Ohio Court Rejects Age Discrimination When Plaintiff Was Not Replaced, Could Not Identify Similarly-Situated Comparator and Employer Had Honest Belief.

Last month, the Lucas County Court of Appeals affirmed an employer’s summary judgment on an age discrimination claim because the plaintiff employee could not show that he had been replaced, was treated less favorably or that his termination was pretextual when the employer had an honest belief supporting the reason for his termination.  Hardy v. The Anderson's, Inc., 2022-Ohio-3357.   The Court agreed that the plaintiff could show that he was minimally qualified for his position based on his prior experience and promotion even though he had a recent negative evaluation.  However, the plaintiff could not show that he had been replaced when existing employees assumed his prior job duties in addition to their existing responsibilities.  He also could not show that he was treated less favorably than a substantially younger employee when that employee was not similarly situated because he only lived a few hours/miles outside his sale district and had fully informed the manager of his living arrangements and had not tried to hide them, unlike the plaintiff who moved thousands of miles from Michigan to the Caribbean to be with his second wife.   Finally, there was no dispute that the plaintiff had not been candid about his living arrangements with his manager and that the manager blamed his relocation for his poor job performance.  Whether he lied or was merely evasive, whether or not it was necessary to spend a certain amount of time in the sales district meeting with customers, and whether or not he was required to have reported this time as vacation instead of collecting his regular salary, the Court had no trouble finding that no one else had engaged in similar behavior and it justified his termination.  The  Court also rejected the argument that the manager’s prior comment referring to him as a dinosaur could constitute direct evidence of or pretext for discrimination.

According to the Court’s opinion, to save his second marriage, the plaintiff had relocated to his wife’s home country in the Caribbean for extended periods of time without telling his new manager. While the plaintiff’s initial performance evaluation in his new management position had been favorable (while he had been living full-time in his sales district), his second evaluation had been negative even before his new manager found out that he had been spending most weeks in the Caribbean.   The plaintiff admitted that he had not submitted certain weekly report or learned a new computer system.  The plaintiff alleged that his new manager once referred to him as a dinosaur.  When his job performance suffered, the manager found out about his relocation, confronted him and immediately terminated him.    Following the termination, the manager assumed his duties for a few months before restructuring the position and hiring a new employee to perform parts of the duties in one region.    

NOTICE: This summary is designed merely to inform and alert you of recent legal developments. It does not constitute legal advice and does not apply to any particular situation because different facts could lead to different results. Information here can change or be amended without notice. Readers should not act upon this information without legal advice. If you have any questions about anything you have read, you should consult with or retain an employment attorney.

Sixth Circuit Mostly Affirms $5M FLSA Verdict

Yesterday, the Sixth Circuit Court of Appeals mostly affirmed an approximately $5M verdict in a FLSA collective action for unpaid overtime and liquidate damages due to 156 employees.  Pierce v. Wyndham Vacation Resorts Inc., No. 18-5258 (6^th Cir. 4-29-19).   After a 14-day bench trial with over 50 witnesses, the trial court determined that three categories of sales employees worked on average 52 hours per week, but were denied overtime pursuant to a practice and policy which was supported by testimony and exhibits from some management employees.  The employer attempted to dispute that it had a consistent policy by pointing to various reasons that employee time sheets were changed (i.e., failing to record time, working from home, leaving work early, etc.), but this evidence was used to reduce the alleged number of work hours and not to reject the existence of the policy and practice.  The divided Court determined that one category of sales employees should not have been included in the same class as the others because they had different functions, started work two hours later, were not required to attend the same events and meetings, and only had one representative testify, who did not support that his experiences and working hours were the same as other employees, etc. Instead, at the least, there should have been a separate sub-class with evidence supporting a verdict.  The case was remanded to recalculate damages.


According to the Court’s opinion, the employer had four locations in Tennessee involving the sale of time-share vacation properties.   It had three types of sales employees: front-line selling time-shares, inhouse selling upgraded timeshares to existing owners and discovery employees handling leases (but not time shares).  All of them were primarily paid on commissions, but were paid minimum wage draws based on hours worked.  In 2009, it began paying overtime.  The lawsuit was filed in 2013 alleging that the employer had a practice and policy of not paying overtime to the sales force by, among other things, directing employees to not record overtime and by modifying their time cards if they did so.

