Former Disabled Employees Lack Standing Under Title I of ADA
Three former auto industry employees accepted early retirement options under their employer’s pension plan. After the employees retired, they also began receiving Social Security Disability Insurance Benefits (“SSDIB”). As a result, pursuant to provisions in the pension plan, the employees’ pension benefits were reduced by the amount received in SSDIB benefits. The employees filed suit under Title I of the Americans with Disabilities Act (“ADA”), alleging that the pension plan did not provide equal access to disabled employees. Relying on the plain language of the ADA, the Sixth Circuit held that the former employees did not have standing to file suit. Acknowledging that federal appellate courts are split on the issue, the Sixth Circuit accepted the majority position that former disabled employees cannot be considered “qualified individuals” under the ADA. Consequently, such employees cannot file suit seeking protection under the ADA. Critical to the court’s analysis was the fact that the employees at issue were totally disabled, meaning they could no longer perform the essential functions of their former job. As the court put it, in order to seek protection under the ADA, an individual must be able to perform the essential functions of employment at the time the alleged discrimination occurred. While the Sixth Circuit’s holding represents a plain reading of the eligibility requirements under the ADA, employers should understand the limited nature of this holding, as former disabled employees who could still perform their job with a reasonable accommodation could have standing under the ADA. Additionally, pension plans that treat employees differently based on various medical conditions might still trigger liability under the Employee Retirement Income Security Act (“ERISA”).
McKnight v. General Motors Corp., No. 07-1479 (6th Cir., Dec. 4, 2008)
Contact for more information: Scott M. Gilbert
Former Employee Loses on EPPA Firing Claim, but Survives on Use of Polygraph Tests
A former bank employee claimed he was discharged in violation of the Employee Polygraph Protection Act. The employee became a suspect in an attempted robbery of the bank after he called a co-worker, claimed he had been kidnapped and was being held at gunpoint, and asked the co-worker to open the bank’s vault. Both the local police department and FBI notified the bank that the former employee had given deceptive answers to polygraph test questions, and that he was being considered a suspect in the FBI’s investigation. Bank officials determined that the former employee could not be trusted with customer deposits and made the determination to fire him, although they delayed notifying the bank employee of his termination to avoid impacting an ongoing investigation. The employee was subsequently terminated, however a state Employment Security Commission investigating the incident ultimately found that he was not involved in the robbery attempt. The former employee brought suit under the EPPA, claiming that the bank had terminated him on the basis of his polygraph results, and that is had “used, referred to, obtained, learned of, and/or inquired concerning the results of the polygraph examination.” The Fourth Circuit Court of Appeals held that the bank had established that it would have fired the employee, even without the knowledge that he had failed two polygraph tests, and affirmed the grant of summary judgment in favor of the bank. However, the court remanded the employee’s claim that the bank had “used, accepted, or referred to” the polygraph test results, holding that the employee did not have to be discharged to establish employer liability under the section. Accordingly, employers must be careful not to obtain, accept, use, or refer to employee polygraph test results in making employment decisions.
Worden v. SunTrust Banks Inc., No. 07-1354 (4th Cir. Nov. 24, 2008)
Contact for more information: Daniel L. Farris
Reasonable Accommodation May Be Limited by Collective Bargaining Agreement
A bus driver became unable to work due to the combined effects of a high-risk pregnancy, diabetes, and migraine headaches. The driver was initially placed on a disability leave of absence and was later transferred to disability layoff status. Pursuant to a collective bargaining agreement, the driver retained the right to displace the junior employee in any job classification equal to or lower in range than her position within the bargaining unit upon her return to work. Based on the driver’s seniority and classification range, however, the only position she had a right to demand within the bargaining unit was that of bus driver. When her physician’s authorization to return to work barred her from driving a bus, the driver asserted that the employer should accommodate her disability by allowing her to “bump” into a higher classification. The employer maintained that it had accommodated the driver to the extent possible under the parties’ labor contract. The Seventh Circuit Court of Appeals agreed with the employer, holding that it was not required to reassign a disabled employee to a position when such a transfer would violate a legitimate nondiscriminatory policy of the employer. The Court explained that a nondiscriminatory hiring and reassignment provision of a collective bargaining agreement qualifies as such a policy. Although the ADA recognizes reassignment to a vacant position as a potentially reasonable accommodation, employers should carefully evaluate whether the requested transfer would violate a legitimate nondiscriminatory policy of the employer.
