employees who make a majority of their earnings from commissions. The Fourth Circuit found that the district court failed to include tips when determining whether the automatic gratuities constituted more than half of the employees’ compensation for a representative period. Next, the Fourth Circuit held that even if the servers qualified for the Section 7(i) exemption, this did not answer the question as to the legality of Defendant’s tip pooling system. The Fourth Circuit held that there were genuine issues of material fact as to whether certain employees included in the tip pool had more than de minimis interactions with customers and directed the district court to review this on remand.
Swales v. KLLM Transp. Servs., L.L.C., 985 F.3d 430 (5th Cir. 2021). Plaintiffs requested certification to bring a collective action claim under the FLSA against Defendant KLLM Transport Services. Plaintiffs brought a minimum-wage dispute alleging that the Defendant misclassified them and all other truck drivers as independent contractors when they are, in fact, employees entitled to the minimum wage. Applying the widely used Lusardi test, a two-step method for certifying a collective action, the district court granted the Plaintiffs’ certification request. Reviewing de novo, the Fifth Circuit declined to delineate the district court’s notice-sending discretion within Lusardi and rejected Lusardi as the method for certifying a collective action. The Court reasoned that the Lusardi test frustrates the notice process and diverges from the FLSA’s text because “certification” and “conditional certification” do not appear in the text. The Court articulated a new legal standard: the district court should identify what facts and legal considerations are material in determining whether a group of “employees” are similarly situated. The district court then should dictate the amount of discovery needed to determine if and when to send notice to potential opt-in plaintiffs. After considering all available evidence, the district court should determine whether the group is “similarly situated” and thus may proceed on a collective basis. By announcing this new framework and rejecting the Lusardi test, the Fifth Circuit vacated the district court’s order granting the Plaintiff’s motion for conditional certification.
Torres v. Vitale, 954 F.3d 866 (6th Cir. 2020). The Fifth Circuit reversed the district court’s dismissal of a claim for damages under RICO brought by Plaintiff. The Court held that the district court improperly dismissed the claim by asserting that FLSA precluded RICO claims based on lost wages. Plaintiff was a longtime employee at Defendant’s restaurant and alleged he and other employees often worked more than 40 hours per week and were not paid overtime rates for those hours. Plaintiff alleged he was paid cash for the overtime hours, did not pay taxes on the cash payment, and was deprived of overtime pay. The district court dismissed his complaint, asserting that the FLSA’s remedial scheme precluded the RICO claim. On appeal, the Fifth Circuit held that the FLSA precludes RICO claims to the extent that the damages sought are for unpaid minimum or overtime wages. However, if a RICO claim alleges damages that are distinct from unpaid wages, FLSA does not preclude it even if the conduct arises from conduct that also violates the FLSA. The Fifth Circuit instructed the district court to determine whether Plaintiff adequately pleaded a RICO claim that resulted in damages other than lost wages.
Viet v. Le, 951 F.3d 818 (6th Cir. 2020). Plaintiff sued under the FLSA, alleging Defendant wrongfully failed to pay him overtime despite typically working 60 hours per week. Plaintiff bought used copiers for Defendant—who shipped them to Vietnam for resale—and was paid commission based on the purchase price of the copier. The district court granted Defendant’s request for summary judgment. It assumed Plaintiff qualified as an employee under FLSA and held that the evidence presented to support the allegation that he worked more than 40 hours per week did not suffice to withstand summary judgment. Though the Fifth Circuit did not think it was clear that Plaintiff qualified as an employee covered under FLSA, it made the same assumption as the district court. Using Rule 56 of the FLSA, the Fifth Circuit decided whether Viet’s evidence could permit a reasonable jury to conclude he worked more than 40 hours per week during any given week during his employment with Defendant. The Court held that Plaintiff’s evidence was inconsistent, providing no specific facts that would allow a jury to determine whether he worked beyond 40 hours in any specific week. Thus, the Court affirmed the district court’s ruling.
Herrera v. Zumiez, Inc., 953 F.3d 1063 (9th Cir. 2020). Plaintiff filed a class action lawsuit against Defendant-employer, alleging that Defendant failed to provide reporting-time pay to employees at its California retail stores for their “Call-In” shifts. Employees scheduled for a Call-In shift were required to make themselves available to work during the shift and then call their manager 30 to 60 minutes before the beginning of their shift; or, if they worked a shift immediately before the Call-In shift, contact their manager at the end of that shift. At the time of the contact, the manager would tell the employee whether s/he was required to work during the shift. If the employee was not required to work, Defendant would not pay the employee. Defendant filed a motion for judgment on the pleadings, which the district court denied. The Ninth Circuit affirmed the denial of the employer’s motion based on the California Court of Appeal’s recent ruling in Ward v. Tilly’s, Inc., 31 Cal. App. 5th 1167 (2019), holding that an employee need not physically report to work in order to be eligible for reporting-time pay. The Ninth Circuit also affirmed denial of Defendant’s motion to dismiss the claim for “hours worked” associated with the time spent by employees calling in three to four times each week. Finally, the Court reversed the denial of Defendant’s motion to dismiss the claim for indemnification for the telephone expenses incurred in calling in, but ordered that Plaintiff be allowed to amend the complaint to include more specific allegations.
Ridgeway v. Walmart Inc., 946 F.3d 1066 (9th Cir. 2020). The Ninth Circuit held that (1) employers must pay minimum wages for time spent on mandated layovers where the employer’s policy imposes constraints on employees’ movements during breaks, and (2) California’s minimum wage laws for transportation workers are not preempted by the Federal Aviation Administration Authorization Act. The Court upheld a $54.6 million judgment after evaluating that the written policies in Defendant’s pay manual would amount to an exercise of control over drivers during layover periods if implemented as written, as a matter of California law. Assessing whether Defendant exercised control of its employees during layovers, the Court stated that the question of control boiled down to whether the employee might use break or non-work time however s/he would like. The manual required drivers to gain preapproval from management before taking a layover at home, as well as to record the break, and the approving manager, on the trip sheet. Finally, drivers could be subject to disciplinary action, up to and including “immediate termination,” for taking an unauthorized layover at home. In its review of the class certification and damages analysis of the trial court, the Ninth Circuit agreed with the district court finding that common issues predominated. Rejecting Defendant’s argument that Plaintiffs could not use representative evidence to prove the elements of their case, the Court held that liability was suitable for class treatment on the basis of substantial supporting evidence showing that Defendant owed class members minimum payment during layovers. And, once the jury found that minimum wages were owed, the varying amount of time spent on each task “went to the question of damages.”
Scalia v. Emp’r Sols. Staffing Grp., Ltd. Liab. Co., 951 F.3d 1097 (9th Cir. 2020). In an action alleging that Defendant failed to pay overtime to employees who worked more than 40 hours in a workweek, in violation of the FLSA, the Ninth Circuit affirmed the lower court’s summary judgment in favor of Plaintiff. Defendant-employer contracted with other companies, including Sync Staffing, to recruit employees and place them at jobsites for which Defendant handled administrative tasks, including payroll. In this case, Sync Staffing placed the recruited employees at a jobsite run by TBG Logistics and instructed one of Defendant’s employees, who was responsible for payroll processing, to pay the employees’ overtime hours as “regular” hours. To comply with Sync Staffing’s instruction, Defendant’s employee had to dismiss numerous error messages from Defendant’s payroll software. Defendant’s employee later admitted that she knew the recruited employees were not being paid correctly for the overtime they had worked. The Ninth Circuit noted that a two-year statute of limitations ordinarily applies to claims brought under FLSA, but the limitations period extends to three years for a “willful violation.” Because Defendant, through its agent, recklessly disregarded the possibility that it was violating the FLSA, the three-year statute of limitations applied, and the affected employees were entitled to approximately $78,500 in unpaid overtime wages, and an equal amount in liquidated damages. The Court also rejected Defendant’s cross-claims against the other defendants, holding that “the FLSA does not provide a right to contribution or indemnification for liable employers.”
Aguilar v. Mgmt. & Training Corp., 948 F.3d 1270 (10th Cir. 2020). Plaintiffs, officers of a prison, alleged that their employer, Management and Training Corporation (MTC), failed to pay them for certain activities they performed prior to arrival, at arrival, and after leaving their posts. The activities included: undergoing security screenings, receiving pre-shift briefings, checking equipment and keys in and out, walking to and from their posts, and conducting passdown briefings. Plaintiffs alleged that their pre- and post-shift activities were compensable work, and that MTC’s compensation system deprived the officers of overtime pay in violation of the FLSA. The lower court granted summary judgment in favor of MTC, but the Tenth Circuit reversed. The Tenth Circuit held that the officer’s pre- and post-shift activities did constitute compensable work, reasoning that these pre- and post-shift activities were integral and indispensable to the officers’ principal activities. In so holding, the Tenth Circuit expressly rejected MTC’s argument that these tasks were de minimis, instead concluding that the time at issue could reasonably be recorded and/or estimated by MTC; that the aggregate amount of compensable time was substantial; and, that the officers regularly performed the work at issue. The Tenth Circuit also rejected MTC’s argument that it was not required to pay for activities of officers for which MTC was not previously aware, primarily because MTC actually required that the officers complete many of the tasks at issue. And finally, Plaintiffs presented evidence suggesting that MTC did not neutrally apply its ten-minute adjustment rule, and therefore their time-rounding claim could proceed.