All of the testifying plaintiffs consistently said that Wyndham required them to underreport their time or altered their recorded time.  They all provided an average of the number of hours they worked each week, ranging from 50 to 80 hours per week, and their basis for that number:  the mandatory morning meeting, tours throughout the day, frequent late-night work and special events, and six- or seven day work weeks.  But, through it all, they didn’t worry about keeping an accurate account of their hours because the company told them it would recoup any overtime pay from their commissions.  

The administrative manager at the Nashville location testified that upper management instructed that sales employees could not be paid overtime and that managers should alter employees’ timecards to show no more than 40 hours per week.  The vice president of sales and marketing at the two Smoky Mountain locations acknowledged that Wyndham performed an audit that showed that salespeople worked off the clock.  Several emails from managers also mentioned Wyndham’s no-overtime-pay policy.  The evidence thus showed that Wyndham executed an across-the-board time-shaving policy that failed to compensate the employees for the hours they worked.

The trial court concluded that the employees worked on average 52 hours/week, awarded $2,512,962 in unpaid overtime and an equal amount in liquidated damages.  Attorney fees for the prevailing employees were not mentioned, but will not be insignificant.


The Court rejected the employer’s challenge to the class certification, with one exception.  It agreed that the discovery employees were not similarly situated because they did not sell time-shares like the other employees, were not required to attend all of the same events or work the same hours or work the same days.  In addition, they were not required to report to work until approximately two hours after the other employees and the testimony was unclear about when they could leave. While they may have stayed later, there was no evidence on that point.   “At the least, the court should have created a separate subclass for the discovery employees.”


“To determine whether plaintiffs are similarly situated, we consider (1) ‘the factual and employment settings of the individual[ ] plaintiffs,’ (2) ‘the different defenses to which the plaintiffs may be subject,’ and (3) ‘the degree of fairness and procedural impact of certifying the action as a collective action.’” The trial court had treated them as one class because they were subjected to the same alleged overtime policy.   While the front-line and inhouse sales employees sold the same product (to different types of customers), they also reported to work at approximately the same time for the same meeting, gave tours, attended events, worked the same days, were compensated the same and recorded time in the same payroll system.  As mentioned, the discovery sales employees had different working hours.


The Court rejected the employer’s attempt to argue that there was not a consistent policy of avoiding overtime because of all of the different reasons that employee time cards were modified.  In light of the evidence introduced, that claim was rejected.  Instead, the Court found that these various explanations could be part of the same policy and practice.  In addition, this evidence was used to reduce the number of alleged overtime hours.


The Court also rejected the employer’s attempt to discredit the employee testimony because it was permitted to depose and call any witnesses it wanted and almost 30% of the employees testified (which is a far greater percentage than in prior successful lawsuits).


The Court also rejected the employer’s expert (who was the only testifying expert) because the expert relied heavily on employee time sheets, which the employees testified were meaningless in light of the employer’s direction to not record overtime and the practice of modifying time sheets that reflected overtime.


NOTICE: This summary is designed merely to inform and alert you of recent legal developments. It does not constitute legal advice and does not apply to any particular situation because different facts could lead to different results. Information here can be changed or amended without notice. Readers should not act upon this information without legal advice. If you have any questions about anything you have read, you should consult with or retain an employment attorney.

Sixth Circuit Finds Female Plaintiff Similarly Situated to Male Co-Workers Who Were Not Fired

Last month, the Sixth Circuit reversed an employer’s summary judgment decision on a sex discrimination lawsuit.  In that case, the plaintiff was the only female Mental Health Technician (out of fourteen) in the defendant psychiatric hospital.  Jackson v. VHS Detroit Receiving Hospital, No. 15-1802 (6^th Cir. 2-23-16).   She was terminated after only outstanding performance evaluations following her first violation of a major disciplinary offense even though two male MHTs were not discharged even though they had violated the same rule and/or a similar major disciplinary offense, and had prior disciplinary records and/or were on last chance agreements.  The Court found that the plaintiff was similarly-situated to both male MHTs despite slight differences in the circumstances and consequences in their violations.  It also rejected the employer’s proffered non-discriminatory reasons that her offense could have resulted in more harm to the patient and that she had that morning received training about the rule that she violated.  The Court also rejected that it was relevant that the decisionmaker was female.

