Norfolk Southern Corp. is a federal contractor that has reached an agreement with the U.S. Department of Labor to pay almost $500,000 to 2,086 African-American job applicants in order to resolve claims of race-based hiring discrimination.

The U.S. Department of Labor’s Office of Federal Contract Compliance Programs (OFCCP) conducted a routine compliance evaluation, and found over a two-year period a division of Norfolk Southern engaged in hiring practices which discriminated against African-American applicants.  These actions were in direct violation of Executive Order 11246 which prohibits federal contactors from discriminating in employment practices.

Norfolk Southern has not admitted liability.  But the Company has agreed to discontinue use of its current selection procedures, as well as to review and modify its employment practices for recruiting, screening, selecting, interviewing, rejecting and hiring candidates.  These changes resolve all the violations found by the OFCCP.

I recently blogged about the importance of not discriminating against job applicants.  This case shows how expensive it can be for employers who fail to review their hiring processes for potential discrimination.    Before making your next hires, review your policies and procedures to make sure you are not discriminating against job applicants.  

US-CourtOfAppeals-8thCircuit-SealThe ADA makes it unlawful for a covered employer to discriminate against any qualified individual on the basis of a disability.  In E.E.O.C. v. Product Fabricator, Inc., 763 F.3d 963 (8th Cir. 2014) the Equal Employment Opportunity Commission brought an action on behalf of a terminated employee indicating there was reasonable cause to believe the employee was terminated as a result of a shoulder injury and on-going shoulder problems.  Product Fabricator, Inc. (PFI) was made aware of the employee’s shoulder injury in September 2008.  From that time until his termination on September 1, 2009, PFI transferred the employee to a less physically demanding position, accommodated his work restrictions, and all medical appointments.  The employee did not schedule surgery on his injured shoulder until after his termination from employment.  The court determined the year long lapse between the employee’s shoulder injury and his subsequent termination was too long and did not support the inference of discrimination.

In Withers v. Johnson, 763 F.3d 998 (8th Cir. 2014), Mr. Withers sued Judge Johnson contending Judge Johnson discriminated against him because of his back injury, failed to accommodate his disability, and retaliated against him for requesting accommodation.  Mr. Withers worked as an assistant probation officer under Judge Johnson.  He suffered an injury at work, and was placed on medical leave in accordance with the Family Medical Leave Act.  On May 10, Mr. Withers was cleared by his doctor to return to work.  He left several voicemail messages for Judge Johnson, but did not reference his ability to return to work.  He also called the H.R. Department, but failed to mention his ability to return to work.   He did not provide a copy of his release to return to work until May 16, when he sent a copy to the H.R. Department, who then forwarded it on to Judge Johnson’s office.  The personnel policy stated, “…you are required to immediately provide a copy of the release to your supervisor to determine your return to work date.  Employees who fail to return to work as designated are considered to have resigned.”  Judge Johnson issued a letter to Mr. Withers indicating he was considered to have resigned his position with the County.  The court held there was no causal connection between Mr. Wither’s request for medical leave and his subsequent discharge, and barred his ADA claim.

Lastly, in Cody v. Prairie Ethanol, LLC, 763 F.3d 992 (8th Cir. 2014) the court determined Prairie Ethanol offered a legitimate, non-discriminatory reason for terminating Mr. Cody’s employment.  The employer cited performance-related issues resulting from Mr. Cody’s overly aggressive way of operating the plant.  While Mr. Cody established a prima facie case of disability discrimination, Prairie Ethanol offered a legitimate, non-discriminatory reason for terminating Mr. Cody, thus shifting the burden back to Mr. Cody to present evidence that Prairie Ethanol’s reasons were pretextual.  The court determined Mr. Cody failed to raise a genuine dispute whether Prairie Ethanol discharged him due to his disability rather than performance issues.

Discrimination cases are very fact specific.  Employers should be strategic and intentional, and avoid knee jerk reactions to avoid missteps.

Tiffany pregnant with Josee - 2
Attorney Tiffany Schmidt pregnant with her third daughter Josee.