Scalia v. Paragon Contractors Corp., 957 F.3d 1156 (10th Cir. 2020). Over the course of several years, Defendant had employed hundreds of children to help harvest pecans at a local ranch. Defendant was eventually enjoined from using child labor in violation of the FLSA, and was held in contempt for subsequently violating the injunction. Defendant was then ordered to establish a fund to be used by the Secretary of Labor in accordance with a claims process for the benefit of children who performed work for Defendant without pay. After the claims process was concluded and a payment schedule was proposed, the district court ordered that Defendant replenish the fund in the amount calculated by the Secretary. Defendant challenged this order on the grounds that (1) the Secretary failed to establish a prima facie case regarding the time worked and amount owed; (2) the district court imposed an improperly high burden for rebutting inferences drawn from the available evidence; and (3) the district court erred in declining to apply an FLSA statutory exemption. The Tenth Circuit did not find merit to any of Defendant’s claims. First, the Tenth Circuit held that the Secretary established a prima facie case by using representative evidence from a sample of employees. This was particularly necessary because Defendant did not keep records of the work performed by children at the ranch. Second, the Tenth Circuit rejected Defendant’s contention that the burden for rebutting the Secretary’s case was too high. Because Defendant failed to keep records, the burden was on Defendant to “specifically and expressly” rebut the reasonable inferences drawn from the employee’s evidence. Defendant failed to do so here. And finally, the Tenth Circuit held that the statutory exemption of 29 U.S.C. § 213(c)(1)(B) did not apply. Section 213(c)(1)(B) provides an exemption for 12 and 13-year-olds who work outside of school hours and are either employed on the same farm as their parents or are working with parental consent. Defendant failed to provide sufficient evidence to establish that this exemption applied, and therefore Defendant was not entitled to deduct any hours under this provision.
Lewis v. Governor of Ala., 944 F.3d 1287 (11th Cir. (Ala.) 2019). In a split en banc decision, the full Eleventh Circuit held that two African American workers who stood to make $10.10 an hour under Birmingham’s minimum wage ordinance could not bring a claim against the office of Alabama Attorney General Steve Marshall over the purported enforcement of a law mandating a single, statewide minimum wage set at $7.25. In 2016, a district court had dismissed the complaint, which had been joined by the NAACP and civil rights groups, alleging that Alabama had violated the Constitution’s Equal Protection Clause by enacting its minimum wage preemption law shortly after Birmingham lifted its wage floor to $10.10 per hour. The law voided any local law that required employers to provide benefits or wages not otherwise mandated by state or federal law. The subsequent panel ruling, Lewis v. Governor of Ala., 896 F.3d 1282 (11th Cir. 2018), had partially revived the workers’ claims that Alabama’s law discriminated against Birmingham’s African American majority. However, in a seven-to-five decision, the full Eleventh Circuit held that the two workers had failed to show that any monetary injuries they suffered as a result of being paid at the lower wage rate were “fairly traceable” to the attorney general’s conduct, or that such injuries would be remedied if their suit succeeded. The majority found that such a conclusion would be “impermissibly speculative,” particularly since the contested law did not require affirmative enforcement by the Alabama Attorney General (and, in fact, contained no enforcement provision at all). Consequently, because the Court resolved the case on the standing issue, it declined to address the merits of the workers’ Constitutional claims.
§ 15.8 FMLA
Gomes v. Steere House, C.A., No. 20-270-JJM-PAS, 2020 WL 6397930 (D.R.I. Nov. 2, 2020). The District of Rhode Island permitted an employee’s claim for retaliation under the Family Medical Leave Act (“FMLA”) to move forward despite not being eligible for the requested FMLA leave. Plaintiff contracted COVID-19 and requested FMLA leave under the Emergency Paid Sick Leave Act (“EPSLA”). Subsequently, Plaintiff was terminated from her employment. The Court first determined that EPSLA has no connection to the FMLA and does not modify the leave available under that Act. However, the Court also reasoned that Plaintiff may have stated sufficient facts to satisfy the first element of a retaliation claim under the FMLA, which requires a showing that the plaintiff “availed himself of a protected right under the FMLA.” The Court relied on dicta from McArdle v. Town of Dracut/Dracut Pub. Sch., 732 F.3d 29 (1st Cir. 2013), to find that a plaintiff may be able to allege retaliation under the FMLA for attempting to exercise a right despite being ineligible for such leave. In so finding, the Court denied Steere House’s motion to dismiss and permitted the Plaintiff’s retaliation claim to proceed.
New York v. United States Dep’t of Labor, No. 20-CV-3020 (JPO), 2020 WL 4462260 (S.D.N.Y. Aug. 3, 2020). In response to the coronavirus pandemic, Congress enacted the Families First Coronavirus Response Act (FFCRA), providing employees impacted by COVID-19 with paid emergency sick leave and paid emergency family leave in certain circumstances. The portion of the FFCRA that relates to paid emergency sick leave is referred to as the Emergency Paid Sick Leave Act (EPSLA) and the portion that relates to paid emergency family leave is known as the Emergency Family and Medical Leave Expansion Act (EFMLEA). The Department of Labor (DOL) was charged with administering the law. In April 2020, DOL enacted a final rule which set parameters about how the FFCRA would be implemented (Final Rule). In response, the State of New York (NYS) sued DOL, claiming the Final Rule was improper. The United States District Court for the Southern District of New York issued a ruling in favor of NYS, striking down critical parts of the Final Rule. For example, the court overturned the Final Rule’s definition of “health care provider,” finding that it was overbroad because it hinged on the nature of the services the employer provides rather than the services provided by the employee. The Court upheld the prohibition on the use of intermittent leave where an employee is at risk of spreading COVID-19 to other employees; however, where intermittent leave is available, the Court determined that the Final Rule is unreasonable to the extent it allows employers to refuse to agree to provide intermittent leave to care for a child. Finally, due to conflict between the EFMLEA and EPSLA, the Court held that the documentation requirement is invalid to the extent it requires documentation to be submitted before leave is taken.
Lutes v. United Trailers, Inc., 950 F.3d 359 (7th Cir. 2020). Plaintiff, former employee of a manufacturing company, suffered a hip injury and called in absent to work for several days, citing his rib injury. Plaintiff’s rib injury was cited as the reason for his absence on only some of those days. After a couple weeks, Plaintiff stopped calling in absent and stopped showing up to work altogether. Having violated the company’s attendance policy, defendant terminated plaintiff’s employment. Plaintiff filed suit against the defendant alleging that they had failed to properly notify him of his rights under the Family Medical Leave Act and that he was fired in retaliation for attempting to exercise his right to seek leave under the Act. The Seventh Circuit analyzed his first claim of interference. In deciding whether plaintiff’s rib injury entitled him to FMLA leave and whether he provided notice of his intent to take leave, the Seventh Circuit held that his rib injury was a serious health condition entitling him to FMLA leave. Regarding whether he provided notice of his intent to take leave, the Seventh Circuit considered that the defendant knew of his rib injury as shown by the call-in log, but remanded the case to decide whether the nature and amount of information that the plaintiff conveyed about his intent to seek leave put the defendant on notice of that intent. Furthermore, the Seventh Circuit remanded the issue of whether the plaintiff’s failure to follow the defendant’s attendance policies foreclosed his interference claim. The Seventh Circuit also remanded the issue of whether the plaintiff could show not just that the employer was out of compliance with FMLA for not notifying him of his right to take leave, but that this interference injured him. The court noted that if he can prove that he would have taken the leave if he had known about it, he can sufficiently show prejudice and therefore injury. Regarding plaintiff’s retaliation claim, the Seventh Circuit affirmed that plaintiff had failed to show any discriminatory or retaliatory intent or that he had even engaged in a protected activity.
Scalia v. Dep’t of Transp. & Pub. Facilities, 985 F.3d 742 (9th Cir. 2021). The Ninth Circuit held that under the FMLA, a “workweek” does not revolve around an individual employee’s own work schedule. Instead it is simply a weeklong period, designated in advance by the employer, during which the employer is in operation, consistent with the definition of “workweek” under the FLSA. The Secretary of Labor, Scalia, brought suit against the State of Alaska’s Department of Transportation and Public Facilities, Alaska, alleging that Alaska was miscalculating the amount of FMLA leave that certain employees of the Alaska Marine Highway System (“AMHS”) were entitled to take. AMHS had a number of rotation employees who worked a regular schedule of seven days on followed by seven days off, that is 80 hours one work week, and zero hours the next. Scalia alleged that those rotational employees who took continuous leave under the FMLA need not return to work for 24 weeks rather than 12, because a rotational employee’s off weeks could not be counted as “workweeks of leave” under the FMLA. The Ninth Circuit overturned the district court’s decision which agreed with the Secretary, holding that “workweek” refers to “time that an employee is actually required to be at work.
Simmons v. William B. Henghold, M.D., P.A., 803 Fed. App’x 356 (11th Cir. (Fla.) 2020). The Eleventh Circuit revived an FMLA claim brought by a nurse who alleged that the Florida dermatology practice at which she worked improperly changed her job duties after she took leave to manage the “mental anguish” that resulted from her affair with the practice’s founder. During the nurse’s absence, the practice hired a replacement who took on many of the nurse’s administrative duties. Furthermore, the replacement’s testimony indicated that she understood she would be in charge of the nurse, and that the replacement did not expect the nurse to return to work after her FMLA leave. The Court found that there was sufficient evidence supporting the nurse’s claims that she had been stripped of several of her responsibilities upon her return to work, where a reasonable jury could conclude that her post-FMLA leave job was not equivalent to her pre-FMLA leave job. For the Court, this factual dispute had to be resolved by the trier of fact. In addition, there were disputed material facts as to the employer’s defense that the employer would have hired a replacement for the nurse even if she had not taken FMLA leave.