According to the Court’s decision, the plaintiff and other MHTs had received training in the morning about the importance of the nurse and the MHT both checking a patient’s identification band before discharging the patient.   That same afternoon, the plaintiff was instructed by a nurse to discharge a particular patient and she did so without checking the patient’s wrist band because she relied on the nurse and had been busy that morning.  The wrong patient was discharged, having just admitted himself the night before because of suicidal thoughts.  Luckily, the patient readmitted himself a few hours later.   The plaintiff was fired for committing a major infraction that jeopardized the safety of patients or staff even though she had only received positive performance evaluations and no record of disciplinary violations.  She filed suit that she was treated more harshly than male MHTs who committed the same or similar offenses.

One of the comparator MHTs had committed several major disciplinary offenses, been given a final warning and placed on a last chance agreement (whereby he could be terminated for even minor offenses).  Nonetheless, he was not discharged after walking out the wrong patient without first checking the patient’s identification band on the direction of a nurse even though the patient required crutches and he did not give those crutches to the patient upon discharging him.   The manager determined that he had been entitled to rely on the direction of the nurse because he had been busy at the time tending to other patients.  The other comparator had been disciplined for discharging a patient on the instructions of a social worker (instead of a nurse) and admitting a patient without first searching him (and confiscating three knives he had been carrying).  Even though these were similarly serious violations, he has only suspended and placed on a final warning.

The Court found these comparators to be similarly situated to the plaintiff despite slight differences in their infractions.  The Court also rejected the employer’s explanation that the plaintiff’s violation was more egregious because the potential consequences of incorrectly discharging a suicidal patient were not necessarily much more severe than discharging the incorrect patient without his necessary crutches or admitting a patient who was carrying lethal weapons.  Speculation about the potential, likelihood and comparative severity of the various infractions should be left to the jury.   The Court also rejected the employer’s argument that the plaintiff’s infraction was more severe because she had just been trained on that standard the same morning because the same standard had been in place when the comparators also violated the rule.   While the jury could reasonably conclude that the plaintiff had been terminated in order to make an example of her, it could also conclude that she should have been treated more leniently in light of her lengthy tenure and spotless performance record in comparison to the male comparators.

The Court also rejected the employer’s argument that different discipline was warranted for the slightly different offense of failing to search a newly admitted patient because the rule was identically severe in its treatment in the employer’s policies.

Several facts in the record can be used to draw the inference that DRH considered Jackson’s and Little’s infractions substantially identical in terms of severity of potential consequences. That their mistakes were cited as violating the same two major infractions indicates that those mistakes were substantially identical in terms of potential disciplinary consequences: DRH’s discipline policy defines major infractions by the potential for immediate termination. Similarly, that Jackson’s and Little’s mistakes were cited as violations of major infraction “k,” which is defined as “[a]ny action or conduct that endangers or may be detrimental to the well being of a patient, co-worker, physician, contractor or visitor” . . . suggests that DRH considered the potential harm resulting from those mistakes to be similar. Indeed, Leorea Heard provided “[t]he patient getting an improper search” as an example of an “incident that might have put the unit in danger.”

The Court was also influenced by the fact that “[i]n a majority female workplace, the fact that Jackson was the only female out of fourteen MHTs supports her contention that DRH preferred males for that particular position.”  Nonetheless, the Court rejected the employer’s argument that this factor was outweighed by the fact that the decisionmaker was also female and the plaintiff had always received positive performance evaluations because the evaluations might have warranted more leniency and the Supreme Court's decision in 

Oncale does not prohibit any consideration of the fact that the decision-maker was the same sex as the plaintiff. See id. But that case makes clear that a mere conclusory assertion to that effect does not, on its own, render unreasonable an inference of discriminatory intent. We find this maxim especially true here, where the primary inference Jackson attempts to draw from the record is that Crisis Center management preferred males for the position of MHT, perhaps “because they thought females could not physically handle unruly patients.” (Pl.’s Br. At 1.) Jackson’s case is thus largely unaffected by the fact that her managers were female.

