Below are short descriptions of recent decisions from the United States Supreme Court, the United States Court of Appeals for the Ninth Circuit, the Washington State Supreme Court, and the Washington State Court of Appeals. There are also federal and state legislative updates.
Appellate Court Affirms Outrage Claim Yet Rejects Novel Theory
Division I of the Washington Court of Appeals decided Corey v. Pierce County, et al. The twenty-three page opinion has important and novel aspects. A former Pierce County prosecuting attorney sued the county and the county's prosecutor for several intentional torts. The employee's story was very detailed, and several causes of action were presented to the jury. The King County Superior Court judge instructed the jury on several causes of action, including wrongful termination, defamation, false light, and outrage.
The employer asked the trial court to decide as a matter of law that the defamation and false light claims were insufficient to go to the jury. The appellate court relied on the standard of review and discussed the distinction between defamation and defamation by implication in affirming the trial court.
The employer asked the trial court to decide as a matter of law that the outrage claim was insufficient to go to the jury. Outrage, which is sometimes called the intentional infliction of emotional distress, rarely is presented to a jury. It is rare because the conduct must be "so outrageous in character, and so extreme in degree, as to go beyond all possible bounds of decency, and to be regarded as atrocious, and utterly intolerable in a civilized community. The employer also relied on a case called Dicomes, claiming that the Supreme Court ruled as a matter of law that even an allegation that the defendant employer had created an intentionally false report for the sole purpose of embarrassing and humiliating the plaintiff was not sufficient to make out a prima facie case of outrage. But, this does not accurately portray the statements in Dicomes. The appellate court concluded that “mere insults and indignities, such as causing embarrassment or humiliation, will not support imposition of liability on a claim of outrage,” and that “[a]t worst, plaintiff’s allegations amount to a showing of bad faith.” Dicomes did not establish sufficiently outrageous behavior to warrant liability. At trial, the jury was instructed that the outrage claim did not apply to the resignation/termination but “can be considered for all other actions by Defendants.” The appellate court upheld the decision.
The jury was allowed to consider a novel claim of negligent dissemination of harmful information. The superior court judge tried to balance the First Amendment and the right to privacy, especially in light of a recent case allowing public school teachers a right of privacy in their identities when they were the subject of unsubstantiated allegations of sexual misconduct. The court of appeals discussed a potential theory arising out of the Public Records Act, but it disagreed with the new negligence theory. However, the jury's verdict was supported by other grounds, so this error did not require a new trial.
The employee was permitted to present a theory of promissory estoppel, yet her claims for breach of contract, express or implied, were rejected. The court of appeals affirmed this decision.
The superior court judge excluded several facts from evidence. The employer's appeal was also unsuccessful on this point.
The employee was entitled by law to recover her attorney's fees when she prevailed. However, her attorneys filed the request for fees late. They presented an argument to get around the deadline, but the court rejected the argument. The employee therefore could not recover her attorney's fees for all the time incurred up to and including trial. By prevailing on appeal, she recovered attorney's fees for the appeal.
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Employee-Attorney Sued Despite Arbitration Clause
The Washington State Court of Appeals, Division I recently decided Weiss v. Lonnquist. A law firm that focuses on representing employees against employers hired a lawyer using a written contract with an arbitration clause. The clause stated, in part: "Any dispute arising under this Agreement ... shall be submitted ... to binding arbitration." The contract was for a one-year term. About nine months later, the firm exercised its right to terminate the contract on 30 days notice. However, the firm retained the employed lawyer and paid her the same salary and benefits. About one year later, the firm terminated the employed lawyer. The lawyer sued the firm. The King County Superior Court decided that the suit was not subject to the arbitration clause, and the employer appealed. Division I avoided deciding whether the analysis turned on the Federal Arbitration Act or the Washington Uniform Arbitration Act. The appellate court decided that the employment was not under the contract. Despite term contracts sometimes renewing for the same length of time under the same contractual terms, this court held that the contract did not renew. The appellate court affirmed.
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Limited Remedies for ADA Retaliation Claims
On December 11, 2009, the U.S. Court of Appeals for the Ninth Circuit decided Alvarado v. Cajun Operating Co. Alvarado was terminated from Cajun, which owned a Church's Chicken restaurant. Alvarado was hired at age 65. He performed satisfactorily for three and a half years according to his job evaluations. He called the restaurant's hotline complaining that his manager made inappropriate comments about his age. The manager denied wrongdoing. Three days later, Alvarado received his first Performance Counseling Record concerning his purported failure to perform his job. The assistant manager gave him two additional counseling records, in the assistant manager's words because the manager told her to write them. Over the next nine months, Alvarado received four more similar records. Alvarado called the hotline again. When he complained about the pain in his hands when he worked in the walk-in refrigerator, his work referred him to a physician. The physician cleared him to work the same day after noting that he "suffered only from arthritis, a condition common among people his age." After he was terminated, he sued for discrimination on several grounds and retaliation for opposing age and disability discrimination.
