The WIB Legal Line is our new regular feature. Employment laws are confusing. The WIB LEGAL LINE updates members on developments that could impact your business. Robert E. Gregg is a partner in the Boardman Law Firm of Madison and has long been associated with WIB. Want to read even more employment law legal updates? Visit the WIB website, WWW.WIBIZ.ORG and click on LEGAL LINE.

LEGISLATIVE AND ADMINISTRATIVE ACTION 

President Obama steps up enforcement of USERRA rights for returning vets.  The Obama administration has reversed the previous administration’s decreased enforcement of veterans’ rights.  The President has ordered stepped-up Department of Justice action to investigate and vindicate the rights of those returning from military service.  Employers should review their USERRA policies and responsibilities to be prepared for reinvestigated enforcement.  (Also see later case on USERRA constructive discharge.)  Pension rights rule.  The administration has also proposed new USERRA pension rules.  Currently, if a person is on active duty when pension rights would vest, they are not considered to be an active employee and do not get vesting.  The new rule would count the service time for pension vesting. 

LITIGATION 

The Legal Update includes new developments and matters of interest throughout the United States.  Be aware that our various federal circuit courts reach somewhat differing conclusions.  So a federal court decision in another part of the country, and especially a different state’s court decision, may not quite be “the law” in your jurisdiction.  Some courts lead the way; others lag behind.  The Legal Update lets you see the overall trends and compare them with your jurisdiction.  Wisconsin is part of the Federal Seventh Circuit (Wisconsin, Illinois and Indiana).

Uniformed Services Employment and Re-Employment Rights Act (USERRA) 

Constructive discharge of police chief is actionable under USERRA.  A city police chief quit, then sued under USERRA for constructive discharge.  The court agreed that there was evidence of harassment and repeated violation of USERRA.  The chief’s Army Reserve unit was activated.  When he returned from duty, his annual evaluation from the city noted that he had been gone for most of the year and should make up for it by diligent attendance.  However, he was again called to active duty a year and a half later.  While on active duty, the city contacted him requesting he take a demotion because his military service was harmful to the city’s need for “continuity in leadership” of the police department.  He refused the demotion. 

 The city then “reorganized” to permanently shift many of the chief’s duties to another position and have the chief be a subordinate to that position.  When he returned, the chief objected to this, but loyally performed his reorganized job.  He was then subjected to seemingly unjustified close scrutiny and ordered to undergo psychiatric evaluation when he once reacted in anger.  The city mayor told him the psychiatric issue would “go away” if the chief would just resign.  Again he refused, and passed the evaluation as fully fit for duty.  Eventually he did resign due to the ongoing scrutiny and pressure.  He sued under USERRA for constructive discharge (forced to resign).  The court found sufficient evidence for a case of USERRA violation and constructive discharge.  It cited the overt criticism of the chief’s military service in the evaluation and the original request to resign; the reorganization eliminated significant duties, thus denying reinstatement to the same job; finally, “the many instances of harassment and coercion” appeared directly related to the chief’s active military duty and refusal to give up his USERRA rights.  Middleton v. City of Sherwood (D. Oregon, 2009).

Privacy/Confidentiality 

HR manager has $10 million verdict reversed due to improper use of company records.  A Human Resource manager sued her company for sex discrimination.  She remained employed during the suit, and during that time she took personnel records from the company which she believed helped her case and gave them to her attorney.  The company discovered this “theft” of records and discharged the HR manager.  She added a retaliation claim to her suit.  She then used the stolen records in the litigation, over the objection of the defendant.  A jury eventually awarded $10 million to the HR manager, much of it based on the “retaliatory” discharge.  The appeals court vacated the verdict, finding the trial judge failed to properly rule on the stolen personnel records and resulting discharge.  The court ruled that employees engaged in suits still have a duty to do their jobs properly.  Unauthorized taking of documents is not a protected activity, and discharge for that act is not illegal retaliation.  [The litigation discovery process allows a plaintiff’s attorney to obtain company documents properly, without “self help.”]  The court did not totally reverse the jury.  It allowed some of the original sex discrimination claims to stand, and remanded the case for a reassessment of the proper level of damages.  Quinlan v. Curtis-Wright Corp. (N.J. Superior Ct. of App., 2009).