§ 15.9 Terminations / Settlement
Piron v. Gen. Dynamics Info. Tech., Inc., No. 3:19-cv-709, 2020 WL 1159383 (E.D. Va. Mar. 10, 2020). Plaintiffs filed a putative class action on behalf of themselves and approximately 1,500 similarly situated employees, alleging that they had been terminated in violation of the Worker Readjustment and Retraining Notification Act (WARN Act). Plaintiffs alleged that the employees all worked “remotely” from their homes but reported to, and received assignments from, two managers who were located in Defendant’s Falls Church, Virginia office. Plaintiffs alleged that, in terminating them, Defendant violated the WARN Act by failing to provide sixty days’ advance written notice of terminations. The District Court granted Defendant’s motion to dismiss, noting that the WARN Act’s limitation applies to an “employment loss at a single site of employment during any 30-day period for . . . at least 50 employees.” 29 U.S.C. § 2101(a)(3)(B)(i)(II). For the Court, the question was whether Plaintiffs had adequately alleged that they and the putative class were all employed at a “single site of employment.” Plaintiffs argued that they all worked at a single site of employment pursuant to a DOL regulation. However, that regulation applied only to “workers whose primary duties require travel from point to point, who are outstationed, or whose primary duties involve work outside any of the employer’s regular employment sites.” In reviewing the regulation, the Court determined that the regulation could apply only to “truly mobile” employees, and that Plaintiffs had failed to allege facts sufficient to show that the employees were “truly mobile.” Accordingly, the Court held that Plaintiffs did not all work at a “single site of employment,” and therefore dismissed their WARN Act claim.
Button v. Dakota, Minn. & E. R.R. Corp., 963 F.3d 824 (8th Cir. 2020). In affirming an order for summary judgement, the Eighth Circuit held that a remark will only constitute direct proof of discrimination when it is made by a decision-maker, and when the alleged discriminatory remark can be linked to the challenged adverse job action. Employee-Plaintiff filed a sex discrimination claim against employer-Defendant when Plaintiff was laid off during a reduction in force. Plaintiff, a train dispatching supervisor, principally relied on a comment made by the director of train dispatching, who was female, who allegedly said that the train dispatching desk “wasn’t a place for a woman” while visiting the desk. However, the director of train dispatching was not involved in the reduction in force decision-making and was not Plaintiff’s supervisor.
§ 15.10 Uniformed Services Employment
There were no qualifying decisions this year.
§ 15.11 Miscellaneous
§ 15.11.1 Benefits / ERISA / COBRA
Belknap v. Partners Healthcare Sys., Inc., No. 19-11437-FDS, 2020 WL 4506162 (D. Mass. Aug. 5, 2020). The District of Massachusetts permitted a putative class action under the Employee Retirement Income Security Act (“ERISA”) to proceed, finding that the term “actuarial equivalent” in ERISA § 1054(c)(3) has not been defined and that there is no agreement in the courts as to its meaning. Plaintiff alleges that the way in which Partners calculates the value of his joint and survivor annuity benefit violates ERISA. Defendants moved to dismiss the claims arguing, among other things, that § 1054(c)(3) does not require that actuarial equivalence be calculated using reasonable assumptions. The Court agreed with Defendants that there is no reasonableness requirement, given that ERISA provisions expressly indicate where reasonableness is required. However, the Court also found that there was no clear definition of what it means for two retirement benefit forms to be actuarial equivalents. The term is not defined anywhere in ERISA and courts have not agreed to the definition. Given the lack of clarity in the statute and case law, the Court denied Defendant’s motion to dismiss.
Evans v. Diamond, 957 F.3d 1098 (10th Cir. 2020). Plaintiff Estate (“Estate”) of Decedent brought an action against the former wife of Decedent, arguing that Defendant improperly retained monies she received from Decedent’s Thrift Savings Plan account (“TSP account”) because she had waived her interest in the account through a divorce decree. Defendant moved to dismiss the Estate’s complaint, arguing that the Estate’s claims were preempted by federal law. The lower court agreed and held that the Federal Employee Retirement Systems Act (“FERSA”) preempted any conflicting state property rights, and dismissed the Estate’s complaint. The Tenth Circuit affirmed, reasoning that FERSA sets forth an express order of precedence regarding distributions of account proceeds. Under this order of precedence, which applied to the TSP account at issue, a decedent’s benefits “shall be paid” to the designated beneficiary and recovery by any other individual is barred. Based on this language and similar language addressed by the United States Supreme Court in Hillman v. Maretta, 569 U.S. 483 (2013), the Tenth Circuit held that any order requiring Defendant to hold monies from the TSP account in a constructive trust would frustrate the distribution scheme set forth by Congress in FERSA. Accordingly, the relief sought by the Estate under state law would interfere with FERSA and was thus preempted.
Mickell v. Bell, 2020 U.S. App. LEXIS 32516 (11th Cir. (Fla.) Oct. 15, 2020). In an ERISA action brought by a former NFL player, the Eleventh Circuit reversed and remanded the trial court’s order that had granted summary judgment to the Bert Bell/Pete Rozelle NFL Players Retirement Plan. In his suit, Mickell detailed a lengthy series of denials, appeals, reapplications and conflicting physicians’ evaluations that led him to finally sue the Plan’s retirement board in 2015. The Eleventh Circuit held that the board abused its discretion when it denied Mickell’s application for total and permanent disability benefits for injuries that occurred during his football career. According to the Court, the board had “wholly failed to consider” the player’s medical records and reports from his treating physicians that contradicted the findings of the board’s physicians. Furthermore, the board had not considered the cumulative effects of the player’s various impairments on his ability to work, an inquiry that was an “important consideration in the question of whether he was disabled.” In January 2021, the Eleventh Circuit issued an order declining to rehear its decision.
§ 15.11.2 Hostile Work Environment
Rasmy v. Marriott Int’l, Inc., 952 F.3d 379 (2d Cir. 2020). Plaintiff Gebrial Rasmy, a banquet server at JW Essex House, appealed from a judgment that granted Defendant Marriott International, Inc.’s motion for summary judgment, thereby dismissing Rasmy’s claims brought under Title VII and Section 1981 alleging a discriminatory hostile work environment and discriminatory retaliation. The Second Circuit reversed. On the harassment claims, the Second Circuit held that the district court misperceived and overstated the importance of certain elements of proving a hostile work environment. The Second Circuit agreed “it was error for the District Court to conclude as a matter of law that certain Defendants calling Rasmy a ‘rat’ or allegedly filing false workplace complaints against him did not constitute discriminatory actions. Likewise, the district court erred in dismissing as “stray remarks,” “comments that Rasmy overheard that were not directed at him but allegedly were purposefully made to others in his presence.” The Second Circuit explained that “conduct not directly targeted at or spoken to an individual but purposefully taking place in his presence can nevertheless transform his work environment into a hostile or abusive one, and summary judgment for Defendants on this basis was unwarranted.” The district court also put improper weight on the absence of physical contact to conclude the harassment Rasmy faced was not severe and had little impact on his job performance. “Although the presence of physical threats or impact on job performance are relevant to finding a hostile work environment, their absence is by no means dispositive. Rather, the overall severity and pervasiveness of discriminatory conduct must be considered.” On the retaliation claim, the Second Circuit found a genuine dispute of material fact about whether Rasmy’s filing of a claim with the EEOC caused his termination, as Rasmy asserted that the head of HR verbally abused him and threatened to fire him if he disclosed anything that happened at the hotel.
Legg v. Ulster Cty., 979 F.3d 101 (2d Cir. 2020). Female employees of the Ulster County Jail alleged they faced a hostile work environment based on sex (i.e., sexual harassment), in violation of Title VII and Section 1983. The case went to trial, where the jury found in favor of one of the three plaintiffs, Patricia Watson, and awarded her $400,000. The Second Circuit affirmed, finding that the district court carefully considered the evidence in the trial record and found that the testimony given by the three plaintiffs concerning the pervasive presence and use of pornographic magazines and screensavers (including by supervisory officers), sexual comments made by various officers about Watson’s body, and several specific incidents with one officer were sufficient for a reasonable jury to conclude that Watson was subjected to a hostile work environment. The Court noted that it has “repeatedly held that the presence of pornography in a workplace can constitute a hostile work environment.” The Court also rejected the jail’s claims that the incidents took over a prolonged period of time.
§ 15.11.3 Jurisdiction
Urquhart-Bradley v. Mobley, 964 F.3d 36 (D.C. Cir. 2020). Plaintiff, a former executive employee who is African American and female, sued her employer and the CEO who resided in Illinois, claiming race and gender discrimination in violation of § 1981 and the D.C. Human Rights Act. The district judge granted the CEO’s motion to dismiss for lack of personal jurisdiction and, subsequently, granted Plaintiff’s unopposed motion to enter final judgment on her claims against the CEO. On appeal, the D.C. Circuit found that Plaintiff had not forfeited her appellate challenge to the fiduciary shield doctrine. Consequently, the Court determined that the fiduciary shield doctrine did not apply, and that Plaintiff had justified her request for jurisdictional discovery with respect to the CEO’s contacts with the District of Columbia. Thus, the Court reversed and remanded the case to district court.
Harris v. KMI Indus., Inc., 980 F.3d 694 (9th Cir. 2020). Plaintiff brought a putative class action complaint against Defendant in state court, alleging that Defendant failed to provide required meal and rest breaks. Defendant invoked the Class Action Fairness Act of 2005 (“CAFA”) to remove the case, and it introduced a declaration from its human resources director to show that the jurisdictional amount was satisfied. The district court granted Plaintiff’s motion for remand to state court, finding that Defendant relied on unreasonable assumptions to reach the required $5 million threshold. The Ninth Circuit affirmed, holding that Plaintiff successfully made a “factual” rather than a “facial” attack on Defendant’s amount-in-controversy calculations, because he contested the truth of Defendant’s factual allegations—specifically, that Defendant failed to demonstrate in its calculations that class members worked shifts long enough to qualify for meal and rest periods.