The U.S. District Court granted Cajun's motion in limine, concluding that the plain language of the federal statute precluded compensatory damages, punitive damages, and trial by jury. The district court certified an interlocutory appeal on these issues, and the Ninth Circuit heard the appeal. Recognizing that the U.S. Supreme Court has not ruled on the narrow issue and that the several circuits are split on the issue, a three-judge panel decided that ADA retaliation claims do not provide compensatory or punitive damages. Because only equitable damages were available, the Ninth Circuit went on to decide that the plaintiff did not have the right to trial by jury. The Ninth Circuit affirmed the federal district court.
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When Employment Claims are Time-Barred
The Washington State Court of Appeals, Division III, recently decided Cox v. Oasis Physical Therapy, PLLC. Cox was an employee and a patient of Oasis PT. Oasis was co-owned by two physical therapists: Ms. Irvine and Mr. Shirinzadeh. Cox alleges that the male PT acted inappropriately and crossed boundaries with her as a patient and an employee.
Ms. Cox said she began working at Oasis in February 2004, saw Mr. Shirinzadeh as a patient in April-May 2004, and quit in August 2005. Cox cooperated with the Department of Health, Board of Physical Therapy in March 2007, and she filed suit on December 6, 2007. The defendants moved for dismissal arguing that all claims were time-barred by the statute of limitations. The superior court dismissed, and the court of appeals affirmed in part and reversed in part.
The dismissal of the medical malpractice claim was affirmed with some discussion. The remaining employment-related claims were analyzed and discussed. Portions of each claim survived dismissal.
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ADA Amendments Act of 2008 (ADAAA) is Not Retroactive
The U.S. Court of Appeals for the Ninth Circuit recently decided Becerril v. Pima County Assessor's Office. In that case, which came out of Tucson, Arizona, Becerril was employed in the mobile home section of the assessor's office. She had temporomandibular disorder (TMD). The assessor reassigned her to the public service section. She argued that the public service section was stressful and aggravated her TMD. She asked to be moved from that section, but her request was denied. When her request was denied, she sued claiming that the transfer was discriminatory and that the assessor failed to engage in the interactive process when he denied to retransfer her as an accommodation for her disability. The district court dismissed the case on summary judgment, and Becerril appealed.
The Ninth Circuit assumed that she stated a prima facie case of discrimination, and found that the employer articulated legitimate, non-discriminatory reasons for the action. The employer said there were complaints about the employee's misconduct. The employer stated that he was more concerned about the moral problem than the alleged misconduct, so he did not investigate the allegations. The employee did not believe the employer's reason, but her subjective believe was insufficient to establish her burden of proof. The Ninth Circuit held that the employee failed to show why the employer's reason was a pretext for discrimination. It went on to analyze the reasonable accommodation claim. It held that the ADA Amendments Act of 2008 (ADAAA) did not apply retroactively. Under the old law, which governed her claim, her TMD was not a disability under the ADA. The Ninth Circuit affirmed the dismissal.
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Court, Not Arbitrator, Decides Whether Case is Subject to Arbitration Agreement
Division II of the Washington State Court of Appeals recently decided a case about whether the court or the arbitrator determines the if a case is subject to arbitration in
Davis v. General Dynamics.
Davis was an employee of Contract Professionals, Inc., a contract house that provides workers to other employers. While he was a Contract Professionals employee, he worked for General Dynamics as a contract worker. In April 2006, General Dynamics hired him as an employee and he continues to work in that capacity. When he became an employee, he signed the Arbitration Agreement covering certain employment claims he may have against General Dynamics.
Davis filed a complaint for employment discrimination alleging race discrimination during the time he was a contract worker. The employer moved to dismiss the lawsuit alleging that Davis failed to arbitrate the matter. The trial court granted the motion to dismiss, stating, “I think that by signing this, [Davis] agreed to the arbitration of all claims arising out of his employment; and a lot of this is sort of those lovely little technical arguments.” The employee appealed. The appellate court held that the arbitration agreement did not apply to Davis’s claims arising out of his time as a contract worker. Instead, it applies to his “application for employment, employment, or termination of employment.” The trial court, not an arbitrator, generally determines the arbitrability of a dispute.
The appellate court interpreted what it viewed as the plain language of the agreement to arbitrate. The outcome may have been different if the agreement explicitly included pre-employment contract work.