DISCRIMINATION

Age

Age limit of 35 for firefighters is illegal.  The Montana Supreme Court struck down a state law which prohibited the original hiring of firefighters after age 34.  The court found “no rational basis” for the cut-off age.  The suit was brought by a 35-year-old, who was rejected, while those only a few months younger were hired.  Jaksha v. Bute-Silver Bow County (Mont. S. Ct., 2009). 

Disability

“Not deaf enough” - the dark side of cultural purity.  In Kimmel v. Gallaudet University (D.C., D.C., 2009), the court found in favor of a hearing-impaired Dean’s disability discrimination and retaliation claims under the Title VI of the Civil Rights Act, the D.C. Human Rights Act and tortuous interference with employment.  The Dean claimed that there is a significant “deaf culture” faction which is intent on ridding the school of people who are not “purely” deaf and who do not adopt sign language as their pure form of communication.  The Dean was not completely deaf and used other forms of hearing aids, along with sign language.  The Dean also opposed the efforts to purge the university of those who were not “culturally pure” enough.  As a result, she alleged that she was harassed by students and faculty; job responsibilities were taken away; she was ostracized, excluded from meetings, and defamatory falsehoods were printed and circulated about her.  The court rejected the university’s defense that the Dean was not disabled because she was “not deaf enough.”  The court found that her hearing impairment clearly was a disability.  Just like those who are discriminated against due to the shade of their color or their failure to match the stereotype of their gender, a disabled person can sue because of discrimination based on their level of disability, or one’s perception of disability.  This includes suits for harassment and cultural cleansing over one faction’s perception of what is an acceptable disabled person.  [This case is similar to the $4 million case, Blount v. Stroud, cited in the September Legal Update, in which an African American worker was retaliated against by African American management for not being “racially correct.”] 

Manager’s unfounded fears and failure to follow through result in liability.  A restaurant hostess with multiple sclerosis worked effectively except for occasional “flare-ups.”  She was Employee of the Month on several occasions.  “Flare-ups” resulted in leg numbness, difficulty walking, grasping and fatigue.  She had a flare-up, took a short medical leave and returned with no restrictions.  Several months later, she experienced another incident of leg numbness and informed the supervisor, who advised her to go home.  Two days later, she informed him that she had clearance to return with no restrictions.  However, the supervisor stated that he was “not comfortable” with her return because of possible (but undefined) “liability.”  He informed her she could not return until she had an independent fitness for duty exam, and he would contact her when the company selected a doctor.  There was no further communication by the manager, in spite of several follow-up requests by the employee and her attorney.  She filed for Unemployment Compensation as she waited for the fitness evaluation to be scheduled, but the manager then listed her as having “resigned” her job. 

 The court found that the employer failed to engage in the interactive process.  It had a right to require a fitness evaluation, but then failed to follow through.  Thus, it had no evidence of any inability of the employee to do the job.  In fact, the only evidence was the several “fully able to return” certifications from her doctor.  The employer’s actions appeared to be discrimination on the unfounded perceptions about a disability. Sensing v. Outback Steakhouse of Florida (1st Cir., 2009). 

Race 

Is “bubba” a racial term?  An African American city employee filed suit under Title VII and 42 U.S. Code §1981, claiming his discharge was due to race.  He claimed that his supervisor had called him “bubba” and sometimes used the terms “you people” and “your people” when talking to him about African Americans.  The evidence also showed the employee had a history of poor performance and discipline prior to the discharge.  The court found the evidence insufficient to show a hostile environment, stating, “Though we do not condone insensitive and boorish remarks,” they were not pervasive nor hostile and did not rise to a sufficient legal level.  Whether “bubba” is a racial term is questionable, since it is often used in reference to southern White men, and the plaintiff presented no evidence, except his own after-the-fact conjecture, that the name was used in a racial context.  He made no complaint while employed.  The court granted summary judgment, finding insufficient foundation for a case.  Stone v. Parish of E. Baton Rouge (5th Cir., 2009). 

Retaliation - Harassment of Contract Worker

Harassment of contracted employees and vendors.  A federal court has validated a 42 U.S. Code §1981 race discrimination and retaliation case filed by a contractor against Federal Express.  The plaintiff, S. K. Services, Inc., is a company which supplied janitorial services to FedEx facilities in Chattanooga.  The owner of S. K., who is White, complained to FedEx that one of the African American S. K. janitors was being called racial names and subjected to derogatory treatment by FedEx employees while he cleaned the building.  S. K. Services alleged that FedEx then retaliated by removing it from lists of authorized service providers, refused to consider it as a service provider for a new facility, and then cancelled its janitorial services contract at the existing facility.  The court found valid grounds for the case.  Discrimination against employees of a contractor or vendor can amount to discrimination against the contractor or vendor company itself.  42 U.S. Code §1981 guarantees the right to “negotiate, make and enforce contracts” without racial discrimination.  When a contractor or vendor who attempts to protect its own employees from racial harassment is met with retaliatory interference with the services contract, it creates a valid §1981 case.  S. K. Services, Inc. v. FedEx Ground Package Systems, Inc. (E.D. Tenn., 2009). 