According to the Department of Labor, “Women now make up nearly half of the U.S. labor force. Three out of four women entering the workforce will experience at least one pregnancy while employed. Every year, thousands of women file charges of pregnancy discrimination… At the federal level, women are protected by laws like Title VII of the Civil Rights Act, the Pregnancy Discrimination Act, the Americans with Disabilities Act, and the Family Medical Leave Act.”  In addition individual states have enacted laws that provide women with additional protections against pregnancy discrimination.

More often than not our federal government is known for bogged down bureaucracy and a lack of efficiency.  However, today I have to commend the Department of Labor for a great resource for employers who are asking what laws apply to pregnant employees, and what are employers required to provide.  The DOL published a concise pregnancy resource covering both federal and state laws, that I consider to be a little like one-stop shopping.

A map of the country outlines the federal laws which apply to all 50 states.  Clicking on each state leads you to the laws applicable to that specific state.  Here is Minnesota’s link. 

What a refreshing resource, and from the federal government no less!  


 

In June, the American Medical Association (AMA) voted to reclassify obesity as a disease, citing the change as a benefit to the treatment of diabetes and heart disease, and likely to improve insurance coverage. Most employers haven’t yet picked up on the fact the AMA reclassification may have an impact on their business, and open them up to disability and/or discrimination claims by an overweight employee.

Diane Stafford of the Kansas City Star warns employers, “Ignore an obese employee’s request for a larger desk chair and prepare to be sued for violating disability accommodation law. Don’t hire an overweight woman because she doesn’t fit your corporate sales image, and face a possible discrimination lawsuit.”

To understand how this can happen, we need to look back at several Equal Employment Opportunity Commission (EEOC) cases settled last year. EEOC filed charges against BAE Systems of Texas, based on the termination of an obese employee the employer regarded as disabled when they fired him, even though he was able to perform the required job duties. The parties reached a settlement whereby the company would pay the employee $55,000.00, cover the employee’s career outplacement services, train supervisors about disability discrimination, and post anti-discrimination notices in the workplace. In another EEOC case, a treatment facility in New Orleans agreed to pay $125,000.00 to the family of a terminated obese female employee, who similarly was able to perform the essential functions of the job. She passed away prior to the parties reaching settlement of the case.

The EEOC has taken note of obesity in the workplace, and the wave seems to be mounting to include obesity as a disability with the full protection of the Americans with Disabilities Act. (ADAAA) While the recent AMA reclassification of obesity does not have the force of law, it perhaps is a sign of changes to come. The next thing to watch for is a new definition of obesity from the Department of Health and Human Services, and the EEOC.

In the meantime, employers should review their job descriptions to determine if they truly represent the essential functions of a position, and train supervisors about obesity. A supervisor, who regards an employee as disabled when they in fact are not, gives new meaning to the phrase, “Perception becomes reality.” You just want to make sure the perception is based on an accurate job description, and perhaps even appropriate occupational testing to confirm an employee’s ability to perform essential functions. Otherwise regarding someone as disabled when they are not, can be costly to an employer.

Last week, I had lunch with my good friend attorney/litigator Susan Minsberg. Over salmon salad with blackberries, our discussion drifted to the Paula Deen media storm. I told her I had only been marginally following the story, and listed the corporate sponsors who had already jumped ship and dropped her brand, due to the allegations of racism brought by former employee, Lisa Jackson.

Susan wanted to know what I thought about the claims of sexual harassment and sex discrimination, which lead me to wonder if we were talking about the same case. We also discussed whether Jackson’s racism claim might lack standing, as Jackson is Caucasian. Susan sent me a copy of the Complaint which outlines a variety of claims seemingly ignored in the recent media storm. The press has narrowly focused on Deen’s responses in a deposition where she admitted to having used the “n” word, and seemingly ignored the bulk of the rest of the allegations of workplace abuse.

The Complaint actually tells a pretty sordid workplace story, including allegations of sexual discrimination evidenced by a significant wage disparity between female and male employees. The majority of allegations revolve around Deen’s brother, Bubba Hier, who is employed by Deen’s Family of Corporations. The allegations against Bubba include threatening, inappropriate, and offensive conduct in the workplace ranging from racial slurs, pornography at work, and inappropriate sexual comments.