King v. City of Madison, No. 08-2052 (7th Cir. Dec. 4, 2008)
Contact for more information: Jonathon D. Hoag
Definition of a “Comparable Employee” in Discrimination Cases
After an Asian American customer service supervisor was fired for waiving upgrade fees 12 times for a customer and accepting tips from him, the supervisor brought claims of discrimination and retaliation against her former employer. The Fifth Circuit Court of Appeals recognized that the plaintiff established that she was subject to an adverse employment action (firing), had been qualified for her job, and, as an individual from Indonesia, was a member of a protected class for national origin discrimination purposes. However, it held that she had failed to demonstrate her employer gave preferential treatment to a white employee under “nearly identical circumstances.” Applying the “nearly identical circumstances” standard, the court required that the plaintiff’s “comparators” must have engaged in similar conduct, had the same supervisor, and the supervisor must have been aware of the alleged misconduct. Because the plaintiff could demonstrate only seven other instances of misconduct, all of which failed to satisfy at least one of the three elements identified by the court, she failed to establish a prima facie case of national origin discrimination as a matter of law. Nonetheless, employers must be careful to apply disciplinary policies in an even and consistent manner.
Jursuf v. Southwest Airlines, Co., No. 08-10383, (5th Cir. Nov. 20, 2008) (unpublished)
Contact for more information: Jennifer M. Ballard
Union Can Arbitrate Retirement Dispute Without First Obtaining Consent of Retirees
A union attempted to arbitrate an employer’s changes to its medical plan, effectively eliminating retiree benefits. The collective bargaining agreement provided retirees medical benefits under a medical plan provision which covered all eligible employees. The union claimed that the employer could not make changes to the plan which would result in an overall reduction in retiree medical benefits. The employer refused to arbitrate on the grounds that the union lacked standing to represent the interests of the former employees who were no longer members of the union. The Ninth Circuit Court of Appeals held that the union had standing over the claim, reasoning that a denial of the right to arbitration affected the union in a “personal and individual way,” and would require the expense of either suing in federal court to compel arbitration or litigating the alleged violation of the CBA. The court therefore refused to require the union to obtain retiree consent, on the grounds that the possibility the employer may have to re-litigate a favorable arbitral claim in suits by individual retirees was an insufficient reason to justify the creation of a “consent rule.” Employers must be careful when modifying collective bargaining agreements in a way which would impact the previously bargained-for benefits of retired employees.
Int’l Bhd. of Elec.Workers, AFL-CIO Local 1245 v. Citizens Telecomm. Co. of Cal., No. 06-16189 (9th Cir. Dec. 5, 2008)
Contact for more information: Aimee E. Dreiss
Employee Wins Racial Discrimination Case on Credibility Determination
Upon arrival to a worksite in a rural area, an African-American city maintenance worker set off fireworks. The city maintenance employee’s supervisor reported the incident, and after an investigation, a city manager fired the employee for lighting fireworks on-duty. In turn, the employee filed a Title VII lawsuit, claiming that the employer’s stated reason was pretext for discrimination. In the ensuing trial, a former and two current workers testified that firecrackers were commonplace and that when other white employees set off fireworks, the white workers were not disciplined. Two of those witnesses testified that the supervisor who reported the African-American employee had witnessed other white employees throw firecrackers but had not reported the white employees. The trial pursued before a judge who determined that, due to the evidence presented by the employee, the judge believed that the employer’s witnesses were not credible. Therefore, the judge determined that although the reason given for termination could potentially be legitimate, due to the sheer weight of the credible evidence, more likely than not, the employer’s reason for termination was a cover-up or pretext for discrimination. The judge found in favor of the employee and awarded him $89,700.50 in lost compensation. The Sixth Circuit Court of Appeals affirmed the trial court’s decision. Cases such as this one often rise and fall upon the judge or jury’s determination of who is the more credible witness. Once a credibility determination has been made by the judge or jury, the losing party has a nearly impossible burden to achieve a reversal. Employers should ensure that disciplinary action is consistent regardless of race, gender, or religion.
Madden v. Chattanooga City Wide Serv. Dep’t, No. 08-5082 (6th Cir. Nov. 25, 2008)
Contact for more information: V. Brette Bensinger
Employee May Be Fired for Not Working Before Doctor’s Appointment
An employee scheduled a doctor’s appointment on a workday. She and her supervisor discussed that the employee did not have any leave time available, and so they agreed that she would report to work before her doctor’s appointment and then take an early lunch. The supervisor also printed out FMLA paperwork and suggested the employee consider the possibility of FMLA leave. On the morning of the doctor’s appointment, the employee’s car would not start, and so she did not report to work. The employee had her doctor complete the FMLA paperwork, but the employer fired the employee immediately upon her return to work before she could present the paperwork. The employee sued her former employer alleging interference and retaliation under the FMLA. The court explained even assuming she had properly put her employer on notice that she needed FMLA leave, the employee’s termination was unrelated to the FMLA leave. The employee was fired for failing to report to work before her doctor’s appointment, a time period that is not covered by the FMLA. The employee’s car failing to start was not a serious health condition, and her termination for that reason was therefore completely unrelated to the FMLA. Employers should be aware that when FMLA leave relates to serious health conditions, some portion of the time off may not covered by the FMLA.