NOTICE: This summary is designed merely to inform and alert you of recent legal developments. It does not constitute legal advice and does not apply to any particular situation because different facts could lead to different results. Information here can be changed or amended without notice. Readers should not act upon this information without legal advice. If you have any questions about anything you have read, you should consult with or retain an employment attorney.

Supreme Court Creates New Legal Standard For Pregnancy Discrimination Claims

This morning, a divided Supreme Court reversed the employer’s summary judgment in a disparate treatment pregnancy discrimination case, but rejected the legal and statutory interpretation arguments submitted by the government, EEOC, employer and plaintiff.  Instead, the Court created a new standard which applies only to pregnancy discrimination claims.  Young v. UPS, No. 12-1226 (3-25-15).  The issue confronting the Court was how an employer must treat a pregnant employee who requires an accommodation offered to some, but not all, other non-pregnant employees with similar physical restrictions.  The Court rejected most-favored-nations status for pregnant employees based simply on the grounds that accommodations have been offered to only some employees. It also rejected the employer’s argument that pregnant employees only need to be treated the same as other non-pregnant employees.  Instead, the Court slightly relaxed the similarly-situated standard in the prima facie case, rejected certain business justifications, and expanded what could constitute pretext for discrimination. 

According to the Court’s opinion, the employer requires delivery drivers to carry up to 70 pounds.  During her pregnancy, the plaintiff was medically restricted to carrying only 20 pounds.  The employer refused to waive the lifting requirement, to temporarily transfer her to an alternative position or to permit her to work.  She took unpaid leave and ultimately lost her medical coverage.  This lawsuit followed. 

The employer defended its refusal to waive its lifting requirements or to transfer her to a light duty position on the basis that it only accommodated employees with workers’ compensation injuries, who lost their DOT certifications, or who were covered by the ADA (which, should be noted, does not include pregnancy as a disability or require an employer to eliminate an essential job function, but could require a transfer to another, open position).  The plaintiff contended (over the employer’s objection) that it also accommodated other employees with physical limitations.  A union steward testified that the only physical limitations that the employer did not accommodate with a transfer were pregnant employees.   The employer was given summary judgment (on the basis that the plaintiff did not identify similarly situated employees who were treated better), which was affirmed on appeal.  Those courts would only permit the pregnant plaintiff to compare herself to employees injured off the job.

The Court noted that the Pregnancy Discrimination Act has two provisions at issue in the litigation:  the incorporation of pregnancy into the definition of Title VII’s sex discrimination and a duty to treat pregnancy physical limitations “the same . . . .as other persons not so affected but similar in their ability or in­ability to work.” 

The Court rejected the employer’s argument that the second clause in the PDA merely clarifies the meaning of sex discrimination because the clarification would render the first clause superfluous.  Therefore, the Court rejected the employer’s proposed analysis that “courts would compare the accommodations an employer provides to pregnant women with the accommodations it provides to others within a facially neutral category (such as those with off-the-job injuries) to determine whether the em­ployer has violated Title VII.”  That analysis would exist even in the absence of the second clause: “If the second clause of the Act did not exist, we would still say that an employer who disfa­vored pregnant women relative to other workers of similar ability or inability to work had engaged in pregnancy discrimination.”

The  Court also rejected the plaintiff’s argument that an employer must accommodate every pregnant employee’s restrictions if it accommodates any other employee’s restrictions.  The Court found that this granted pregnant employees  “most favored nation” status which would discourage an employer from accommodating the physical restrictions of long-time employees, those employees with special, extraordinarily hazardous and/or necessary skills or elderly employees.  Indeed, seniority is a enumerated defense to a Title VII claim.

The language of the statute does not require that unqualified reading. The second clause, when referring to nonpregnant persons with simi­lar disabilities, uses the open-ended term “other persons.” It does not say that the employer must treat pregnant employees the “same” as “any other persons” (who are similar in their ability or inability to work), nor does it otherwise specify which other persons Congress had in mind.

Moreover, disparate-treatment law normally permits an employer to implement policies that are not intended to harm members of a protected class, even if their imple­mentation sometimes harms those members, as long as the employer has a legitimate, nondiscriminatory, nonpre­textual reason for doing so.