Salter v. Quality Carriers, Inc., 974 F.3d 959 (9th Cir. 2020). Plaintiff brought a putative class complaint against Defendant, alleging that it underpaid California truck divers by misclassifying them as independent contractors. The Ninth Circuit ruled the district court erred in granting the Plaintiff’s motion to remand the action to state court, because it applied the wrong standard regarding proof of the $5 million jurisdictional threshold under the CAFA. The Ninth Circuit explained that only when a plaintiff mounts a “factual,” as opposed to a “facial,” attack on a defendant’s jurisdictional allegations, does the burden shift to the defendant to produce proof supporting its amount-in-controversy allegations. Here, the Court erred in treating Defendant’s attack on Plaintiffs’ amount-in-controversy presentation as factual, when the attack was purely facial.
§ 15.11.4 Protected Speech
La Liberte v. Reid, 966 F.3d 79 (2d Cir. 2020). The Second Circuit split with the Ninth Circuit, concluding that California’s statute to avoid strategic lawsuits against public participation (i.e., anti-SLAPP statute) does not apply in federal court. Serving as somewhat of a hybrid motion to dismiss/motion for summary judgment, California’s anti-SLAPP statute provides defendants a procedural device with which to obtain early dismissal of a plaintiff’s claim that targets conduct implicating the defendant’s constitutional rights of speech and petition. If the defendant proves that the complaint targets such “protected” conduct, then the plaintiff must make a showing sufficient to defeat a motion to dismiss or a motion for summary judgment. If the plaintiff cannot, the claim is dismissed. In reaching its decision, the Second Circuit concluded the California’s anti-SLAPP statute is entirely inapplicable in federal court because it conflicts with the Federal Rules of Civil Procedure governing motions to dismiss and motions for summary judgment. The Court reasoned that a motion under the anti-SLAPP statute serves the same purpose as a motion to dismiss or a motion for summary judgment under the Federal Rules of Civil Procedure (i.e., dismissal of a claim prior to trial); however, the anti-SLAPP statute requires the plaintiff to make a showing higher than that required under the federal rules in order for the claim to survive to trial.
Bennett v. Metro. Gov’t of Nashville & Davidson Cnty., 977 F.3d 530 (6th Cir. 2020). Plaintiff, a former employee for the City of Nashville, sued after she was terminated for using a racial slur when discussing politics on Facebook. Defendant charged Plaintiff with violating three policies of the Metropolitan Government Civil Service and terminated her following paid administrative leave and a due process hearing. Plaintiff brought suit alleging retaliation under the First Amendment. Following a jury trial, the district court found in favor of Plaintiff. The Fifth Circuit applied the Pickering balancing test to Plaintiff’s First Amendment retaliation claim to determine whether an employee’s free speech interests outweigh the efficiency interests of the government as an employer. The Court found that the Pickering factors weighed in favor of Defendant and reversed the jury ruling, asserting that Defendant’s interest in maintaining an effective workplace outweighs Plaintiff’s interest in using racially offensive language.
Curtis v. Christian Cnty., 963 F.3d 777 (8th Cir. 2020). Plaintiffs, a pair of former deputy sheriffs, brought First Amendment retaliation claims against a newly-elected sheriff who fired them for supporting one of his political opponents in the election. The Eighth Circuit reversed the district court’s denial of qualified immunity to Defendant, finding that a deputy sheriff is in a “policy-making position for which political loyalty is necessary to an effective job performance,” as sheriffs are liable for their deputies’ actions, and deputies are “at-will employees who serve at the pleasure of the sheriff.” Thus, Defendant was entitled to fire Plaintiffs without violating their constitutional rights.
Henry v. Johnson, 950 F.3d 1005 (8th Cir. 2020). Plaintiff, a former police sergeant, brought a First Amendment retaliation claim against members of Missouri State Highway Patrol (“MSHP”), after suffering adverse employment actions for criticizing MHSP’s handling of a drowning incident. Plaintiff testified before a state legislative committee and in a litigation hearing about the drowning, and spoke to media and the victim’s family, and made social media posts about the possibility of corruption. The Eighth Circuit held that Defendants were properly granted summary judgment. The Court found that members of MHSP were entitled to qualified immunity from Plaintiff’s claim, because much of Plaintiff’s speech was unprotected due to the fact that it was more likely than not impeding his ability to perform his job duties as a police officer. His protected speech was not a substantial factor in the adverse actions against him, as MSHP demonstrated a deterioration in trust within Plaintiff’s troop, and that Plaintiff engaged in unprofessional behaviors that violated general orders.
Nagel v. City of Jamestown, 952 F.3d 923 (8th Cir. 2020). Plaintiff, a former city police officer, brought a First Amendment retaliation claim against the city and police chief, after being discharged for false statements made to an anonymous local television hotline, alleging misuse of government property by the Sheriff’s Department. The Eighth Circuit held that Defendants were properly granted summary judgment. Plaintiff failed to prove his speech as a public employee was protected by the First Amendment. Plaintiff’s statements to media made clear that his appearance was within the scope of his duties as a member of the police department, his speech was not a matter of public concern, and the city’s interest in preventing disruption and disharmony in the workplace outweighed the officer’s interest.
Tracy v. Fla. Atl. Univ. Bd. of Trs., 2020 U.S. App. LEXIS 35951 (11th Cir. (Fla.) Nov. 16, 2020). The Eleventh Circuit upheld a jury ruling that Florida Atlantic University fired James Tracy, a media professor, for violating his union contract. The Court affirmed the district court’s denial of a new trial on Tracy’s First Amendment retaliation claim. Tracy sued Florida Atlantic, a public college, for unfair termination in April 2016, alleging that it had violated his constitutional rights by firing him because he blogged conspiracy theories, including his belief that the Sandy Hook school shooting was a government hoax. Florida Atlantic claimed it fired Tracy for insubordination because he refused to follow its conflict-of-interest policy, which requires faculty to report non-school speech activities related to their “professional practice, consulting, teaching or research.” The district court granted Florida Atlantic summary judgment on five claims, and a jury ruled for the school on Tracy’s retaliation claim. The Eleventh Circuit determined that Florida Atlantic’s policy was not facially overbroad and did not constitute a content-based restriction on speech, and that Tracy had failed to present evidence showing arbitrary enforcement of the policy. Ultimately, the Court found there was “more than sufficient evidence to support the jury’s verdict.”
§ 15.11.5 Statute of Limitations
Thompson v. Fresh Prods., LLC, 985 F.3d 509 (6th Cir. 2021). Plaintiff brought an employment-discrimination action against her former employer under the ADA, ADEA, Title VII, and state law, alleging disability, age, and race discrimination. Upon her hire, Plaintiff signed a “Handbook Acknowledgment” that limited the time to file any claim or lawsuit arising out of her employment to no more than six months after the action took place. After being terminated, Plaintiff filed her lawsuit against Fresh Products. The district court granted summary judgment to Defendants on all claims, asserting that Plaintiff’s ADEA, ADA, and Title VII claims were untimely because of the signed Handbook Acknowledgement. Additionally, the district court found that Plaintiff failed to establish a prima facie case of discrimination on any of her claims. On appeal, the Fifth Circuit found that the limitation periods articulated in the ADA, ADEA, and Title VII give rise to substantive, non-waivable rights; thus, the contractual limitation did not render her claims untimely. Conversely, the Court did find that the handbook limited her state law claims. Next, using the McDonnell-Douglas framework to examine her discrimination claims, the Court found that Plaintiff had not established the prima facie case to show she was terminated due to her disability, age, or race. The district court’s grant of summary judgment was affirmed.
Olson v. U.S., 980 F.3d 1334 (9th Cir. 2020). Plaintiff contracted to work as a Reasonable Accommodation Coordinator at Defendant Bonneville Power Administration, and eventually went on leave under the FMLA due to increasing anxiety. Defendant did not provide Plaintiff notice of her FMLA rights. Plaintiff sued under the FMLA, arguing that Defendant willfully interfered with her FMLA rights by failing to provide her notice of them. The relevant statute of limitations under the FMLA is two years after the date of the last alleged violation, but the limitation is extended to three years for a “willful violation,” which the FMLA does not define. Plaintiff filed her complaint more than two years, but less than three years, after the last alleged violation, and she accordingly was required to show that Defendant’s conduct was willful to avoid the statutory time bar. The Ninth Circuit followed a number of circuits in ruling that the standard for “willful” violations under the FMLA is the same as that for willful violations under the FLSA—whether the employer knows, or shows reckless disregard, as to whether its conduct violated the act. Here, the Court did not find that Defendant acted willfully, as there was a “serious question” as to whether Defendant was required to provide notice. Defendant consulted with its legal department concerning Plaintiff’s status, attempted to bring Plaintiff back to work, and paid Plaintiff for hours worked while she was out on FMLA leave. Thus, the three-year statute of limitations did not apply, and Plaintiff’s suit was time-barred.