An important message from this case is that organizations must not only assure a harassment-free respectful workplace for their own employees but also for third parties who come into the workplace.  This includes temporary or leased employees for which one is responsible as a “joint employer” and the employees of service providers and vendors with whom one has a contractual relationship subject to §1981. 

Sex 

Court approves $9.1 million settlement.  The Dell Computer Company has settled a class action case alleging discrimination against women in pay, promotion and conditions of employment.  In addition to payments to the class members, Dell will hire a labor economist to conduct a pay equity analysis and recommend further pay corrections and changes to pay practices.  An industrial psychologist will also be appointed to study and recommend changes in company practices regarding hiring, evaluation, promotion and retention.  Hubley v. Dell, Inc. (W.D. Texas, 2009). 

Religion 

Receptionist received voice from beyond.  In Windspear v. Community Development, Inc. (8th Cir., 2009), the court found sufficient evidence for a case of religious harassment under Title VII.  Windspear  worked for a family-owned company in which the owner’s wife was the receptionist.  Windspear’s brother had committed suicide, and Windspear had suffered a resulting period of intense grief, emotional distress and counseling.  The boss’s wife then began a campaign of telling Windspear that he should “use her as a medium to speak to his dead brother and find God, so he would not go to Hell like his brother.”  He replied that he was not interested, but she persisted daily, week after week, insisting he use her to find God.  He continued to ask her to stop.  He twice objected to the company owner, the receptionist’s husband.  Both times the owner told him that he should follow her advice and use her powers to contact the dead.  The behaviors continued for six months and resulted in renewal of Windspear’s severe emotional trauma regarding his brother’s death.  He then left the company and sued for the unwelcome, unrelenting religious harassment. 

Dreadlocks not the reason for discharge.  A lieutenant in a correctional facility claimed he was fired because he wore dreadlocks in accordance with his Rastafarian religious beliefs.  The court ruled that he was fired for violating security procedures, including failure to notice that a sick inmate had died in his cell, and for giving preferential treatment to a female guard under his supervision.  Though there had been some negative comments about the dreadlocks, there was no evidence to tie the comments to the discharge.  No one told the lieutenant he could not wear dreadlocks, and he had them at the time he was promoted to lieutenant, by the same management which fired him.  All evidence showed valid, non-religious reasons for the termination.  Booth v. Maryland (4th Cir., 2009).  

Catholic school elementary teacher is a “ministerial employee” - Wisconsin court adopts tight standard.  A 53-year-old grade school teacher was discharged after 30 years at a Catholic school.  She sued for age discrimination under the Wisconsin Fair Employment Act.  Her teaching duties included short religious lessons each week, leading students in prayer and incorporating religious themes into classes.  The Wisconsin Equal Rights Division and lower courts balanced these against her overwhelming “primary duty” of teaching standard educational topics and allowed her case to proceed.  This was the normal standard of analysis.  However, the Wisconsin Supreme Court rejected this standard and adopted a “qualitative” approach.  It ruled that a grade school teacher was “an important instrument in a faith-based organization’s efforts to pass on its faith to the next generation.”  Therefore, the Constitutional separation of church and state prohibited the state from interfering with the church school’s internal decisions regarding ministerial employees.  It dismissed the case.  Conlee Catholic School v. Labor Industry Review Commission (Wis. S. Ct., 2009).  The court also stated that this standard might not apply to secondary school teachers who spend only an hour or so a day with students and are more focused on the academic topic instead of being responsible for the full-day class environment like a grade school teacher. 

Fair Credit Reporting Act 

Failure to give notice.  The FCRA requires employers using a third party for employment background checks to have a special authorization form and give required notices.  In FTC v. Qualified Terminal Services and Rail Terminal Services, the defendants have agreed to pay $77,000 in penalties for failing to give proper notices for hiring, background checks, and background checks on existing employees.

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