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Physical Capacity Evaluation Violated ADA
On September 28, 2009, a divided panel from the Ninth Circuit decided
Indergard v. Georgia-Pacific Corp. Indergard worked at a GP mill facility. She took medical leave to undergo surgery for work-related and non-work related injuries to her knees. Her orthopedic surgeon released her to return to work, however, it was with permanent restrictions. GP required employees to participate in a physical capacity evaluation before returning to work from medical leave. GP contracted with an independent occupational therapy provider. A physical therapist visited the GP facility and conducted a job analysis for the position Indergard held before taking leave and for the next position which she was able to bid for under the collective bargaining agreement. Indergard reported to the occupational therapist for the two-day physical capacity evaluation. The court stated many case-specific facts.
Indegard claimed discrimination under the Americans with Disabilities Act (ADA) and under Oregon law against discrimination. She alleged the physical capacity evaluation was an improper medical examination in violation of 42 U.S.C. § 12112(d)(4)(A). The district court found that it was not a medical examination and dismissed the case. The employee appealed.
Two appellate judges sided with the employee. The appellate court listed seven factors from the EEOC Enforcement Guidelines and found that at least four weighed in favor of finding that it was a medical exam. The court seemed to find it especially important that the evaluation sought "information about [Indergard's] physical and mental impairments or health," and involved tests and inquiries capable of revealing whether she suffered from a disability. One judge dissented and felt that the evaluation was designed to determine whether the employee could perform her job. The dissent also pointed to cases from other circuits that would require a finding that the medical examination caused an injury or something more than a mere violation of the technical provision.
Employers should be careful when requiring evaluations, and employers may be liable under certain circumstances if the independent examiner conducts an evaluation that is later characterized as an impermissible medical examination.
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Employer Loses Due to Lack of Company Policies
The Ninth Circuit recently decided a case about an employee's access to sensitive company information and customer lists. In
LVRC Holdings LLC v. Brekka, et al., the employer filed suit against its former employee, the former employee's wife, and the couple's two consulting businesses. LVRC alleged that the defendants violated the Computer Fraud and Abuse Act (CFAA), 18 U.S.C. s 1030, by accessing the employer's computer "without authorization," both while he was employed and afterwards.
The employee e-mailed sensitive company information and customer lists to his personal computer while he was employed with the company. The employer had no written employment agreement. The employer had no written employee guidelines prohibiting employees from e-mailing company documents to personal computers. The district court found that accessing the documents while he was employed was not "without authorization" as that term is used in the CFAA. The Ninth Circuit's decision is in tension with the Seventh Circuit and creates a circuit split. The court also decided that the employer failed to prove as a matter of fact that the former employee accessed the computers after he was employed. Part of the analysis was that several people had access to the log-in and password, and the company failed to deactivate the account when the employee left the company. The district court granted summary judgment in favor of the former employee, and the employer appealed. The appellate court affirmed.
The lesson for employers is to draft and implement written policies protecting trade secrets and other sensitive information, and policies concerning the authorized use of computers.
This case was litigated under a federal statute in federal court in Nevada and affirmed on appeal by the U.S. Court of Appeals for the Ninth Circuit. The Ninth Circuit also reviews federal cases filed in Washington. If the case would have arisen under Washington law and been litigated in Washington State Superior Court or the U.S. District Court for the Eastern or Western District of Washington, the legal analysis under state law may have applied differently from the federal statute that was analyzed.
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EEOC v. Lowe's - Consent Decree
The EEOC sued Lowe's HIW, Inc., d/b/a Lowe's Home Improvement Warehouse, Inc., on behalf of three individuals. The EEOC alleged that Lowe's subjected the three to a hostile work environment, which was unlawful sexual harassment in violation of Title VII. When the three opposed sexual harassment, Lowe's apparently retaliated against them by wrongful termination. The suit was filed in U.S. District Court for the Wester District of Washington (i.e. federal court). On August 20, 2009, Judge John C. Coughenour entered a consent decree resolving the case. Lowe's was ordered to write an effective anti-harassment and anti-discrimination policy, and it covers stores in Washington and Oregon. It was also ordered to institute training and pay $1.72 million. The order requires Lowe's to notify the EEOC of any complaints of sexual harassment or retaliation for opposing sexual harassment by any of its employees.
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EEOC Sends New ADA Amendments Act Regulations for Comment
On June 17, 2009, the U.S. Equal Employment Opportunity Commission voted to approve and a proposed Notice of Proposed Rulemaking to conform its Americans with Disabilities (ADA) regulations to the ADA Amendments Act of 2008 (ADAAA). The proposed rules are now sent for comment by other federal agencies and the Office of Management and Budget. When this process is completed, the EEOC will publish the proposed rules for public comment.