Hickey v. Brennan, 969 F.3d 1113 (10th Cir. 2020). Plaintiff, a former employee of the United States Postal Service (USPS), brought a discrimination claim against the Postmaster General on the grounds that USPS failed to accommodate her disability. Plaintiff was terminated for misconduct, after which she initiated a grievance procedure pursuant to a collective bargaining agreement. The grievance was referred to an arbitrator, who denied the grievance on the grounds that USPS had just cause to terminate Plaintiff. Plaintiff then contacted an Equal Employment Office (EEO) counselor and filed a formal complaint of discrimination. The agency dismissed Plaintiff’s claim on the ground that it constituted an inappropriate collateral attack on the union grievance procedure. Plaintiff appealed to the EEOC, which upheld the agency’s decision. Plaintiff then initiated her federal complaint of discrimination pursuant to the Rehabilitation Act. The district court granted summary judgment in favor of USPS on the grounds that Plaintiff failed to timely exhaust her administrative remedies, and the Tenth Circuit affirmed. Under 29 C.F.R. § 1614.105(a), which is applicable to certain government employers such as USPS, Plaintiff was required to initiate contact with an EEO counselor within 45 days of the alleged discriminatory action, regardless of whether she was also pursuing a union grievance. Plaintiff argued that her untimeliness should be excused and/or that USPS should be estopped from raising timeliness as an affirmative defense because the EEO counselor failed to advise Plaintiff of her rights and responsibilities. The Tenth Circuit found Plaintiff’s arguments unavailing because (1) Plaintiff was already beyond the 45-day time period when she contacted the EEO counselor, and (2) Plaintiff failed to show that the information she received from the EEO counselor was incorrect or otherwise prejudiced her ability to pursue her claims.
Rivero v. Bd. of Regents of Univ. of New Mexico, 950 F.3d 754 (10th Cir. 2020). Plaintiff brought a discrimination claim against his former employer, University of New Mexico Hospital (UNMH), alleging that it violated the Rehabilitation Act by (1) requiring that Plaintiff undergo psychiatric evaluations and (2) constructively discharging him based on a perceived disability. The district court granted summary judgment in favor of UNMH on all claims, and the Tenth Circuit affirmed. To establish an unlawful medical examination or disability inquiry claim under the Rehabilitation Act, Plaintiff was required to demonstrate that UNMH required Plaintiff to undergo a medical examination or that it made a disability-related inquiry. Plaintiff was aware of UNMH’s examination requirements more than three years prior to bringing his claim. Plaintiff argued that his claim was not untimely because he needed to first see his personnel file to determine whether UNMH’s examination request was consistent with business necessity. The Tenth Circuit rejected this argument, reasoning that business necessity is an affirmative defense for the employer, and therefore Plaintiff could bring his claim without first investigating this potential affirmative defense. As for his constructive discharge claim, Plaintiff was required to show that he was a qualified individual with a disability and that he suffered an adverse employment action because of his disability. Here, Plaintiff’s claim failed because he presented no evidence that UNMH discriminated against him due to a perceived disability. Accordingly, the Tenth Circuit affirmed summary judgment on both of Plaintiff’s Rehabilitation Act claims.
§ 15.11.6 Unfair Labor Practices / National Labor Relations Act
Napleton 1050 v. NLRB, 976 F.3d 30 (D.C. Cir. 2020). A split D.C. Circuit held that a Cadillac dealer violated the National Labor Relations Act (NLRA) when it “scapegoated” two mechanics as punishment for their colleagues’ decision to unionize, determining that the dealer’s knowledge of the mechanics’ union views was not necessary to establish their terminations as illegal. According to the Court, “[i]ntentional discrimination against the statutorily protected collective actions of employees remains discrimination even when it takes the form of scapegoating.” Under prior precedent, the NLRB’s general counsel must show that protected activity motivated an employer’s adverse employment action; however, the general counsel need not prove that the employer knew each affected employee’s union views if it intended to punish the workers as a whole. The Court rejected the dealer’s argument that the NLRA requires evidence of mass layoffs, finding that “[t]here is no two-free-bites rule under Section 8(a)(3)” of the NLRA. The majority also rejected Napleton Cadillac’s assertion that it couldn’t have retaliated against its workers for engaging in a strike by removing their toolboxes from the work site, noting that a key decision maker at the dealer specifically said that the workers were treated differently because they chose to participate in the strike. In December 2020, the full D.C. Circuit declined to review the decision en banc.
Doughty v. State Emps. Ass’n of N.H., 981 F.3d 128 (1st Cir. (N.H.) 2020). The First Circuit affirmed the District Court ruling that a backwards-looking Janus-based claim for damages under 42 U.S.C. § 1983 is not cognizable. Plaintiffs are New Hampshire state employees who were required to pay agency fees to the State Employees’ Association of New Hampshire (“the Union”) as a condition of their employment with the state. After the Supreme Court’s ruling in Janus v. American Federation of State, County, & Municipal Employees that it was unconstitutional for such fees to be required of non-union employees, the Union stopped its practice of collecting agency fees from non-members. Plaintiffs filed suit after Janus and after the Union stopped collecting agency fees claiming that, based on Janus’ retroactive application, they were entitled to compensatory damages, refunds, or restitution under § 1983. In affirming the District Court decision, the Circuit Court looked to a body of precedent under § 1983 dealing with protection of reliance interests. The Court found that these Janus-based damages claims closely parallel common-law torts providing relief for a defendant’s misuse of official governmental processes. Such tort claims require a plaintiff to show malicious or improper use of process by the defendant. Considering that, prior to Janus, the practice of requiring agency fees from non-union employees was expressly permissible under Supreme Court precedent, the Court found that plaintiffs could not satisfy that malicious or improper use requirement. This ruling brings the First Circuit in line with other circuits that have addressed this issue since the Janus ruling.
Rizzo-Rupon et al. v. Int’l Ass’n of Machinists and Aerospace Workers, AFL-CIO Dist. 141, 822 Fed. App’x 49 (3d Cir. (N.J.) 2020). In an unpublished opinion, the Third Circuit held that the Railway Labor Act authorizes a union representing United Airlines workers to charge fees to nonmembers. The Third Circuit relied on the Supreme Court’s ruling in Ry. Emps. Dep’t v. Hanson, 351 U.S. 225 (1956), holding that if Hanson “remains good law, it bars appellants’ First Amendment challenge.” The workers challenging the union’s collection of fees pointed to Janus v. AFSCME, 138 S. Ct. 2448 (2018), in which the Supreme Court concluded that requiring agency fees from individuals who do not want to be union members violates their First Amendment rights. However, the Third Circuit distinguished the Janus decision, observing that “the ‘private-sector union shops’ analyzed in Hanson presented ‘a very different First Amendment question’ than the public-sector unions at issue in Janus.” In an order issued on November 2, 2020, the Third Circuit denied the worker’s en banc hearing request.
Diamond v. Pa. State Educ. Ass’n and Wenzig v. Serv. Emps. Int’l, 972 F.3d 262 (3d Cir. (Pa.) 2020). In a consolidation of two cases, a split Third Circuit held that public sector unions can keep the dues paid by nonunion members while the so-called fair share practice was still backed by the U.S. Supreme Court. The decision was in line with the decisions of four other circuit courts on the issue, determining that the public sector unions are afforded the “good faith” defense because they took the money when the fair share fees were still legally valid (i.e., prior to the Supreme Court’s holding in Janus v. AFSCME, 138 S. Ct. 2448 (2018)). The two judges in the majority were divided on their reasoning, with one judge echoing the Second, Sixth, Seventh, and Ninth Circuits that Section 1983 affords parties a good faith liability shield. The other judge supported the result but argued that the good faith defense is not part of Section 1983; instead, she relied on 19th century precedent to conclude that the public sector employees seeking to recoup the money they paid had failed to show their payments were made involuntarily or fraudulently. The dissent rejected the reasoning of both judges in the majority and called for the employees’ cases to be reinstated.
United Gov’t Sec. Officers of Am. Int’l Union v. Am. Eagle Protective Servs. Corp., 956 F.3d 1242 (10th Cir. 2020). A security officers’ union sued its member’s employer under Section 301 of the Labor Management Relations Act for declaratory relief under the union’s collective bargaining agreement and to compel arbitration of the employee’s grievance. The suit was brought nearly two years after the employer’s final refusal to arbitrate the employee’s grievance, and therefore the district court held that the union’s action was time barred. The primary issue was whether the court should apply the six-month statute of limitations applicable to unfair labor practices brought pursuant to the National Labor Relations Act (“NLRA”), or whether the Court should apply the six-year statute of limitations for breach of contract actions under state law. The Tenth Circuit held that the NLRA’s statute of limitations should apply, reasoning that the union’s claim to compel arbitration was more analogous to a labor dispute brought under the NLRA than it was to a state law claim for breach of contract. The Tenth Circuit further reasoned that there is a federal interest in the quick resolution of labor disputes, and that applying the NLRA limitation period to suits to compel arbitration in these circumstances would help ensure uniformity among the federal circuits. Accordingly, the six-month NLRA statute of limitations applied to the union’s claims in this case.
§ 15.11.7 Admissibility of Evidence
EEOC v. Performance Food Grp., Inc., 2020 U.S. Dist. LEXIS 46974 (D. Md. Mar. 18, 2020). The District Court found reports and testimony from experts from both parties to be relevant and denied the parties’ motions to exclude them. The EEOC alleged that a food distribution company engaged in a pattern or practice of gender discrimination in hiring for certain positions at its distribution centers. Defendant moved to exclude the EEOC’s expert reports and testimony, and the EEOC moved to exclude the testimony and reports of Defendant’s rebuttal expert. Applying Daubert, the Court analyzed the experts’ reports and testimony and found them to be relevant and reliable. In analyzing the motion to exclude the EEOC expert’s report and testimony, the Court stated that even if Defendant’s rebuttal expert’s criticism was valid, it did not require exclusion of the EEOC’s expert testimony and reports because she used accepted statistical methods. Whether a different statistical analysis was more appropriate would be a question of fact for the jury. The Court further explained that Defendant could address criticisms as to methodology on cross-examination. The criticism of the EEOC’s expert report and testimony, even if valid, did not reflect on the ultimate question. With respect to the EEOC’s motion to exclude the rebuttal expert reports and testimony, the Court denied the motion, holding that standards of relevance and reliability were met and that it would be helpful for the jury to hear about limitations on the EEOC expert witness’s methodology. Further, the rebuttal witness sufficiently explained his criticisms to be reliable, including that his methodology was clearly noted in his report.