Phillips v. Mathews, No. 08-1082 (8th Cir. Nov. 18, 2008)
Contact for more information: Justin M. Penn
Employee Complaining of Misuse of Union Program Was Not a Whistleblower Under SOX
A labor relations specialist for an airline complained first to the pilots’ union and then to her supervisors after noticing discrepancies in the airline’s flight-loss program. The pilots used this program when they had to miss flights to attend union meetings. The pilots union was to reimburse the airline in such cases. The specialist discovered that pilots were intentionally scheduling flights for days on which they were not originally scheduled to fly, but knew a union meeting would force them to miss the flight. The pilots were paid for days in which they were not scheduled to fly and, in fact, did not fly. The airline ultimately fired the specialist, after which she filed a Sarbanes-Oxley Act (“SOX”) whistleblower action, claiming retaliation. Holding that the conduct at issue must be “adverse to investors” and involve fraud or securities violations, the Fourth Circuit Court of Appeals rejected the plaintiff’s SOX claim. A billing discrepancy, without more, does not constitute fraud, and the plaintiff had failed to identify to her supervisors why she believed the discrepancies constituted fraud. Nonetheless, employers must be careful to fully investigate claims of misconduct, and to treat the employees who make the complaints with care.
Platone v. Dept. of Labor, No. 07-1635 (4th Cir. Dec. 3, 2008)
Contact for more information: Tom H. Luetkemeyer
Union May be Decertified Through Objective Evidence Showing Loss of Majority Support
The General Counsel of the National Labor Relations Board (“NLRB” or “Board”) recently issued an opinion to all NLRB Regional Directors, Officers-in-Charge, and Resident Officers, directing them on how to address charges that an employer unlawfully withdrew union certification in violation of Section 8(a)(5) of the National Labor Relations Act. The opinion attempts to clarify the circumstances in which a charge should be dismissed, have a complaint issued, or be submitted to the Division of Advice. The opinion makes particular note of Levitz Furniture Co. of the Pacific, 333 NLRB 717 (2001), in which the Board held that an incumbent union could be decertified if an employer showed sufficient objective evidence of loss of union support. Expounding on Levitz, the General Counsel stated that a charge should be dismissed where the employer has shown that a verifiable numerical majority of employees no longer support the union. Sufficient evidence may include: (a) an employee petition or letter to their employer with language specifically stating employee disaffection and interest in union decertification; or (b) a union steward report on the results of an employee poll showing lack of support for the union. However, an employer’s use of circumstantial evidence to show a “good faith doubt” of union support would no longer defeat a Section 8(a)(5) allegation. Cases that should be submitted to the Division of Advice would include instances where the employer’s proof of disaffection was based on disputed unit composition, ambiguous statements, hearsay, or of other questionable authenticity. Employers should be aware that this opinion changes the standard of proof from “good faith doubt” to now require a conclusive showing of employees’ union disaffection.
NLRB Memorandum GC 09-04
Contact for more information: Thomas Y. Mandler
Illinois Enacts Broad Anti-SLAPP Law
Illinois has recently enacted broad anti-SLAPP legislation, aimed at curbing the use of civil litigation to chill citizen participation in government, also known as “Strategic Lawsuit[s] Against Public Participation” or “SLAPP[s].” This legislation may impact an employer’s ability to take legal action against certain current and former employee actions which may be considered exercises of free speech or governmental involvement. The Illinois Citizen Participation Act, 735 ILCS 110/1 et seq. broadly protects an individual’s right to petition or participate in government. Section 15 of the Act makes it applicable to any claim in a judicial proceeding that is “based on, relates to, or is in response to any act or acts of the moving party in furtherance of the moving party’s rights of petition, speech, association or to otherwise participate in government.” Section 15 acts are “immune from liability, regardless of intent or purpose,” except where the speech or activities were “not genuinely aimed at procuring favorable government action, result or outcome.” The Act also requires that a court dismiss a SLAPP claim – regardless of the legal theory on which the claim is based – unless the court finds that “the responding party has produced clear and convincing evidence that the acts of the moving party are not immunized from, or are not in furtherance of acts immunized from liability by this Act.” In addition to providing absolute immunity for acts and speech of government participation, the Act requires an expedited hearing once a motion is made to the court. The hearing and decision on a motion in which the Act is raised “must occur within ninety (90) days after the notice of the motion is given to the respondent.” Discovery must be suspended pending the court’s ruling on the motion and can only occur with “leave of court for good reason shown, on the issue of whether the movants acts are not immunized from, or not in furtherance of acts immunized from, liability by this Act.” Finally, the Act contains an attorney’s fee provision and requires that a court “shall award a moving party who prevails under the Act reasonable attorneys fees and costs incurred in connection” with bringing such a motion. Accordingly, Illinois employers must be careful of the claims they raise against employees or individuals who might intend their actions or speech to constitute public or government participation.
735 ILCS 110/1 et seq.
Contact for more information: Steven M. Puiszis
This newsletter has been prepared by Hinshaw & Culbertson LLP to provide information on recent legal developments of interest to our readers. It is not intended to provide legal advice for a specific situation or to create an attorney-client relationship.
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