We expect the EEOC's newly proposed rules will revise the term "substantially limits" as used to define "disability." The definition of "major life activities" will be expanded. Other changes are expected.
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U.S. Supreme Court Decides Firefighter Case
The high court decided a case of race discrimination brought by white firefighters in Ricci v. DeStefano. In 2003, 118 New Haven firefighters took examinations for promotion to lieutenant or captain. Promotional exams were done less than annually. When the examination results showed that white candidates outperformed minority candidates, public debate turned "rancorous." The city threw out the exam results.
Several white and Hispanic firefighters who likely would have been promoted based upon their good test performance sued the city and some of its officials. The suit claimed that throwing out the results violated Title VII of the Civil Rights Act of 1964 and the Equal Protection Clause of the Fourteenth Amendment. The district court granted summary judgment for the city, and the court of appeals affirmed.
The U.S Supreme Court concluded that the race-based action in this case was impermissible under Title VII unless the employer can demonstrate "a strong basis in evidence" that, had it not taken the action, it would have been liable under the disparate-impact statute. The record did not contain a strong basis in evidence that it would have been liable had it not thrown out the test results. As a result, the city's actions were a violation of Title VII. The Court did not reach the Equal Protection Clause issue.
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EEOC Filings Up
Individual filings with the Equal Employment Opportunity Commission (EEOC) in FY 2008 charging employers with discrimination were up 15.2% compared with FY 2007.
Basis of Charge Filing Fiscal 2008
Race 36%
Retalliation 34%
Sex or Gender 30%
Age 26%
Disability 20%
National Origin 11%
Religion 3.5%
Equal Pay Act 1%
The total does not equal 100% because filings often charge discrimination of more than one kind. The total number of filings for FY 2008: 95,402.
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U.S. Supreme Court Hears Mixed Motive Case
Should an employer be held liable when it demotes an employee in part for bad work performance and in part based on a worker's age when the company would have made the same decision had it only considered the employee's performance? Cases posing this issue are referred to as mixed motive cases. Some prior cases suggest that the employer must prove it would have made the same decision absent the impermissible basis. The lawsuit was filed under the Age Discrimination in Employment Act (ADEA). A jury awarded a verdict of $46,945 in lost compensation. The Eigth Circuit reversed and remanded for a new trial. The U.S. Supreme Court is considering this issue in Gross v. FBL Fin. Servs. Inc. Oral arguments were heard March 31st. A decision is expected this summer.
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Employment Handbook Case Favors Employee
Division One of the Washington State Court of Appeals decided
Duncan v. Alaska USA Federal Credit Union, Inc. Duncan was employed by the credit union and paid a commission. He alleged unfair treatment in adjusting the terms of his compensation. He retired in October 2006 and sued for breach of contract and a wage claim. The employer argued that he was an at-will employee and that his terms of employment were subject to change. The employee argued that the employment handbook promised specific treatment in specific circumstances. The trial court found for the employer and dismissed the case on summary judgment. The court of appeals reversed and held that the employee's case could proceed to trial. Employment handbooks can determine rights and liabilities in wage claims and employment litigation case, and employment handbooks should be drafted with care and reviewed during employment lawsuits.
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Service of Process
Service of process is giving notice of the lawsuit to the defendant by serving the summons and complaint. This is an important step in initiating any lawsuit. Under state law, this is governed by statutes and court rules. Only certain people may accept service. Failure to serve the right person prevents the court from obtaining personal jurisdiction over the defendant. By law, corporations and other business entities must have a registered agent to accept service of process. In,
Weber v. Associated Surgeons, P.S., the Washington State Supreme Court decided that service on a registered agent's office manager was sufficient. The defense had argued that the person served no longer worked for the corporation and therefore could not accept service. The court of appeals apparently adopted this argument, however, the Washington Supreme Court reversed. The Supreme Court's decision makes sense. Some businesses use an attorney or other professional to act as a registered agent for service of process. Businesses should update their registered agent if that person's employment changes.
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Collective-Bargaining Agreement Arbitration Clause Affects Age Discrimination Case
In 14 Penn Plaza LLC, et al. v. Pyett, et al., the United State Supreme Court held that a provision in a collective-bargaining agreement that clearly and unmistakably requires union members to arbitrate Age Discrimination in Employment Act of 1967 (ADEA) claims is enforceable as a matter of federal law. The union requested arbitration, but then it withdrew. Members filed charges of discrimination with the EEOC. The EEOC issued a right-to-sue notice, and an age discrimination case was filed. The district court denied a motion to compel arbitration, and the Second Circuit affirmed. On review, Justice Thomas, writing for the majority, wrote that the arbitration clause was enforceable and reversed the lower courts. Justice Kennedy sided with the majority in this 5-4 decision.
