Second Circuit
Duplan v. City of New York, ___ F.3d ___, 2018 WL 1996613 (2d Cir. Apr. 30, 2018).
Government employees cannot sue their employers under 42 U.S.C. § 1981 and may only do so under 42 U.S.C. § 1983. The U.S. Supreme Court reached this holding in Jett v. Dallas Indep. Sch. Dist., 491 U.S. 701 (1989), and while the Ninth Circuit has since held that the Civil Rights Act of 1991 allows government employees to proceed under Section 1981, the other federal circuits continue to apply Jett, and the Second Circuit joins those circuits in reaffirming the continued viability of Jett’s holding.
In addition, the Court of Appeals provides gloss under the “reasonably related” doctrine that holds that retaliation claims that were not formally brought to the EEOC but which would have been reasonably related to the EEOC charge may form the basis for a subsequent federal lawsuit. However, in this case, the first EEOC charge did not lead to a federal lawsuit. Although plaintiff suffered retaliation following the first EEOC charge, that retaliation cannot predicate a subsequent federal action arising from a second EEOC charge. The Court states:
No administrative or judicial proceeding is still pending, and the employee who suffers further discrimination or retaliation, like any other employee with a potential Title VII claims, therefore remains subject to that statute’s administrative exhaustion requirement. There is no reason to expand the judicially created waiver of the statutory exhaustion requirement to permit unexhausted retaliation claims to be held open indefinitely into the future, or litigated without going through a new administrative process, simply because, if the plaintiff had timely filed suit, policy considerations would have weighed in favor of waiving the exhaustion requirement so that the retaliation claim could have been joined with that hypothetical lawsuit.
Although we have not previously had occasion to make clear that “reasonably related” retaliation claims are excused from the exhaustion requirement only if they arise during the pendency of an EEOC investigation or a timely filed federal case, that outcome is consistent with Title VII’s statutory scheme and our existing case law.
As for the retaliation claims that plaintiff was able to properly plead in his Title VII action, he alleges plausible claims. The Court of Appeals reasons that “a series of adverse actions occurred against a backdrop of continuing antagonism and frustration of his professional ambitions. Following his 2011 complaints, his supervisors collectively and persistently discouraged him from remaining at the Department by ostracizing him, giving him insufficient work, and making clear to him that his career would not advance further by denying him every promotion and raise. Those allegations establish a drumbeat of retaliatory animus from which a plausible inference of causation can be drawn”.
Neary v. Gruenberg, ___ Fed. Appx. ___, No. 17-2470-cv, 2018 WL 1612234 (2d Cir. Apr. 4, 2018) as amended (Apr. 5, 2018).
Neary was a 41 year old applicant for a position at the FDIC. He claims he was denied the position because of his age, in part, because 53 of the FDIC’s 54 new hires were under the age of 40, as per a directive to focus on hiring recent college graduates. Apart from the fact that the directive was not yet in effect when Neary was denied the position, his constitutional claim fails for another reason: the government had a rational basis to focus on younger hires. As the Supreme Court has never held that age is a suspect class, the government can avoid liability upon a showing that its age-related decision making has a rational basis. The government’s proffered justification for the program is “to replenish a workforce containing an ever growing number of Federal employees near[ing] retirement age with students and recent graduates.” Neary may be correct that the government could have adopted a different selection process to identify qualified applicants who would likely become long‐serving federal employees, and it may be true that the selection criteria the program used failed to account for the work preferences of Millennials, but that is not the relevant inquiry. “[W]here rationality is the test,” the government does not violate equal protection “merely because the classifications made by its laws are imperfect.”
Submitted by:
Stephen Bergstein, Esq.
Bergstein & Ullrich, LLP
5 Paradies Lane
New Paltz, New York 12561
(845) 419-2250
www.TBULaw.com
www.secondcircuitcivilrights.blogspot.com
Fourth Circuit
Bakery & Confectionary Union & Indus. Int’l Pension Fund v. Just Born II, Inc., ___ F.3d ___, 2018 WL 1956009 (4th Cir. Apr. 26, 2018).
Pursuant to a collective bargaining agreement with a local union, an employer was required to contribute to a pension fund governed by ERISA. While the collective bargaining agreement was in effect, actuaries certified the fund to be in critical status, as defined by 29 U.S.C. § 1085, and the plan sponsor developed a rehabilitation plan. The employer contributed to the pension fund pursuant to the rehabilitation plan for a period of time.
During the renegotiation of the collective bargaining agreement, the employer sought to remove the requirement that it contribute to the fund for newly hired employees. The union would not agree, and the employer declared a good-faith impasse. The employer then unilaterally imposed its last offer to the union and continued payment under the revised schedule for existing employees only.