§ 15.11.8 Determination of Employee Status
Cunningham v. Lyft, Inc., No. 1:19-cv-11974-IT, 2020 WL 2616302 (D. Mass. May 22, 2020). The District Court denied Plaintiffs’ Emergency Motion for a Preliminary Injunction, in light of the extraordinary circumstances caused by the COVID-19 pandemic, because Plaintiffs had not shown irreparable harm. Plaintiffs, drivers of Lyft, Inc., sued Lyft for misclassification as independent contractors under Massachusetts Law, and for expense reimbursement, minimum wages, overtime and earned sick time. The Court considers four factors when determining whether a preliminary injunction is warranted: (1) whether the applicant has made a strong showing of success on the merits; (2) whether issuance of the stay will injure other parties; (3) where the public interest lies, and (4) whether the applicant will be irreparably harmed absent a stay. Here, the Court found that: Plaintiffs demonstrated a substantial likelihood that Lyft drivers would be considered employees under the Massachusetts Independent Contractor Law; the balance of equities would favor the Plaintiffs because Lyft would suffer no meaningful harm if they provided the requested sick leave benefits; and, the public interest favored Plaintiffs because there is a strong public interest in the proper classification of workers and because Lyft drivers provide an “essential service” under Massachusetts law. However, the Court rejected Plaintiffs’ argument that they would suffer irreparable harm by contracting and infecting passengers with the coronavirus and contributing to the spread of the disease in the general public. The Court suggested that it could not find that Defendants would be the cause of that harm, especially considering that Lyft had not threatened to terminate drivers if they did not drive and had encouraged them not to drive if they were sick. Further, the Court distinguished harm to the public and harm to the Plaintiffs, and ultimately found that Plaintiffs themselves would suffer no irreparable injury as a result of misclassification.
Franze v. Bimbo Bakeries USA, Inc., 826 Fed. App’x 74 (2d Cir. 2020). Delivery drivers brought proposed collective and class action against Bimbo Bakeries USA, Inc. and Bimbo Foods Bakeries Distribution, LLC (“Bimbo”), alleging that Bimbo misclassified the drivers as independent contractors. The district court granted summary judgment to Bimbo, and the drivers appealed. The Second Circuit held that the record supported the district court’s determination that, under the five-factor test set forth in Brock v. Superior Care, 840 F.2d 1054 (2d Cir. 1988), the drivers were not Bimbo’s employees under the FLSA. For example, under the first factor, the Court agreed that Bimbo “did not control [the drivers] directly and closely enough to render their relationship an employer-employee relationship,” noting that the drivers (1) controlled the overall scope of their delivery operations, (2) were not required to deliver Bimbo products personally and could hire employees to substitute for them as needed, and (3) had no minimum-hour requirements and were free to set their weekly schedules. Similarly, the Court agreed that the drivers were independent contractors under the test outlined in Bynog v. Cipriani Group, Inc., 1 N.Y.3d 193 (2003), noting that the drivers set their own schedules and worked at their own convenience. While they did not work for any other companies, their distribution agreements made clear they were free to do so, and Bimbo exercised a minimal “degree of control” over the drivers’ day-to-day operations.
Razak v. Uber Techs., Inc., 951 F.3d 137 (3d Cir. (Pa.) 2020). Philadelphia-based UberBlack drivers filed a class action against Uber under the FLSA and Pennsylvania labor laws, alleging that the company misclassified them as independent contractors to deny them proper minimum and overtime wages. UberBlack is a higher-end service offered by Uber, where customers can select rides in luxury sedans or SUVs. A district court granted Uber summary judgment, determining that the drivers could not show that they were employees. However, the Third Circuit unanimously vacated and remanded the lower court’s decision, finding that the question of employment status is unclear and thus should be allowed to go to trial. The Court relied on Donovan v. DialAmerica Mktg., Inc., 757 F.2d 1376 (3d Cir. 1985), which articulates the standard for determining whether a worker is an employee under the FLSA. While the district court had found that Uber had the edge in four of the six Donovan factors, the Third Circuit held that the remaining two factors—whether Uber exerted enough of a “right to control” its drivers and whether the drivers had “opportunity for profit or loss depending on [their] managerial skill”—were still open for debate and must be resolved by either a jury or the district court through a Rule 52 proceeding. On November 5, 2020, the full Third Circuit issued an order declining to reconsider the panel decision.
Henry v. Adventist Health Castle Med. Ctr., 970 F.3d 1126 (9th Cir. 2020). Plaintiff, a general and bariatric surgeon, filed a Title VII complaint against the health center at which he performed surgeries for racial discrimination and retaliation. The Ninth Circuit affirmed the district court ruling in finding that Plaintiff was not entitled to Title VII protections, because he was an independent contractor and not an employee. The Court noted Plaintiff was “paid, taxed, and received benefits like an independent contractor,” he ran his own separate practice, and he had a degree of professional freedom and flexibility that pointed toward independent contractor status. The Court further found that, although Plaintiff was held to strict regulations in his work, which normally would weigh in favor of employee status, the regulations in the physician-hospital context were a “shared professional responsibility,” and therefore consistent with an independent contractor relationship.
§ 15.11.9 Punitive Damages
Ward v. AutoZoners, LLC, 958 F.3d 254 (4th Cir. 2020). Plaintiff Keith Ward sued his former employer for violation of Title VII and North Carolina law, alleging sexual harassment. A jury found AutoZone liable for creating a hostile work environment and for intentional infliction of emotional distress, and awarded Ward compensatory and punitive damages. AutoZone and Ward cross-appealed. With respect to the award of punitive damages, AutoZone argued that it was improper because traditional principles of agency did not apply to the managers’ conduct so as to make AutoZone vicariously liable. Consequently, the Fourth Circuit reversed and remanded. The Court reiterated that determining managerial capacity is a fact-intensive inquiry and involves examining the type of authority given to the employee and the amount of discretion the employee has. However, for liability to attach to AutoZone, one of Ward’s supervisors had to have acted with malice or reckless indifference. The Court found in AutoZone’s favor because Ward did not present sufficient evidence that the supervisors themselves engaged in intentional discrimination. Instead, at worst, they failed to adequately respond to discrimination by a lower-level employee, and they did not engage in the discriminatory conduct themselves.
§ 15.11.10 Miscellaneous
Little Sisters of the Poor v. Pennsylvania, 140 S. Ct. 2367 (2020). In a 7-2 decision, the Court held that private employers with religious or moral objections to birth control may be exempt from the contraceptive mandate of the Affordable Care Act (ACA). According to Justice Thomas, the ACA laid the groundwork for the Trump administration to issue exemptions to the contraception mandate, by delegating great authority to a U.S. Health and Human Services unit called the Health Resources and Services Administration (HRSA). Specifically, “[t]he ACA gives HRSA broad discretion to define preventive care and screenings and to create the religious and moral exemptions.” Justice Kagan filed a concurrence, joined by Justice Breyer, that agreed the exemptions complied with the ACA but suggested the “moral” exemption could be challenged on the grounds that it is “arbitrary and capricious.” The ruling upheld two regulations issued in 2018 that let employers avoid the ACA’s requirement to cover workers’ birth control by saying that they oppose contraception on moral or religious grounds. The regulations had been challenged by Democratic attorneys general in California and Pennsylvania, with district courts in both states enjoining the regulations nationwide. The contraceptive mandate has been heavily litigated over the past decade, with cases reaching the Court previously in 2014 (exempting closely held for-profits) and 2016 (failing to reach a compromise over an opt-out process for religious nonprofits and punting the issue back to lower courts). Following the Little Sisters of the Poor decision, on January 19, 2021, the U.S. District Court for the District of Massachusetts rejected Massachusetts’ claims that HRSA failed to follow proper Administrative Procedure Act requirements in promulgating the regulations. The district court also dismissed the state’s remaining constitutional and statutory claims, finding that the government “came to the reasonable conclusion that broader exemptions were appropriate to address sincere religious objections to the contraceptive mandate.” Similarly, the court concluded that the state had not established that the government failed to (1) consider alternatives, or (2) assess whether the hardships suffered by women denied contraceptive coverage outweigh the benefits offered by the regulations.
Woodlands Senior Living, LLC v. MAS Med. Staffing Corp., No. 1:19-cv-00230-JDL, 2020 WL 6875213 (D. Me. Nov. 23, 2020). The District Court found that a Maine statute prohibiting restrictive employment agreements does not violate the Contract Clause of the Maine Constitution and is applicable to contracts between an employer and a staffing agency. Woodlands Senior Living entered into a staffing agreement with MAS that established placement fees for temporary workers. In addition, the agreement prohibited MAS from recruiting or soliciting employees of Woodlands until 90 days after their last day of employment with Woodlands. Woodlands alleged that MAS violated said agreement, and MAS asserted that the newly enacted Act to Promote Keeping Workers in Maine, 26 M.R.S.A. §§ 599-A, 599-B, prohibited the enforcement of their agreement. Woodlands argued that MAS was not an “employer” within the meaning of that statute and that, even if MAS was an employer, the statute violated the Contract Clause of the Maine Constitution. The Court found that MAS (and staffing agencies generally) was an employer within the meaning of that statute. Further, the Court found that while the statute did substantially impair the parties’ contractual relationship, it was necessary to serve the important public policy of protecting workers, and prohibiting non-compete and anti-poaching agreements was a reasonable means of implementing said policy.