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Sixth Circuit Holds Burden-Shifting Does Not Apply to Mixed-Motive Cases
In
White v. Baxter Healthcare Corp., a divided panel for the Sixth Circuit Court of Appeals held
that McDonnell Douglas / Burdine burden-shifting framework does not apply to the summary judgment analysis of Title VII mixed-motive claims. (This case is on a fairly narrow point of law in an area too intricate to explain clearly in a summary for broad audiences. Depending on its application, it could make employment cases easier for employees to prosecute. It is also on an issue where the circuit courts are split, so this issue could be reviewed by the United States Supreme Court in the near term.)
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Ninth Circuit Avoids Answering Retroactivity of ADA Amendments Act of 2008
In
Rohr v. Salt River Project, the Ninth Circuit Court of Appeals decided a disability discrimination case. The district court dismissed the case on summary judgment. The opinion was filed February 13, 2009. The case was pending when the
ADA Amendments Act of 2008 was signed into law, however, the court avoided answering whether the ADAAA was retroactive. It held that an insulin-dependent type 2 diabetic was "disabled" under pre-ADAAA law, and found that there was a dispute of fact as to whether he was qualified to perform the essential functions of his job. The appellate court did not accept the employer's argument that the employee was unqualified for not obtaining the annual respirator certification, and it reversed and remanded for further proceedings.
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Attorney's Fees for an Action to Recover Unpaid Vacation
In
McGinnity v. AutoNation, Inc., Division III of the Washington State Court of Appeals decided a case on unpaid vacation days. AutoNation changed its vacation policy and allegedly refused to pay employees their unused paid vacation. The case was certified as a class action and went to arbitration. The arbitrator found for the class and awarded attorney's fees. AutoNation asked the superior court to set aside the award. The court refused, so the employer appealed. The appellate court held "that attorney fees under RCW 49.48.030 are not limited to judgments for wages earned for work performed, but are recoverable ... whenever a judgment is obtained for any type of compensation due by reason of employment."
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Washington State Human Rights Commission Warns of Age Discrimination in RIFs
The Human Rights Commission, which enforces anti-discrimination laws in Washington, released a
guide for employers to use in when considering and implementing a reduction in force (RIF) to avoid discrimination on the basis of age, including unintentional discrimination.
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Employer Insulated from Lower-Level Supervisor With Retaliatory Motive
In
Lakeside-Scott v. Multnomah County, the employee prevailed at trial, and the jury awarded $650,000. The employee had made statements about her supervisor that were personal to the supervisor. The employer conducted an indepedent investigation, and a higher-level manager made the decision to terminate the employee. The employee sued for retaliation in violation of her First Amendment rights and an Oregon whistleblower statute. There was a detailed discussion of the facts. The manager moved for a judgment as a matter of law arguing that the company's decision was independent from any retaliatory motive by a supervisor. The Ninth Circuit held that "a final decision maker's wholly independent, legitimate decision to terminate an employee [was] insulate[d] from liability [due to] a lower-level supervisor involved in the process who had a retaliatory motive to have the employee fired[.]" The court was clear that the holding would not apply in every similar case, but the court absolved the manager that terminated the employee in this case. The manager was not liable for retaliation as a matter of law.
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EEOC Pays Employer's Attorney's Fees
In
EEOC v. AGRO Distribution LLC, the Fifth Circuit affirmed the district court's award of attorney's fees in favor on the employer and against the Equal Employment Opportunity Commission (EEOC). The EEOC brought suit against AGRO for an alleged violation of the Americans with Disability Act (ADA) by failing to provide a reasonable accommodation to an employee and by terminating him on the basis of his disability. The employee had anhidrotic ectodermal dysplasia, which meant he could not sweat. Despite his condition, he worked in manual labor in Mississippi. He was assigned to load barrels on a trailer one July morning. When he could not get out of the shift, he did not show up to work. Under the law in effect at that time, the court held that his condition was not a disability and that the employer did not refuse to accommodate him. The court held that the issues were clear enough that the EEOC's continuation of the suit was not well-founded. The district court held the EEOC liable for the employer's attorney's fees, and the appellate court affirmed.
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Employment Implications of Stimulus Package
Congress passed
HR 1, the American Recovery and Reinvestment Act of 2009. President Obama is expected to sign the bill into law on Tuesday, February 16th. The bill affects several aspects of Consolidated Omnibus Budget Reconciliation Act (COBRA) Continuation of Coverage, unemployment compensation, executive compensation, and taxes. For example, employers who are subject to COBRA and provide notices of continuation of benefits must include information regarding premium assistance under the act. The Department of Labor will generate model notices. The effective date for the COBRA notice requirements is the first calendar month following the date of enactment (which is likely March 1st. Employers who accept money from the Troubled Asset Relief Program (TARP) are subject to executive compensation limitations and must take good faith steps to recruit U.S. workers before obtaining visas for workers.