The pension fund sued the employer seeking to compel payment under the rehabilitation schedule for all employees pursuant to 29 U.S.C. § 1085(e)(3)(C)(ii) (the “Provision”). The district court entered judgment on the pleadings for the pension fund and ordered the employer to pay the delinquent contributions. The Fourth Circuit affirmed.
The Provision is part of the Pension Protection Act of 2006, which was designed to help underfunded multiemployer pension plans recover. The Provision states that if a collective bargaining agreement expires while a rehabilitation plan is in critical status, and the bargaining parties to the collective bargaining agreement fail to adopt a contribution schedule consistent with the rehabilitation plan, then the contribution schedule under the expired collective bargaining agreement shall be implemented.
The employer argued on appeal that it was not a “bargaining party” under the Provision with respect to the new employees since the collective bargaining agreement had expired and a new agreement had not been reached.
The Fourth Circuit concluded that the employer was a “bargaining party” required to contribute to the pension fund under the rehabilitation schedule for all employees. The Court explained that the Provision only applies after a collective bargaining agreement expires, such that the expiration of the collective bargaining agreement in this case could not alter the employer’s status as a bargaining party. The Court further explained that the employer conceded that it was a bargaining party to the collective bargaining agreement prior to its expiration. The Court found that the remaining criteria under the Provision also were met: The collective bargaining agreement expired while the fund was in critical status, and the bargaining parties failed to adopt a contribution schedule. The Court concluded, therefore, that the employer was required to make contributions according to the schedule in effect at the time the collective bargaining agreement expired.
The Court noted that its holding did not limit the employer’s ability to withdraw from the ERISA-qualified plan, as permitted under other ERISA provisions. However, where, as here, the employer had not exercised its right to withdraw, the Provision applied and required contributions under the schedule in effect at the time the collective bargaining agreement expired. The Court concluded that to hold otherwise would permit the employer to make an end run around the critical-status contributions required by the Provision and the withdrawal penalty under 29 U.S.C. § 1381.
The Fourth Circuit also agreed with the district court that the employer’s affirmative defenses were subject to the particularity requirement of Federal Rule of Civil Procedure 9(b), and that the employer’s defenses failed to meet that requirement. The gravamen of the defenses was fraudulent or intentional misrepresentation that the pension fund was in “critical status.” The Court looked beyond each defense’s label and determined that each defense sounded in fraud. Therefore, the employer’s defenses pleaded as fraudulent or intentional inducement, fraudulent or intentional material misrepresentations, unjust enrichment, unclean hands, and legally defective placement into critical status had to be pleaded with particularity.
Submitted by:
Paul Sun
Emily Erixson
ELLIS & WINTERS LLP
Paul.sun@elliswinters.com
Post Office Box 33550
Raleigh, North Carolina 27636
Telephone: 919.865-7000
www.elliswinters.com
Fifth Circuit
Herster v. Board of Supervisors of LSU, 887 F.3d 177 (5th Cir. 2018).
Plaintiffs Margaret Herster (“Herster”) and Scott Sullivan (“Sullivan”) were employed by Louisiana State University (“LSU”). Herster, a part time instructor of digital art and later a full time professional in residence, brought the principal claims for Title VII gender discrimination in her pay and retaliation under the Louisiana whistleblower statute. Her husband, a law professor, brought a claim for loss of consortium. The Fifth Circuit considered three issues on appeal: (1) whether the district court properly granted LSU’s motion for judgment as a matter of law for Herster’s Title VII gender discrimination in pay claim; (2) whether the district court properly granted LSU’s motion for judgment as a matter of law for Herster’s Louisiana whistleblower statute claim; and (3) whether the district court properly granted LSU’s motion for summary judgment for Herster’s Louisiana state law spoliation. This brief addresses the first two issues on appeal.
The Court affirmed the trial court holding that Herster could not prevail on her Title VII gender discrimination in pay claim, because she did not show that she was paid less than a proffered comparator, not in her protected class, for work requiring substantially the same responsibility. Herster proffered three comparitors whose job responsibilities and qualifications differed from hers. Two of her comparitors were assistant professors requiring research as a condition of employment, while Herster’s position did not require research. The other comparator had greater educational qualifications and a larger course load than Herster. To determine whether a comparator is similarly situated, the Court considered factors including job responsibility, experience, and qualifications and found that LSU negated one of the crucial elements in Herster’s prima facie case” of discrimination by showing a significant difference in job responsibilities.
The Court then addressed whether Herster provided direct evidence of discrimination. Herster proffered evidence that the male Director of the School of Art called Herster a “trailing spouse”, “a princess”, and stated that he thought she was “going to have children and be happy”. The Court ruled that the trailing spouse term does not refer to gender and Parker’s comments, at most, implied that gender was a factor in the decision concerning Herster’s compensation. The Court also held that Parker’s comments were stray remarks that failed to provide direct evidence of discrimination for Herster’s gender discrimination in pay claim.