The Court refused to give any significant weight to last year’s EEOC PDA guidance which advised employers to provide the same accommodations to pregnant employees that it provides to employees with work injuries. Both before and immediately after the passage of the PDA, the EEOC guidelines required only that pregnancy be treated the same as other medical conditions:

“Disabilities caused or contributed to by preg­nancy . . . for all job-related purposes, shall be treated the same as disabilities caused or contributed to by other medical conditions.”

  In rejecting the recent EEOC guidance, the Court cited concerns with its

timing, “consistency,” and “thor­oughness” of “consideration.” The EEOC promulgated its 2014 guidelines only recently, after this Court had granted certiorari in this case. In these circumstances, it is fair to say that the EEOC’s current guidelines take a position about which the EEOC’s previous guidelines were silent. And that position is inconsistent with positions for which the Government has long advocated. . . . Nor does the EEOC explain the basis of its latest guidance. Does it read the statute, for example, as embodying a most-favored-nation status?   Why has it now taken a position contrary to the litigation position the Government previously took?   Without further explanation, we cannot rely significantly on the EEOC’s determination.

The Court observed that the PDA was enacted to overrule the Court’s prior decision in General Elec. Co. v. Gil­bert, 429 U. S. 125 where the employer provided sickness and accident insurance to non-pregnant employees and the Court found no sex discrimination because women received the same coverage that men did.  Simply including pregnancy into Title VII would not have changed the result in Gilbert, which was the intent of the second clause in the PDA.

While pregnancy discrimination claims are to be treated similarly to any other sex discrimination claims, they will differ in three material respects.  For instance, the similarly-situated standard must be relaxed:

an individual plaintiff may establish a prima facie case by ‘showing actions taken by the employer from which one can infer, if such actions remain unexplained, that it is more likely than not that such actions were based on a discriminatory criterion illegal under’ Title VII. . . . Nei­ther does it require the plaintiff to show that those whom the employer favored and those whom the employer disfa­vored were similar in all but the protected ways.

In particular, the Court laid out the shifting burdens of proof as follows:

First, the plaintiff must show:

a) that she belongs to the protected class,

b) that she sought accommodation,

c) that the employer did not accommodate her, and that the employer did accommodate others “simi­lar in their ability or inability to work.”

Second, the employer would need to provide a legitimate and nondiscriminatory reason for refusing to provide the requested accommodation.

 

But, consistent with the Act’s basic objective, that reason normally cannot consist simply of a claim that it is more expensive or less convenient to add pregnant women to the category of those (“similar in their ability or inability to work”) whom the employer accom­modates. After all, the employer in Gilbert could in all likelihood have made just such a claim.

Third, the plaintiff must show that the employer’s reason is pretextual.

We believe that the plaintiff may reach a jury on this issue by providing sufficient evidence that the employer’s policies impose a significant burden on preg­nant workers, and that the employer’s “legitimate, nondis­criminatory” reasons are not sufficiently strong to justify the burden, but rather—when considered along with the burden imposed—give rise to an inference of intentional discrimination.

The plaintiff can create a genuine issue of material fact as to whether a significant burden exists by providing evidence that the employer accommodates a large per­centage of nonpregnant workers while failing to accommo­date a large percentage of pregnant workers. Here, for example, if the facts are as Young says they are, she can show that UPS accommodates most nonpregnant employ­ees with lifting limitations while categorically failing to accommodate pregnant employees with lifting limitations. Young might also add that the fact that UPS has multiple policies that accommodate nonpregnant employees with lifting restrictions suggests that its reasons for failing to accommodate pregnant employees with lifting restrictions are not sufficiently strong—to the point that a jury could find that its reasons for failing to accommodate preg­nant employees give rise to an inference of intentional discrimination.

In response to the dissent’s concern that the  Court was imposing liability under a disparate impact theory, it notes that it intends for “continued focus on whether the plaintiff has introduced sufficient evidence to give rise to an inference of intentional discrimination.”

Ultimately, the Court reversed the employer’s summary judgment, but left open the possibility that the employer’s explanation could ultimately prevail on summary judgment because it was expressing no opinion as to whether the plaintiff had introduced sufficient evidence to show pretext.

NOTICE: This summary is designed merely to inform and alert you of recent legal developments. It does not constitute legal advice and does not apply to any particular situation because different facts could lead to different results. Information here can be changed or amended without notice. Readers should not act upon this information without legal advice. If you have any questions about anything you have read, you should consult with or retain an employment attorney.