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Attorney's Fees
In
McGuire v. Bates, the Washington Court of Appeals (Division I) decided that an offer to settle "all claims" did not include settling the issue that attorney's fees were warranted in from the case. A statute provides liability for attorney's fees to the prevailing party in some small cases. The court drew on analogous results under a court rule and federal precedent. Counsel should be clear when writing offers to settle, so that their clients are not burdened with paying more than they authorized to settle the case.
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Expect Litigation in 2009
The Puget Sound Business Journal reports that "One-third of U.S. companies expect more lawsuits in" 2009. Thirty-four percent of respondents to a survey of in-house counsel expected to see a "run-up" in litigation involving their firms in the next 12 months.
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Class Action for Race Discrimination in Pay
In
Parra v. Bashas', Inc., the Ninth Circuit Court of Appeals decided a case involving a class action for race discrimination. Current and former employees filed a class action alleging race discrimination, or national origin discrimination, in pay and working conditions. The district court certified the class on the working conditions issue and did not certify the class on pay discrimination. The lower court saw a problem with the class. The Ninth Circuit reversed and remanded finding that the standard to find commonality in a class action was a flexible one.
Leave for Domestic Violence Victims
In 2008, Washington State passed a law providing protected leave from employment for domestic violence victims. See Chapter 49.76 RCW. It provides for reasonable leave from work to accomplish specific tasks and protection from retaliation for taking the leave or acting as a witness. To learn more about this new law, please contact us.
In
Danny v. Laidlaw, a lawsuit arose from a time before the new statute was in effect. Mrs. Danny worked as a scheduling manager for Laidlaw. In February 2003, she had to move out of her house to protect herself from domestic violence but had to leave her children behind. In August 2003, she asked for time off work. She wanted to get her children away from her husband. Her project manager initially refused due to the press of business. She left work to move her children. When she returned, she again asked for leave to move her children into a shelter. She was given paid leave. About a month after returning to work, she was demoted to the position of scheduler, which she accepted. Laidlaw terminated her on December 3, 2003, and stated the reason as falsification of payroll records.
Danny sued Laidlaw for termination in violation of public policy alleging retaliation for taking leave connected to domestic violence. The statutory cause of action was not available to her, so she sued under a common law theory. When the defense moved to dismiss on the pleadings, the federal court asked the Washington Supreme Court a certified question about whether such a theory existed under state law. The Court answered that the claim did exist. Employers may be held liable under common law for terminating an employee because he or she took leave relating to domestic violence.
Employers and victims of domestic violence should familiarize themselves with the new statutory law, and employers should consider updating their company policies to accommodate the new leave policy.
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Genetic Information Nondiscrimination Act (GINA)
On May 21, 2008,
GINA became law. The new law protects information about a person's genetic composition and a person's family history of inherited traits and disorders. It is now illegal to discriminate in employment or eligibility for health care coverage because of genetic information. There are also restrictions on gathering and disseminating the information. The employment provisions become effective in November 2008.
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Employment Protection for Service Members
On September 5, 2008, the Ninth Circuit decided
Townsend v. University of Alaska. Townsend was fired from the university and sued in federal court claiming that he was terminated due to his military status with the air national guard. He sued under the Uniformed Services Employment and Reemployment Act of 1994 (USERRA). The university moved for dismissal contending that the federal court lacked jurisdiction to hear the suit, and Townsend moved to amend the complaint to add individual supervisors as defendants. The district court denied the amendment and dismissed the case. The Ninth Circuit affirmed holding that USERRA suits against state governments belong in state court, and that a claim against an individual supervisor fails. The former employer may only sue state and local governments in state court, rather than federal court.
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Court Upholds Judgment for Hanford Whistleblowers
On September 4, 2008, the Washington Supreme Court decided a case regarding employees at Hanford called Brundridge v. Fluor Federal Services, Inc. Eleven pipefitters sued their former employer, Flour, for wrongful termination in violation of public policy. Several important issues were decided.
First, one of the elements of termination violation of public policy claim requires that discouraging the conduct in which the employee engaged would jeopardize the public policy (the “jeopardy” element). A previous case leaned against the employer on this element, so the employer did not make it an issue at trial. Four months after the trial and while the case was on appeal, the Supreme Court decided another case that tipped this element back in favor of the employer. The employer raised the issue on appeal. The Supreme Court made new law governing when a party can raise an issue of a change in the law on appeal.
The Court defined new issues of law narrowly and prevented the employer from raising the new argument. This means the employer may deserve to win, but the Court will not consider its argument on appeal. This narrow reading of when there is a change in the law encourages parties to raise meritless issues at the trial court simply to preserve the issues for appeal.