Ms. Jackson alleges she repeatedly reported Mr. Hier’s offensive conduct to a variety of upper level management including the COO, Paula Deen herself, and Ms. Deen’s corporate counsel, without any change or improvement. Ms. Jackson requested personnel policies be implemented to address conduct in the workplace. As a result of her complaints, she was selected to assist management in drafting and implementing a new employee handbook. Then shortly after learning the handbook would not be adopted, Ms. Jackson left employment in the spring of 2010. She filed suit in 2011. The media  recently caught wind of the story, and drilled down specifically on the racism piece of the case. There are a couple of pointers here for management:

  1. Just because someone is family, it does not mean they are a good employee. If the allegations about Bubba Hier’s conduct are true, he ranks up there with the world’s worst employee. His conduct has cost his sister, Paula Deen, a lot of money and embarrassment.
  2. If an employee raises a complaint about conduct in the workplace, employers have an obligation to look into it——immediately! Don’t wait. A workplace complaint places the employer on notice something may be wrong.
  3. Employee handbooks are a good thing.

The Equal Employment Opportunity Commission (EEOC) recently unveiled a new on-line statistical resource for private employers. It provides private sector workplace discrimination charge statistics for each of the 50 states, covering fiscal years 2009-2011. Discrimination charges are broken down into ten categories based on the nature of the claim, and includes the percentage of both state and national charges filed with EEOC.

Minnesota accounts for only 1.2% of discrimination charges filed in the United States. There were 1,204 individual EEOC charges filed in 2011, a slight increase from the previous year. (Note: Individuals often file charges claiming multiple types of discrimination).

Looking at the ten categories, retaliation was by far the most frequent charge filed (51.4%). Disability discrimination came in second (39.6%), followed by race discrimination a close third place (39%). These three types of discrimination charges account for the lions-share of EEOC charges filed in Minnesota. Age and sex discrimination are next at 24.2% and 23.2% respectively.

Q: How does this new on-line feature help private sector employers? A: The data assists employers to anticipate EEOC exposure, conduct risk assessments, and provide appropriate training through action instead of reaction.

Our Minnesota state legislature is currently considering adding a new protected class status to the age, race, gender, disability and other protected classes covered under both state and federal laws. The new protected class being considered is the unemployed.

A bill recognizing unemployed status as a protected class was introduced in the Minnesota Senate last month, and a companion bill was introduced in the House. The Senate file had its first reading and was referred to the Judiciary and Public Safety Committee. The House file was read and forwarded on to the Commerce and Regulatory Reform Committee. Both bills are similar, but not identical. The Senate version carries a civil penalty of not more than $5,000.00 for a first offense and not more than $10,000 for a second offense. The House version currently carries no civil penalty.

Minnesota is not alone and joins over 18 other states who are similarly considering unemployed status as a protected class. According to James Hays and Rebecca Hirschklau of the Sheppard Mullin employment blog, the state of New Jersey has already adopted new legislation recognizing the unemployed as a protected status. They also reported new legislation has been proposed on the federal level in both the House and Senate seeking to bar private employers with fifteen or more employees from discriminating against individuals who are unemployed. The proposed federal legislation covers job postings and hiring decisions, unless current employment is a bona fide occupational requirement.

We will be watching both our Minnesota legislature, and Congress, and let you know what happens….Stay tuned

Last week, the United States Supreme Court ruled in favor of an employee who had alleged he was terminated from his job as a technician at a hospital, due to his military service.  Staub v. Proctor Hospital. The employee claimed he had been discriminated against in violation of the Uniformed Services Employment and Re-employment Rights Act (USERRA).

Mr. Staub argued that the anti-military hostility of two supervisors had wrongly influenced the final decision-maker, who made the decision to terminate his employment.  The case is troubling because there was no proof the decision-maker was aware of the supervisors’ hostility towards Mr. Staub’s military service, or even that she shared in the supervisors’ hostility towards military obligations.   The Court stated, “We therefore hold that if a supervisor performs an act motivated by anti-military animus that is intended by the supervisor to cause an adverse employment action, and if the act is a proximate cause of the ultimate employment action, then the employer is liable under USERRA.”   The Court aggregated the supervisors’ military hostility and attributed it to the decision maker and her decision to terminate Mr. Staub.  The Court remanded the case to the Seventh Circuit to determine if a new trial was warranted.