 

 

Unanimous Supreme Court Punts Question of Admissibility of “Me-Too” Evidence to Trial Courts.

Yesterday, an unusually unanimous Supreme Court finally ruled in a case involving whether “me-too” evidence (i.e., testimony by a plaintiff’s co-workers that they also felt discriminated against) is admissible in an employment discrimination lawsuit. However, rather than establish clear rules about the relevance of this problematic evidence, the Court punted the entire question back to trial courts to rule how they see fit in their own discretion. Sprint/United Management Co. v. Mendelsohn, No. 06-1221 (2/26/08).

The particular case involved an age discrimination plaintiff who lost her job in a company-wide reduction in force. The plaintiff sought to buttress her case by introducing “me-too” testimony by other former employees who had lost their jobs in the same RIF that they too believed they had lost their jobs because of age discrimination even though they had different supervisors and decisionmakers. The plaintiff’s hope is that the jury will be more likely to attribute a decision to age discrimination if more employees make the same argument. However, in a mere two sentences, the trial court excluded the “me-too” evidence – presumably on the grounds (asserted by the defendant employer) that it was unfairly prejudicial to the employer and the witnesses were not sufficiently similarly- situated to the plaintiff to make their testimony particularly relevant or material. In other words, whether or not these employees were discriminated against by their supervisors was not relevant to whether the plaintiff’s supervisor discriminated against her in selecting her for the RIF. The court of appeals reversed on the grounds that it assumed that the trial court had made a per se rule that such “me-too” evidence is always inadmissible. While the appellate court agreed about the propriety of such a per se exclusionary rule in the run-of-the-mill discriminatory treatment case (i.e., discipline, termination for cause, etc.), the appellate court believed that in a company-wide RIF, the excluded testimony would be relevant to show that age discrimination pervaded the company to such an extent that it was more likely than not that many supervisors (not just the plaintiff’s supervisor) were influenced to use age as a factor in laying off employees. Following such an argument, such pervasive discrimination could have influenced the plaintiff’s supervisor to select her for the RIF on account of her age.

The Supreme Court reversed on the grounds that the appellate court should not have second-guessed the trial court’s discretion in making evidentiary rulings by assuming the basis for the trial court’s decision. Rather, the appellate court should have remanded the matter back to the trial court for further explanation before concluding that it had abused its discretion in excluding the evidence. The Court established no guidance for the trial court (or attorneys) as to the potential relevance of “me-too” testimony. Writing for an unusually unanimous Supreme Court, Justice Thomas concluded:

“We conclude that such evidence is neither per se admissible nor per se inadmissible. . . . . . We note that, had the District Court applied a per se rule excluding the evidence, the Court of Appeals would have been correct to conclude that it had abused its discretion. Relevance and prejudice under Rules 401 [making relevant evidence admissible] and 403 [excluding evidence that is unfairly prejudicial] are determined in the context of the facts and arguments in a particular case, and thus are generally not amenable to broad per se rules. . .. . The question whether evidence of discrimination by other supervisors is relevant in an individual ADEA case is fact based and depends on many factors, including how closely related the evidence is to the plai ntiff's circumstances and theory of the case. Applying Rule 403 to determine if evidence is prejudicial also requires a fact-intensive, context-specific inquiry.” (emphasis added).

With this in mind, employers should always remember that it is possible that disgruntled former employees may return to haunt them in a lawsuit brought by a former co-worker and that plaintiffs’ attorneys are more likely to seek discovery about these disgruntled co-workers in order to introduce possible “me-too” testimony. While courts may exclude such testimony on the grounds that it would unfairly influence the jury and shed little light on the ultimate question in the case (i.e., the legality of the plaintiff’s treatment), the trial court alternatively could find it relevant to the plaintiff’s theory of the case.

Insomniacs can read the full decision at http://www.supremecourtus.gov/opinions/07pdf/06-1221.pdf.

NOTICE: This summary is designed merely to inform and alert you of recent legal developments. It does not constitute legal advice and does not apply to any particular situation because different facts could lead to different results. Information here can change or be amended without notice. Readers should not act upon this information without legal advice. If you have any questions about anything you have read, you should consult with or retain an employment attorney.