Other important issues were decided in this case and will be analyzed soon.
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Pre-Employment Screening Must Be Reasonable
On June 20, 2008, the United States Court of Appeals for the Ninth Circuit decided
Nelson v. NASA. This case involves scientists, engineers, and administrative support personnel at the Jet Propulsion Labratory, which is run jointly by the National Aeronautics and Space Administration (NASA) and the California Institute of Technology (Caltech). The employees challenged a recent policy requiring "low risk" contract employees either to submit to in-depth background investigations or be deemed to have resigned. By "low risk," it is meant that none of the employees work with classified material. The employees sought a preliminary injunction, which the district court denied. They appealed, and the Ninth Circuit reversed holding that there were serious questions raised on two narrow issues about whether the employees would suffer irreparable harm.
The court was troubled by two areas of the background check. First, the form required employees to disclose "any treatment or counseling received" for any drug problems. Second, another form was sent to applicant's references, employers, and landlords. That form solicits "any adverse information" concerning "financial integrity," "abuse of alcohol and/or drugs," "mental or emotional stability," "general behavior or conduct," and "other matters." These were too open-ended. The court was persuaded that the employees had reason for a preliminary injunction on these two narrow grounds. Because the appeal concerned only the preliminary injunction, the case is on-going. Practical lessons are limited in that these employees did not work with classified information and that the employer in this case was restricted by the Constitution. Private employers are unlikely to spend such resources on a background check for "low risk" positions, and private employers are not restricted by the Constitution.
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A Decision That Is Based Upon Reasonable Factors Other Than Age Is an Affirmative Defense
On June 19, 2008, the United States Supreme Court decided
Meacham v. Knolls Atomic Power. In that case, the employer had a reduction-in-force and laid off employees. Of the salaried employees let go, thirty of thirty-one were at least forty years old. Twenty-eight of the former employees sued claiming the employer was liable under the Age Discrimination in Employment Act of 1967 (ADEA), 29 U.S.C. 621
et seq. A jury found that the decision had a disparate impact on older employees in violation of the ADEA and rendered a verdict against the employer. After a complicated appellate process, the Supreme Court accepted review.
Under the ADEA, there is an exemption for employer actions "otherwise prohibited" by the ADEA but "based on reasonable factors other than age" (RFOA). See 29 U.S.C. 623(f)(1). In other words, assuming the policy does not expressly refer to age (i.e. a facially neutral policy), a reasonable business practice is not unlawful even if it has a disparate impact on older workers. The Supreme Court was asked whether the employer or the employee bore the burden of persuasion. In a more or less unanimous decision, the Court held that the RFOA issue is an affirmative defense, which means the employer bears the burden of persuasion that the practice was reasonable. This opinion relates to the burden of proof at trial, so it does not change the standards of what is reasonable and does not significantly change the analysis a business would conduct to comply with the law.
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Air-Conditioned Truck is a Reasonable Accommodation in Phoenix
On June 16, 2008, the United States Court of Appeals for the Ninth Circuit decided
Gribben v. UPS. In that case, the employee drove a truck between UPS sites. The employee had a heart condition and said his cardiologist told him not to engage in certain activities for more than 20 minutes at a time in temperatures above 90 degrees Fahrenheit, or he would get dizzy and tired. He worked in Phoenix, Arizona. While he generally got an air conditioned truck, the employer would not guarantee one. When he did not get one, he sued for lack of reasonable accommodation.
The employer moved for summary judgment of dismissal. In arguing that the case should survive, the employee and the cardiologist gave evidence of his limitations, but they offered no evidence comparing his limitations to that of the normal person exposed to the same heat. The district court dismissed that claim. The Ninth Circuit reversed holding that (1) the employee need not need present evidence comparing his limitations to that of the normal person, but also that (2) the employee's testimony alone was sufficient to defeat summary judgment evidence so that he did not need the cardiologist's medical opinion.
The opinion clarifies the low threshold to establishing liability for failing to accommodate a disability. The case also had an aspect dealing with a retaliation claim that was not analyzed here.
Establishing liability for failure to accomodate is a delicate issue that would benefit from the assistance of an attorney.
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Prohibiting Race and Age Discrimination Also Prohibits Retaliation
On May 27, 2008, the United States Supreme Court decided
CBOCS West, Inc. v. Humpries and
Gomez-Perez v. Potter. In
Humpries, the Court analyzed whether 42 U.S.C. 1981, which prohibits discrimination in contracts, prohibits retaliation for opposing race discrimination. Although the majority concedes "that the statute's language does not expressly refer to the claim of an individual ... who suffers retaliation," it held that the statute does indeed provide such protection.