Mr. Staub’s legal argument of the case is known as a "cat’s paw" theory.  The theory stems from a 1600’s fable by Jean de la Fontaine, where a monkey induces a cat through flattery, to extract roasting chestnuts from a fire.  After the cat has removed the chestnuts, burning his paws in the process, the monkey runs off with the chestnuts and leaves the cat with nothing but his burned hands.  Translated to employment law, an employer can be held liable for discrimination when it can be established the final decision-maker was influenced to take an adverse employment action against an employee (such as termination in the Staub case) through the actions of a lower-level employee who has discriminatory motives.

The difficulty in the case, lies in determining what was the motivating factor of the employer in deciding to terminate Mr. Staub’s employment. The lower court noted, the internal investigation conducted by the employer could have been “more robust.”  This means there were skimpy facts on the record to support that the termination was for any other reason, but for the actions taken by the supervisors who had exhibited military hostility.  This affords a small nugget for employers to take away from the case, when assessing termination decisions in the future. 

Employers should:

  • Make sure their workplace investigations are independent and thorough.  This is especially true if an investigation concerns allegations of discrimination against a supervisor.
  • Accurately document work performance issues and conduct annual performance evaluations of both employees and supervisors.
  • Review and update workplace complaint procedures and make sure everyone is aware of them.
  • Document all employee complaints and be sure to include documentation regarding the outcome of the complaint.
  • Train supervisors on USERRA.

 

This week the EEOC filed discrimination charges against Kaplan Higher Education Corporation, alleging the use of credit checks to screen job applicants was discriminatory. Kaplan had rejected job applicants based on their credit history since at least 2008. According to EEOC, the practice had a disparate impact on black job applicants, and was not job-related or justified by business necessity.

This is actually the second recent claim against an employer who used credit checks to reject job applicants. Last month, similar charges were filed in federal court in a class action lawsuit against the University of Miami. There the job applicant had been offered a job, and quit her previous position. She was then informed she would not be hired due to her credit score.

Plaintiff’s attorneys are actively seeking class action clients who may have been rejected for a job, based on their credit score. According to the EEOC, the problem with using credit checks to screen applicants is that they are not recognized as predictors of job performance. Given the present economy many consumers have struggled with debt and their credit scores have suffered. Coupled with potential errors in credit reports, their use in making job decisions should be carefully scrutinized.

Unless an employer is hiring a CFO, or an accountant, credit scores simply do not meet the job-relatedness and business necessity tests necessary to avoid discrimination charges. Employers should rely on more reliable predictors of job performance to make their 2011 hiring decisions.  This may mean different screening and hiring processes based on individual job descriptions.

The EEOC reports, “Workplace discrimination filings with the federal agency nationwide rose to an unprecedented level of 99,922 during fiscal year 2010.” I predict this number will increase in 2011, and we will see more discrimination claims concerning the use of credit reports as well as an expansion to include other automatic job screening exclusions such as the use of criminal arrest records that don’t result in a conviction.
 

It seems like I have been blogging a lot recently about discrimination cases, but new and interesting cases keep coming across my desk. Here is yet another. Earlier this spring, the Minnesota Court of Appeals interpreted a 22-year old amendment to the definition of “marital status” under the Minnesota Human Rights Act (MHRA). The court found for the plaintiff in Taylor v. LSI Corporation of America, (Minn. App. 4/27/2010) (pdf), stating in order to have an actionable claim of marital status discrimination, it is not necessary to show the alleged discrimination was a direct attack on the institution of marriage. In Taylor v. LSI Corporation of America, Ms. Taylor claims she was let go from her job just because her husband, who was in management at LSI, was being forced to resign his employment with the corporation.
 

The court’s decision is based on a 1988 legislative amendment to the MHRA which defined marital status in employment cases to include “protection against discrimination on the basis of the identity, situation, actions, or beliefs of a spouse or former spouse.” Minn. Stat. § 363A.03, subd. 24. The Court wrote, “The crux of appellant’s claim is that LSI terminated her based on the identity and situation of her spouse, a co-employee whose forced resignation was occurring at the same time. This claim falls squarely within the statutory definition of "marital status."”

The case has been remanded back to the District Court for further proceedings.

What should employers take away from this case?

1) Consider each employee’s continued employment on the merits of his/her performance.
2) What is good for the goose is not necessarily, what is good for the gander.
3) Lastly, don’t automatically terminate the employment of one spouse, just because another spouse is being terminated.