The Court then addressed Herster’s Louisiana whistleblower statute claim, restating the elements of a violation: (1) LSU must have violated Louisiana law through a prohibited workplace practice; (2) Herster must have advised LSU of the violation; (3) Herster threatened to disclose or disclosed the prohibited practice; and (4) Herster was terminated as a result of her threat to disclose or because of the disclosure of the prohibited practice. Herster believed that the School of Art was imposing illegal course fees on students and advised LSU of her belief of the violation. An internal audit ensued and determined that the course fees were not approved by the legislature. The Court, however, determined that the term “fee” was not defined in the Louisiana Constitution and that Herster failed to show that LSU actually violated the Louisiana Constitution and that there was no actual violation of Louisiana law. Because the first element was not met – there was no showing of a violation, the whistleblower statute claim also failed.
Submitted by:
Susan Cone Kilgore
Lesser Law Firm
9800 Lorene Lee
San Antonio, Texas 78216
Phone: 210-904-8477
Fax: 210-504-4486
susan@leeserlaw.com
Sixth Circuit
EEOC v. R.G. &. G.R. Harris Funeral Homes, Inc., 884 F.3d 560 (6th Cir. 2018).
Aimee Stephens was terminated from her employment two weeks after she notified her employer that she was undergoing a gender transition from male to female and intended to begin dressing as a female. Her employer terminated Ms. Stephens because it disagreed with her decision to transition. The EEOC filed a lawsuit on Ms. Stephens’ behalf, contending that her termination violated Title VII of the Civil Rights Act of 1964. Judge Sean F. Cox from the U.S. District Court for the Eastern District of Michigan ruled that transgender status is not a protected class under Title VII, but because the EEOC complaint also stated that Ms. Stephens was fired because she did not conform to sex- or gender-based preferences, expectations or stereotypes, Sixth Circuit precedent establishes that the EEOC properly stated a claim for relief under Title VII.
On appeal, the three-judge panel reversed Judge Cox’s ruling that transgender status is not a protected class under Title VII, finding that discrimination on the basis of transgender and transitioning status is discrimination on the basis of sex. The appeals court also found that the Funeral Home did not qualify for the ministerial exception to Title VII because its religious exercise would not be substantially burdened by continuing to employ Ms. Stephens without discriminating against her on the basis of sex stereotypes, the EEOC established that it has a compelling interest in ensuring the Funeral Home complies with Title VII and the enforcement of Title VII is the least restrictive way to achieve that compelling interest.
Submitted by:
Jacob M. Hogg
Miller, Canfield, Paddock & Stone, P.L.C.
150 W. Jefferson, Suite 2500
Detroit, MI 48226
hogg@millercanfield.com
Seventh Circuit
Sampra v. United States Dep’t of Transp., 888 F.3d 330 (7th Cir. 2018).
The plaintiff sued her employer for interference with Family and Medical Leave Act rights by reassigning her to a different position after she returned from childbirth leave. The district court had granted summary judgment to the employer on the merits. However, the Court of Appeals ruled that the plaintiff failed to file her complaint within the applicable two year statute of limitations under the FMLA, and she had not shown evidence that the Department willfully violated her FMLA rights in order to extend the statute of limitations to three years. In so holding, the Seventh Circuit agreed with other circuits in holding that the willfulness standard for Fair Labor Standards Act claims, expressed in McLaughlin v. Richland Shoes Co., 486 U.S. 128 (1988) applies to the FMLA as well. Under that standard, the plaintiff had failed to show that the supervisor either knew his conduct would violate the FMLA or showed reckless disregard.
Kleber v. CareFusion Corp., ___ F.3d ___, 2018 WL 1959662 (7th Cir. Apr. 26, 2018).
The defendant had posted a job opening for a lawyer with “3 to 7 years (no more than 7 years) of relevant legal experience.” The plaintiff, a 58 year old with extensive experience, applied for the position, but was not selected for an interview. The position was filled with a 29-year old applicant. The plaintiff filed a charge with the EEOC and then sued the prospective employer. The district court dismissed the claim on a Rule 12(b)(6) motion.
Reversing the dismissal, the Seventh Circuit held that the disparate impact provision of the Age Discrimination in Employment Act of 1967 protects both current employees and outside job applicants. The court reasoned that though the applicable section of the ADEA does not explicitly say it protects outside job applicants, protection of both categories of individuals was a better reading of the statutory text and more consistent with the purpose of the ADEA and case law interpreting it since its enactment.
Submitted by:
Cate Lindemann
Littler Mendelson P.C.