CVS Pharmacy, Inc. v. Lavin, 951 F.3d 50 (1st Cir. 2020). The First Circuit held that CVS Caremark, a subsidiary of CVS Pharmacy, was entitled to a preliminary injunction enforcing a covenant not to compete against a former longtime CVS executive hired by PillPack LLC, a direct competitor. When deciding whether the non-compete was enforceable, the First Circuit was faced with two competing views of reasonableness under Rhode Island law: a facial review of the covenant or an as-applied view of the covenant. Though the Court suggested that the as-applied approach may be a quicker and thus more workable view for courts, the Court did not take a position on which view was correct because, here, the outcome would be the same under either analytical framework. The Court ultimately held that the executive had extensive knowledge of CVS’s strategic planning and contracts with retail pharmacies and payors, and it was unlikely that he wouldn’t use this confidential information in his new job. Thus, barring his employment with PillPack for 18 months was reasonable, whether the trial court used an as-applied or a facial approach to assessing the reasonableness of the non-compete agreement.
Greater Phila. Chamber of Commerce v. City of Phila., 2020 U.S. App. LEXIS 3598 (3d Cir. Feb. 6, 2020). The Third Circuit upheld a Philadelphia law designed to close pay gaps by banning employers from asking questions about a job applicant’s salary history. Specifically, the Court lifted an injunction, issued in April 2018 by the lower court, that had frozen the law. The Court also affirmed the district court’s decision not to block the law’s “reliance” provision, which bars employers from using applicants’ wage histories to set new salaries. The Third Circuit rejected arguments advanced by the Chamber of Commerce for Greater Philadelphia that the law violates the First Amendment, finding that the city had provided ample evidence that banning salary history questions would help women and minority job applicants by remedying historic discriminatory wage gaps. “The city merely ‘dr[ew] reasonable inferences based on substantial evidence’ that the inquiry provision would address the wage gap, and the district court erred when it ‘reweigh[ed] the evidence’ and ‘replace[d] [the city’s] factual predictions with [its] own.’”
Druding et al. v. Care Alternatives, 952 F.3d 89 (3d Cir. (N.J.) 2020). The Third Circuit ruled that a district court erred when it granted summary judgment in favor of a hospice-care provider in a qui tam False Claims Act (FCA) action brought by former employees of the provider. Importantly, the Court reversed the district court’s requirement for the plaintiff-employees to show an “objective falsehood” to proceed with their FCA claims, instead holding that a subjective medical judgment can be deemed false for purposes of establishing liability under the law. “Regarding the element of falsity, the district court adopted a standard not previously embraced or established by this court, which required appellants to show evidence of ‘an objective falsehood,’ that the physician’s prognosis of terminal illness was incorrect, in order to prevail on the element of falsity.” The Third Circuit rejected the district court’s “bright-line rule that a doctor’s clinical judgment cannot be ‘false,’” finding this requirement to be “inconsistent with the statute and contrary to this court’s interpretations of what is required for legal falsity.” The Third Circuit observed that in the context of FCA falsity, its case law simply asks “whether the claim submitted to the government as reimbursable was in fact reimbursable, based on the conditions for payment set by the government.” The decision created a circuit split with the Eleventh Circuit, which held in United States v. AseraCare, Inc., 938 F.3d 1278 (11th Cir. 2019), that a difference of reasonable physicians’ opinions on a terminal patient’s prognosis alone does not constitute falsity under the FCA. The Supreme Court denied the petition for certiorari filed by Care Alternatives. Druding et al. v. Care Alternatives, 2021 U.S. LEXIS 915 (U.S. Feb. 22, 2021).
Ezell v. BNSF Ry. Co., 949 F.3d 1274 (10th Cir. 2020). Plaintiff was employed as a conductor for BNSF Railway Company. Plaintiff sued BNSF pursuant to the Federal Employers’ Liability Act (“FELA”), alleging that BNSF was negligent by requiring Plaintiff to climb railcar ladders to check whether the railcars were loaded. BNSF moved for summary judgment, arguing that its railcars complied with all applicable safety regulations and that Plaintiff failed to offer any evidence of negligence. Plaintiff responded by claiming that BNSF could have provided safer alternatives to climbing the railcars, and that BNSF’s failure to do so was negligent. The district court granted summary judgment for BNSF, and the Tenth Circuit affirmed. The Tenth Circuit explained that there are four elements to a FELA claim: “(1) the employee was injured within the scope of his employment, (2) the employment was in furtherance of the employer’s interstate transportation business, (3) the employer was negligent, and (4) the employer’s negligence played some part in causing the injury for which the employee seeks compensation under FELA.” In affirming summary judgment in favor of BNSF, the Tenth Circuit reasoned that while BNSF owed Plaintiff a duty to use reasonable care in furnishing a safe workplace, the requirement that employees climb railcar ladders was reasonable and did not create an unsafe workplace. Plaintiff then argued that BNSF was required to provide the safest alternative available. The Tenth Circuit swiftly rejected this argument, reasoning that railroad negligence under FELA required Plaintiff to show that BNSF provided an unsafe workplace, not that it failed to provide the safest possible workplace.
Ruckh v. Salus Rehab., LLC, 963 F.3d 1089 (11th Cir. (Fla.) 2020). The Eleventh Circuit partially reinstated a whistleblower’s $348 million False Claims Act (FCA) jury verdict. Angela Ruckh had alleged that her employers, two skilled nursing facilities, were providing more care than patients actually needed or received. The jury had sided with Ruckh in February 2017, marking one of the largest FCA jury verdicts in history, but the district judge had overturned the verdict in January 2018, citing the Supreme Court’s holding in Universal Health Servs. v. Escobar, 136 S. Ct. 1989 (2016). Under Escobar, an alleged FCA violation must be “material” to the government’s decision to pay. Here, the district judge found that the government had not recouped claims or punished the nursing facilities even though it was aware of the disputed billing practices, showing that it did not consider the violations material. However, the Eleventh Circuit disagreed, holding that Ruckh had adequately shown the materiality of the facilities’ Medicare overbilling, where “[t]his plain and obvious materiality went to the heart of the [facilities’] ability to obtain reimbursement from Medicare.” The Court restored the jury’s verdict covering just over $85.1 million in Medicare claims, trebled under the FCA to $255.4 million, with statutory penalties also to be added. But the panel preserved the district court’s decision to overturn the jury’s verdict on Medicaid fraud claims, which comprised the remainder of the original verdict. According to the Court, Ruckh had failed to show that the alleged failure to prepare and maintain comprehensive care plans for residents was material, and to connect the lack of care plans to “specific representations about the . . . services provided.” The full Eleventh Circuit declined to rehear the case en banc.
§ 15.12 Notice and Damages
§ 15.12.1 Bad Faith and Consequential Damages
Porcupine Opportunities Program Inc. v Cooper, 2020 SKCA 33. This case summarizes an employer’s duty of good faith and fair dealing. Mr. Cooper had been employed for 33.5 years when he was terminated without cause. He brought a successful claim for wrongful dismissal and moral damages against his former employer. The employer appealed, arguing that the trial judge erred by awarding Mr. Cooper $20,000 in moral damages. The Saskatchewan Court of Appeal dismissed the appeal and outlined the legal principles that apply to moral damages. First, an employer has a duty to engage in good faith and fair dealing during the dismissal process, which requires the employer to be candid, reasonable, honest and forthright and to refrain from untruthful, misleading or unduly insensitive behavior. This applies to the employer’s pre- and post-termination conduct. However, the normal distress and hurt feelings resulting from dismissal are not compensable. The Court of Appeal concluded that the trial judge’s award of $20,000 for moral damages was justifiable because the employer: (i) falsely accused Mr. Cooper of committing theft, (ii) falsely claimed that Mr. Cooper communicated in an inappropriate and threatening manner with some of his former colleagues after he was terminated, and (iii) dishonestly alleged that the true reason for Mr. Cooper’s termination was that his position had been eliminated.
§ 15.12.2 Punitive Damages
There were no qualifying decisions this year.
§ 15.13 Costs
§ 15.13.1 Quantum
There were no qualifying decisions this year.
§ 15.13.2 Special Costs
There were no qualifying decisions this year.
§ 15.14 Human Rights
§ 15.14.1 Disability
Int’l B’hood of Elec. Workers, Local 1620 v Lower Churchill Transmission Constr. Emp’rs Ass’n Inc., 2020 NLCA 20. The union appealed a decision of Nova Scotia Superior Court which found that the employer could not accommodate an employee who was medically prescribed cannabis without suffering undue hardship. A grievance was filed on behalf of a union member who applied for two positions on the Lower Churchill Project, but was denied both positions when his approval for medical cannabis use came to the employer’s attention. The arbitrator found that since there is no scientific or medical standard from which it may be determined whether the grievor was impaired by cannabis, the employer could not accommodate the employee in a safety sensitive position without undue hardship. Upon judicial review, the Newfoundland Superior Court found that the arbitral decision was reasonable. However, the Newfoundland Court of Appeal disagreed. The Court held that the arbitrator’s decision was unreasonable because the employer failed to provide evidence necessary to discharge onus of demonstrating that accommodation of the grievor on an individual basis would result in undue hardship. It was unreasonable for the arbitrator to simply rely on the difficulties for assessing cannabis impairment on a medical or scientific standard, to conclude the employer could not accommodate the individual grievor. Accordingly, the matter was remitted for a determination as to whether there is another way to individually assess the grievor’s ability to perform the job safely, which might provide an option for accommodation without undue hardship.
§ 15.14.2 Sexual Orientation
There were no qualifying decisions this year.
§ 15.14.3 Government Programs
There were no qualifying decisions this year.
§ 15.14.4 Accommodation
There were no qualifying decisions this year.
