Why Consistent and Accurate Explanations for Firing are Crucial

A decision out of New York last week illustrates why employers should provide consistent and accurate explanations for their decisions.

Cornell University taught industrial and labor relations to working practitioners at various locations around New York State. One of the instructors was Margaret Leibowitz, who was hired on a contract basis. When the University refused to renew her contract, she sued for age and sex discrimination (and several other claims which I will ignore).

Ms. Leibowitz's job required her to travel from New York City to Ithaca regularly and the funds the University paid her for travel were a regular source of friction. The Dean described Leibowitz requests as "forceful," "demanding," and "pushy." (There was also some hint that male employees also regularly asked for increases in their travel expenses without having problems or being fired.) The Dean also asserted that Leibowitz had "burned bridges" and had "bad blood" with other University personnel, though there was some question about whether these personality conflicts were too old and whether similar conflicts with male employees had been overlooked.

So when it came down to whether to renew Leibowitz contract, the University decided it could not afford her. Ms. Leibowitz was not fired immediately but was told she would not be back after the end of the following school year.

Perhaps the University could have built a case for refusing to renew her contract because of the friction she seemed to generate, but instead, the University defended the non-renewal by saying that their budget couldn't afford her and her travel expense demans. Having made that decision, the University then refused to permit her to move into another position, going so far, the court said, as to fire a Director who made a "not valid" offer of employment to Ms. Leibowitz.

Several things sunk the University's decision. Overall, however, the University's fundamental problem seems to have been that it tried to shoe-horn what could and perhaps should have been a justifiable "termination" into a reduction-in-force mold.

First, while the University demonstrated that it non-renewed Leibowitz due to real "budgetary issues" the evidence also showed that the budget concerns significantly diminished during her final school year and that the University had funding to hire 12 new employees during this time. When I do talks about reductions in force, one of the first things I tell folks is to accurately and consistently explain the reason why a reduction is needed. (I also caution employers about hiring into positions that impacted employees could perform.) Of course, courts don't ordinarily question why a RIF is necessary but the court will examine evidence showing that the employer's actions were not really consistent with budgetary issues.

Second, unwise statements in an e-mail didn't help the University's case. Shortly before the University told Leibowitz it was not renewing her contract, she met with an associate dean about the travel expenses issue. After the meeting, the associate dean sent an e-mail which said "Other than my mention of budget problems, I did not offer any inklings of what is yet to come! Good luck on that one; will be a tough meeting, but will be a good investment." The problem was that the Dean maintained he was still evaluating whether the university could afford to retain Leibowitz. So, the e-mail, which was unwise to begin with, became concrete evidence of inconsistencies that the plaintiff could exploit in getting the appeals court to reverse summary judgment.

The final (major) problem was that while the University characterized its decision as a layoff, it then prevented Leibowitz from finding other work within the University system (at other satellite locations). Firing the director who made a "not valid" offer of a job to Leibowitz was pretty heavy handed, but it was not all that smart to justify refusing to transfer Leibowitz because of perceived personality conflicts that were arguably stale and did not seem to matter when male employees were transferred.

Of course, it is well settled that an employer has no duty to transfer an employee to another position in a reduction in force. But it is not smart for an employer to take action to prevent an impacted employee from obtaining another available position.

There was no real doubt that the University had real budget issues. Its problem was that it used those real budget issues to fire an employee it perceived as a problem rather than relying upon a methodical selection process that accurately evaluated which employees should be laid-off. In short, if an employee is truly a problem, deal with the problem. Don't seize upon "budget issues" as a shortcut to getting rid of a headache.

Quantifying the Cost of a Reasonable Accommodation

I am something of an oral argument junkie. I read Supreme Court oral argument transcripts and listen to oral arguments when the Oyez Project updates its archive. One court of appeals, the Seventh Circuit, makes it easy to listen to arguments as they release oral argument recordings to as a podcast (including to iTunes) the same day of the argument. Other federal courts of appeals (1st, 3rd, 5th, 9th and Federal Circuits) release online oral argument recordings, the Eighth Circuit also releases a podcast (including on iTunes). Unfortunately, the Sixth Circuit (and several others, including the Fourth Circuit and D.C. Circuit) keeps its oral argument recordings to itself, requiring counsel to request the recording "in writing" and even then only releasing the recording upon the payment of a $26 fee.

When I am not working, I'll listen to the "latest" in oral arguments. (I get a lot of eye-rolls and a few jaw drops when I admit I listen to these arguments.) Of course, the arguments are most interesting (or should that be, "less dull") when the judges on the panel ask informed questions. It gets downright entertaining when the judges ask questions the lawyers can't (or won't) answer. (Clients may be dismayed to know that this happens a lot more than they might think.)