In Gomez-Perez, the Court faced a similar issue. A postal worker alleged retaliation for filing an administrative complaint concerning alleged violations of the Age Discrimination in Employment Act of 1967 (ADEA). The trial court dismissed the case, and the appellate court for the First Circuit affirmed. The Supreme Court reversed the lower courts, holding that the statute prohibited retaliation despite the absence of any express language on the issue.
Recently, the High Court found protection against retaliation in another statute that contained no such language. Jackson v. Birmingham Bd. of Ed., 544 U.S. 167 (2005) (holding that Title XI prohibits retaliation). Because retaliation in the employment context is already prohibited by state and federal law, the cases will have little or no practical impact, however, the Court continues a practice of finding liability despite the absence of a clear, statutory basis.
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Common Law Claim for Hostile Work Environment
On April 15, 2008, the Washington Court of Appeals issued a decision in
Candace Wahl v. Dash Point Family Dental Clinic. In that case, a female employee of a dental clinic alleged some serious incidents of sexual harassment by the male dentist. She quit and sued for sexual harassment. Because the clinic employed fewer than 8 employees, the Washington Law Against Discrimination (Chapter 49.60 RCW) had only limited application. However, the trial court applied the common law and found the employer liable at trial.
The employer appealed arguing that there was no such thing as a claim for sexual harassment or hostile work environment under the common law. The appellate court held that the employee proved a claim for wrongful termination in violation of public policy and affirmed the trial court.
Two lessons can be taken away. First, this case is a reminder that the court may always find that an employee who quits in reaction to a hostile work environment was "constructively discharged" and therefore wrongfully terminated. The other lesson is that even small businesses (i.e. employers with fewer than 8 employees) may be liable for employment discrimination.
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ADEA Procedural Decision
On February 27, 2008, the United States Supreme Court decided
FedEx v. Holowecki. The Supreme Court decided a procedural issue in a suit under the Age Discrimination in Employment Act of 1967 (ADEA). At issue was the definition of a "charge" of discrimination, which is a filing with the Equal Employment Opportunity Commission (EEOC). Whether and when a person files a charge with the EEOC is important in whether a lawsuit is properly brought. The trial court dismissed the case for violating procedures. In a 7-2 decision, the Supreme Court permitted the employee's suit to go forward. The dissent criticized the majority opinion, stating that the majority was holding that "a 'charge' of age discrimination ... is whatever the [EEOC] says it is," as opposed to recognizing that a charge of discrimination is a specific document.
The FedEx decision has little impact on future employee/claimants because the EEOC has made internal changes that make the same situation unlikely to happen again. Because the timing of the filing and the law suit are in the control of the employee, there are few practical lessons for the employer.
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Non-party "Me Too" Witnesses as Evidence
On February 26, 2008, the United States Supreme Court decided
Sprint/United Management Co. v. Mendelsohn. In that case, the trial court excluded evidence from non-party witnesses who would have testified concerning allegations of discrimination in other business groups and by supervisors other than the particular supervisor accused of age discrimination. The trial court's decision was very terse. The court of appeals for the Tenth Circuit concluded that the trial court must have applied the wrong analysis and reversed the decision. In a unanimous opinion, the Supreme Court reversed the appellate court and remanded the case for the trial court to clarify its ruling. The decision focused on the policy of deferring to the trial court on evidentiary decisions, so its wider application, while yet to be seen, is likely limited.
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Class of One Rejected In Employment Context
On February 8, 2007, a divided panel of the United States Court of Appeals for the Ninth Circuit decided
Engquist v. Oregon Dept. of Agriculture, et. al. First, some background. The equal protection clause of the U.S. Constitution, which prohibits treating similarly situated persons differently, restricts the government from intentionally and arbitrarily designing a statute to regulate one person as a class of one. However, there are reasons to analyze the government's actions in its role as regulator differently from its role as employer. While other circuits have applied the "class of one" analysis to the employment context, it had always been a theory because the court never found it to have occurred in any particular case. Meanwhile, the Ninth Circuit had never addressed the issue.
In Engquist, the Ninth Circuit was forced to address the issue and held that the class of one analysis did not apply to the employment context. The class of one theory in this context would be that the government employer is constitutionally prohibited (by the equal clause protection) from treating one employee arbitrarily. The majority recognized how this would impact the common law employment at will and rejected the argument.
Dissents, while common for the Supreme Court, are less common on three-judge panels at the courts of appeal. Judge Reinhardt dissented in this opinion.
The practical impact is limited. The jury verdict against the state was affirmed on other grounds. The jury still found the employer liable for the arbitrary treatment, but the decision was adjusted by the appellate court so as not to rely on the equal protection argument.