§ 15.15 Contracts
§ 15.15.1 Calculation of Reasonable Notice
Matthews v Ocean Nutrition Canada, 2020 SCC 26. Mr. Matthews was constructively dismissed and argued that upon dismissal, he was entitled to the payments under the employer’s long-term incentive plan (LTIP) because the company was sold during the period of reasonable notice which Matthews claimed he was entitled to. The agreement provided that it was of no force and effect if the employee ceased to be a full-time employee on the date of the sale. The trial judge found that the employee was constructively dismissed and entitled to a reasonable notice period of 15 months. Further, the trial judge found that since the employee would have been a full-time employee at the time the business was sold (had he not been constructively dismissed) and that the LTIP did not unambiguously remove or limit his common law right to damages, the employee was awarded damages equivalent to what he would have received under the LTIP. The Nova Scotia Court of Appeal allowed the appeal in part, finding that the employee was not entitled to damages in relation to the lost LTIP payment because he was not an active full-time employee on the date of the sale, and the LTIP clearly limited entitlement to those who were full-time employees on the date of the sale. The Supreme Court reinstated the trial judge’s decision. The Court clarified that determining whether damages for the failure to provide reasonable notice includes bonus payments, courts must consider (i) whether, but for the termination, the employee would have been entitled to the bonus or benefit as part of their compensation during the reasonable notice period, and (ii) if so, whether the terms of the employment contract or bonus plan unambiguously take away or limit that common law right. In this case, had Matthews been given reasonable notice, he would have been a full-time employee on the sale date and, therefore, his damages reflected the loss of the opportunity to receive the payments under the LTIP.
Waksdale v Swegon N.A., 2020 ONCA 391. Mr. Waksdale was dismissed without cause after working for the employer for just over ten months. He then sued for wrongful dismissal. The employer conceded that the “termination for cause” provision in the employment agreement was void because it violated the Employment Standards Act, 2000 (ESA). Likewise, Mr. Waksdale acknowledged that the “termination without cause” provision complied with the minimum requirements of the ESA. The employer argued that it could rely on the “termination without cause” provision because it was not alleging that the employee was dismissed for cause. The motion judge agreed with the employer, holding that the “termination without cause” clause was a stand-alone, unambiguous, and enforceable clause. The Ontario Court of Appeal disagreed. It stated the motion judge erred in his interpretation of the employment contract by failing to read termination provisions as a whole and instead applying a piecemeal approach without regard to their combined effect. It found that when read as a whole, this termination clause was contrary to the ESA and therefore void. The Supreme Court of Canada denied the employer’s leave to appeal.
Bank of Montreal v Li, 2020 FCA 22. Ms. Li was terminated after working for the employer for almost six years. When her employment was terminated, Ms. Li signed a settlement agreement, which provided that she would accept a lump sum payment in exchange for releasing the employer from any and all claims arising out of the termination of her employment. However, shortly thereafter, she filed an unjust dismissal complaint under section 240 of the Canada Labour Code (“Code”). Under section 240, if the appointed adjudicator finds that the dismissal was unjust, he or she has broad remedial powers, which include awarding compensation and ordering reinstatement. Bank of Montreal argued that the arbitrator lacked jurisdiction, given the terms of the settlement agreement. However, the arbitrator held that section 168(1) of the Code prohibits employees from contracting out of their statutory right to bring an unjust dismissal complaint under section 240. This meant that even an employee who signs a full and final release may bring an unjust dismissal complaint within 90 days of their dismissal. The arbitrator’s decision was upheld by the Federal Court and Federal Court of Appeal, both of which found it to be a reasonable interpretation of section 168(1) based on existing jurisprudence from which the Federal Court of Appeal declined to depart. Leave to the Supreme Court was refused.
Abrams v RTO Asset Management, 2020 NBCA 57. In this case, a 29.5 year employee sued his former employer for wrongful dismissal after being dismissed without cause. The termination clause in the employee’s employment agreement provided that the employer “shall not be obliged to make any further payments” once it provides written notice or pay-in-lieu of notice. The Court held that this clause is void because it frees the employer from making “any further payments” to the employee once it had provided written notice or pay-in-lieu of notice. It noted that upon the cessation of employment, employees are entitled to vacation pay and accrued wages. The employee’s termination clause violates the Employment Standards Act (“ESA”) by absolving the employer from these obligations once it provides notice or pay-in-lieu of notice. The Court affirmed that if a part of a termination clause contracts out of a benefit under the ESA, the entire clause is void. Accordingly, the termination clause was found to be void and the employee was entitled to damages for common law reasonable notice.
Manthadi v ASCO Mfg., 2020 ONCA 485. The Ontario Court of Appeal clarified the common law approach to calculating the reasonable notice period for an employee hired by a successor employer. In this case, the employee had worked for the predecessor employer for 36 years when it was purchased by the defendant successor employer in an asset purchase transaction. The employee signed a release with the predecessor employer and was hired by the successor employer. A few months later, the employee was dismissed without cause. The employee sued for wrongful dismissal. The summary judgment motion judge held that the employee’s entire service for the predecessor corporation must be taken into account when calculating reasonable notice. The Ontario Court of Appeal overturned the motion judge’s decision on the basis that summary judgment was inappropriate in this case because the question of whether the employee was hired on an indefinite basis or a fixed-term basis had to be determined, since the notice obligation depended on this finding. The Court also clarified the relevant legal principles concerning reasonable notice for employees of the vendor hired by the purchaser on an indefinite basis following an asset sale. First, a court may recognize an employee’s service with the predecessor employer to determine the reasonable notice period; however, the appropriate notice period is assessed by taking into consideration all of the circumstances. Second, the common law recognizes an employee’s prior service with the predecessor employer when: (i) the successor employer buys the predecessor employer as a going concern, (ii) the employee enters into a new employment contract with a new employer, and (iii) their connection to the ongoing business undertaking is continuous. Third, the factual matrix surrounding any settlement agreement entered into by the employee and the predecessor employer—including its terms and conditions—may also be taken into consideration.
Battiston v Microsoft Canada Inc, 2020 ONSC 4286. Mr. Battiston was dismissed without cause after working for Microsoft for 23 years. As part of his compensation, he received stock awards each year based on his performance. The terms of the Stock Award Agreements stated that awarded but unvested stock would become void once an employee is terminated without cause. When his employment was terminated, Microsoft informed him that pursuant to the terms of his Stock Award Agreements, all of his unvested stock awards were now null and void. The employee sued, arguing that he was entitled to his awarded but unvested stock. The Ontario Superior Court of Justice held that an employer must take reasonable measures to draw an employee’s attention to harsh and oppressive terms in an employment related contract. It found that termination provisions found in the Stock Award Agreements were harsh and oppressive as they precluded the employee’s right to have unvested stock awards vest if he was terminated without cause. The Court also accepted that the employee was unaware of the stock award termination provisions, and that these provisions were not brought to his attention by the employer. It found that an annual email communication about the notice of stock awards provided each year did not amount to reasonable measures to draw the termination provisions to Battiston’s attention. Accordingly, the termination provisions in the Stock Award Agreements were unenforceable and the employee was entitled to damages in lieu of the awarded but unvested stock.
§ 15.15.2 Changes to Contractual Terms—Constructive Dismissal
Quach v Mitrux Servs. Ltd., 2020 BCCA 25. This decision is a reminder of the general principle that modification of a pre-existing contract will not be enforced unless there is a further benefit to both parties. In this case, the employee signed a fixed-term contract with the employer, which provided that upon termination by employer, the balance of salary owed for the remaining portion of the term would be payable to the employee. The parties later signed a second month-to-month contract to replace the first contract. The employer then dismissed the employee before his employment began. The employee successfully sued for damages under the first contract. The trial judge held that the employer failed to establish fresh consideration for the second contract and awarded the employee damages for his lost salary under the first contract. The trial judge awarded $15,000 in aggravated damages based on the employer’s bad faith conduct and the impact it had on the employee. The employer appealed. The British Columbia Court of Appeal held that the trial judge correctly found that the second contract failed for lack of consideration. However, the Court overturned the aggravated damages award based on the lack of evidence that the employee suffered any harm beyond the “normal stress and hurt feelings” associated with termination of employment.
§ 15.15.3 Fixed vs. Indefinite Term Employment
There were no qualifying decisions this year.
§ 15.15.4 Codes of Conduct
There were no qualifying decisions this year.
§ 15.15.5 Pensions
There were no qualifying decisions this year.
§ 15.16 Definition of Employee
§ 15.16.1 Determination of Employee Status
CUPW v Foodora Inc., 2020 CLLC 220-032. The Union filed an application for bargaining rights over the employer’s food delivery couriers in Toronto and Mississauga for Foodora Inc. At issue was whether the couriers were “dependent contractors” under the Ontario Labour Relations Act (“LRA”), and therefore able to unionize. The employer took the position that Foodora’s couriers were independent contractors and could not unionize. The Ontario Labour Relations Board (the “Board”) held that Foodora couriers are “dependent contractors” because they more closely resemble employees than independent contractors. Foodora’s couriers were selected by Foodora and required to deliver food on the terms and conditions determined by Foodora in accordance with Foodora’s standards. The Board noted that: (i) Foodora’s app was the central “tool” used in the work, over which Foodora had full control, (ii) Foodora couriers did not have the opportunity to increase their compensation through anything other than their labour and skill, and (iii) Foodora exerted control over when and where couriers work. This was the Board’s first decision with respect to “gig economy” workers.
§ 15.17 Torts in Employment
§ 15.17.1 Duty and Standard of Care
There were no qualifying decisions this year.
§ 15.17.2 Negligent Infliction of Mental Distress
There were no qualifying decisions this year.
§ 15.18 Wage Hour Issues
There were no qualifying decisions this year.