One such case, Ekstrand v School District of Somerset, was argued before the Seventh Circuit in September; the decision was issued today. I remember the argument because the judges on the panel (judges who are not considered to be "liberal" judges by any means) cut straight to the most problematic aspect of the School District's case. But I am getting ahead of myself.

Ms. Ekstrand taught first grade and kindergarten (successfully for 5 years) until she was assigned a classroom with no windows. Ms. Ekstrand, it seems, has "seasonal affective disorder" (a form of depression) and natural light helps alleviate the symptoms; artificial light, in turn, causes her difficulty. (The court found she at least arguably met the definition of disability but I'll omit any discussion of the issue given the 2008 ADA Amendments). Before the 2005-06 school year, Ekstrand asked (repeatedly) for a "natural light" room. There were two available (one teacher was willing to move and the other vacant one was being held anticipating that the school might add another third grade class). The School District worked with Ekstrand a good bit (she complained of other aspects of the inside room) but did not move her to an outside room.

Ekstrand's symptoms (fatigue, anxiety, hypervigilance, tearfulness, racing thoughts, and trouble organizing tasks) increased after the school year began; she sought medical attention, and continued to press for an outside room. After going on medical leave, she presented the school (through its "workers' compensation representative") with a note from her physician which explained that it was important for individuals who had seasonal affective disorder to have natural light and that the current episode of depression was likely caused by being in the windowless room. Ms. Ekstrand eventually quit (the court rejected her assertion that she was constructively discharged).

At argument (the lower court had dismissed the case), the court wanted to know why the school didn't move Ms. Ekstrand to the classroom so she could get natural light. The judges pressed the School District to explain what it would have cost them to move her. The School District's counsel didn't (and wouldn't) say, preferring instead to focus on what the School District had done for her instead.

Now, in fairness to the School District's counsel, there is a good bit of stress put on how the employer and employee must engage in an "interactive process." In addition, Ms. Ekstrand had already left work on medical leave more than a month before she submitted the note from her physician. By that time, there wasn't a lot of "interactive process" to be had.

The court, however, viewed the School District as arguing that the "interactive process" means the "when we get around to it" process. The move, it turns out, would have cost nothing and the disruption would have been minimal (recall that at least one teacher was willing to trade classrooms). So why didn't, the court wanted to know, the School District agree to it?

The bottom line message this decision sends is that it is a mistake to equate the "interactive process" with a "reasonable accommodation." The interactive process isn't an end result; it is a means to an end. The interactive process would have allowed the school to have proposed other "less expensive" accommodation "so long as it is sufficient to meet the job-related needs of the individual being accommodated." (29 C.F.R Part 1630 Appendix to 1630.9)

The School District thought its initial efforts met this requirement but it turns out their "good faith" steps (as even the court described them) fell short of the ultimate mandate. They were not, after all, effective in alleviating Ekstrand's condition and, when she presented the medical explanation, the School District backed itself into the corner of trying to explain how some other effective accommodation would be "less expensive" than an accommodation that doesn't cost anything to begin with.

One other important point concerns the court's holding about when the accommodation should have been made. The court didn't hold that the School District should have immediately moved the teacher upon her initial (before the school year) request. Instead, because the accommodation she requested wasn't "so widely known as a necessary treatment for seasonal affective disorder that it should have been obvious to the school district," the court held the School District acted reasonably in not moving her until she submitted the physician's note. The EEOC's Appendix to § 1630.9 permits the employer to require documentation "when the need for an accommodation is not obvious" and the court held "an employer may not be obligated to provide a specifically requested modest accommodation unless the employer is made aware of its medical necessity to the employee." (Some common sense is required here, of course.)

But, once Ekstrand submitted the physician's note, "the school district was obligated to provide Ekstrand's specifically requested, medically necessary accommodation unless it 'would impose an undue hardship' on the school district." Similarly, the EEOC emphasizes that when a request is made the employer "should act promptly to provide the reasonable accommodation" (Q&A # 10) or at least engage in the interactive process "as quickly as possible." (Id.) The simpler the requested accommodation the quicker the employer will be required to provide it. (The EEOC lists several other factors at footnote 38 of its Enforcement Guidance).

Decisions like this one are going to be more common now that the 2008 ADA Amendments have effectively changed the focus of ADA litigation from arguing over whether an employee has a disability to whether the employer accommodated the disability. Smart employers will (they should have done so already) refresh their understanding of the ADA Accommodation requirements.