321 North Clark Street, Suite 1000
Chicago, IL 60654
(312) 795-3283
CLindemann@littler.com
Ninth Circuit
Rizo v. Yovino, 887 F.3d 453 (9th Cir. 2018) (en banc).
Plaintiff, a math consultant with the Fresno County Office of Education, brought an Equal Pay Act claim against the County after learning that her starting salary was lower than that of male math consultants. The County set her initial salary in accordance with its standard procedure of adding five percent to an individual’s prior salary. As a result, plaintiff’s salary with Fresno County was based entirely on her prior salary as a secondary school teacher in Maricopa County, Arizona.
The County argued that its use of prior salary alone fell within the Equal Pay Act’s catchall exception, which permits wage differentials for equal work based on “any other factor other than sex.” 29 U.S.C. § 206(d)(1). A three-judge panel of the Ninth Circuit initially determined that the case was controlled by Kouba v. Allstate Ins. Co., 691 F.2d 873 (9th Cir. 1982), which allowed consideration of prior salary as a “factor other than sex,” and held that use of prior salary alone was permissible as long as use of that factor “was reasonable and effectuated some business policy.”
In an opinion authored by Judge Reinhardt published after his death, an en banc panel of the Ninth Circuit overruled Kouba and held that “any other factor other than sex” is limited to legitimate, job-related factors such as a prospective employee’s experience, educational background, ability, or prior job performance. Because prior salary is not job-related, whether considered alone or with other factors, it cannot be used to account for disparate pay for equal work. In so concluding, the Court relied on the broad remedial intent and purpose of the Equal Pay Act, reasoning that Congress could not possibly have meant for legislation intended to eliminate long-standing sex-based wage disparities to include an exception for prior salaries, which would commonly reflect those disparities. The Court also construed the text of the catchall exception—“any other factor other than sex”—as consistent with the job-related qualities of the statute’s three other permissible bases for wage differentials: seniority, merit, and productivity. The Ninth Circuit expressly declined to follow the approach adopted by some other circuits, which allow for consideration of prior salary when combined with other, job-related factors while prohibiting wage differentials on the basis of prior salary alone. The Court noted, however, that it was announcing a “general rule,” and did not endeavor to resolve that rule’s application under all circumstances, such as whether and under what circumstances prior salary permissibly may play a role in individualized salary negotiations.
Four concurring judges expressed their view that the majority opinion went too far in holding that any consideration of prior salary is “impermissible” under the Equal Pay Act. Those judges would have found, consistent with some other circuits, that prior salary, when combined with other valid job-related factors such as education or training, can provide a lawful benchmark for starting salary in appropriate cases
Submitted by:
Andrew Narus
Barran Liebman LLP
601 SW 2nd Avenue, Suite 2300
Portland, OR 97204
(503) 276-2104
anarus@barran.com
D.C. Circuit
Oncor Elec. Delivery Co. v. NLRB, 887 F.3d 488 (D.C. Cir. 2018).
In Oncor Electric Delivery Co. v. National Labor Relations Board, the D.C. Circuit reviewed the circumstances under which an employee’s criticism of the employer qualifies as protected, concerted activity under the National Labor Relations Act (“NLRA”), and remanded the case to the National Labor Relations Board (“NLRB”) for additional findings.
In the case, a union representative had threatened his employer that if collective bargaining negotiations were not favorably resolved, he would testify the next day before the Texas senate regarding “smart” electrical meters installed by the employer. The employee ultimately did testify and criticized the meters, claiming that they caused fires in customers’ homes. After an investigation, the employer concluded that the employee’s testimony had been false and terminated his employment.
Under the NLRA, employees are protected when they engage in concerted activities for the purpose of collective bargaining or other mutual aid or protection, and under some circumstances those activities can include appeals to third parties outside of the employment relationship. This protection, however, is balanced against the right of employers to dismiss employees for cause, including disloyalty. Disparaging statements enjoy the NLRA’s protection only where (1) the communication indicates it is related to an ongoing labor dispute, and (2) the communication is not so disloyal, reckless, or maliciously untrue as to lose protection.
The D.C. Circuit remanded the case to the NLRB because it was not clear from the record what facts the NLRB had relied upon to find the first prong of the test – connection to a labor dispute – satisfied. The rationale for this test is that if a third party listener knows the statement is a partisan one designed to advance a labor cause, the listener can use that context to give appropriate weight to the statement. The court noted that while the employee had indicated that his testimony was on behalf of a union, there was no public disclosure of the ongoing collective bargaining negotiation. In addition, the content of the employee’s testimony itself did not bear a clear nexus to the subject of the labor dispute as smart meters were not at issue in the collective bargaining negotiations.
Submitted by:
Jack Blum
Paley Rothman
4800 Hampden Lane 6th Floor
Bethesda, MD 20814
301-968-3415
jblum@paleyrothman.com