Court Holds an Employer's Prior Leniency Doesn't Create Inference of Pretext

The federal court of appeals that sits in Denver issued a rather interesting race and retaliation decision today in the case of Wythe Crowe v. ADT.  Numerous complaints of harassment and improper conduct had been made against the employee (he, in turn, had complained about racial bias in promotions).  The employee was a minority, however, and the implication in the decision was that ADT, the employer, had been too lenient towards him because he was a minority.  After one more complaint of harassment, an HR manager wrote a report, which relied upon complaints against Crowe that occurred well before and after Crowe complained about promotion bias.  (The report's conclusion is worth setting out as it reflects a frustration many HR Managers feel): 

 [W]hy have we allowed Wythe to treat management and specifically, women in positions of power, with such disrespect? Why did ADT continue to try to appease this person and not support or protect our management team from this type of harassing and disrespectful abuse?  This behavior is against the law at any company in this country.  Why do we allow it here at ADT?  If Heather England took this case to the EEOC or to court, ADT could lose because we were not there to protect all employees from a hostile work environment that is free from harassment.

. . . .

The ramifications of not terminating Wythe Crowe could be huge! Think about this: What if a white male exhibits the same harassing, insubordinate, discriminatory, and disrespectful behavior as Wythe has done over the years.  If we decide to fire this person, we have now set ourselves up for a reverse discrimination lawsuit.  For that matter, since we have allowed Wythe to exhibit this type of behavior for many years, it does not matter whether the next person  is white, yellow, or pink, we are setting ourselves up for a potential lawsuit due to the precedent we have set by allowing Wythe Crowe to continue his employment at ADT.

(The court rejected Crowe's argument that this report was itself evidence of bias.)  What was most interesting was, when it came to the retaliation claim, the court rejected the employee's argument that the employer's history of being lenient towards him itself raises an inference of pretext:

Accepting Mr. Crowe’s argument would have the peculiar result of penalizing employers which, like ADT did in this case, attempt to rectify alleged inappropriate behavior instead of immediately terminating an employee upon the first transgression. Indeed, Mr. Crowe’s argument effectively inverts an employer’s incentives—if two employees engage in the same protected behavior, terminating the employee with a longer, more extensive history of serious complaints would invite litigation, while terminating the employee with a shorter, less extensive history of minor complaints would not entail that risk. In sum, ADT’s prior leniency with Mr. Crowe, without more, does not constitute evidence from which a reasonable jury could conclude that firing Mr. Crowe based on his long history of alleged in appropriate behavior was pretextual.

The idea isn't unprecedented.  Years ago, the federal court of appeals in Chicago stated essentially the same thing when it said, "we cannot vilify every employer that exercises caution in the handling of delicate employment situations." Vore v. Indiana Bell, 32 F.3d 1161 (7th Cir. 1994).

No doubt, it is always better to be as even handed as possible in imposing disciplinary action but in today's costly litigation climate, the decision preserves some flexibilty for cautious employers.

Sixth Circuit Affirms DOL Dismissal of Pilot's Retaliation Claim

Over the years (beginning in the 1970's) Congress has added a number of retaliation provision that are enforced by the Department of Labor.  Complaints are filed with OSHA (which has a special team of whistleblower investigators), a hearing is held before a DOL ALJ (there is no jury trial) who issues written findings which the losing party can appeal to a body called the Administrative Review Board (ARB), and from there, to one of the federal courts of appeals.

The Wendell H. Ford Aviation Investment and Reform Act for the 21st Century (AIR 21), 49 U.S.C. § 42121, added a retaliation provision that protects certain pilots who make safety-related complaints (I'm not being exact).  Today, the Sixth Circuit issued a decision involving a pilot ("Hoffman") who filed an AIR21 complaint against his employer (NetJets) alleging he was not promoted because he had made safety complaints about several aircraft he piloted.

There are some irrelevant procedural quirks to the decision. The only one that matters here is that this was not a summary judgment decision.  The question for the Sixth Circuit was whether the evidence supported the DOL ARB's ruling in favor of the employer.  The legal challenge came down to why others were promoted to an "initial operating experience (IOE) instructor."  The vacancy announcement for the position was pretty general.  It did not say anything about having international flight experience.  The employer, however, was having trouble recruiting pilots who could fly internationally so it wanted the instructor to have the ability to train the existing pilots.   This was a preferred, but not required, qualification.  The pilot, of course, lacked international flight experience and was not promoted. 

Normally, the absence of a crucial qualification from the position vacancy doesn't bode well for the employer when there is a challenged to a promotion decision.  It didn't hurt the employer here, however.  The court explained why:

even though international experience was not listed in the May 2004 IOE instructor position announcement, there was evidence that NetJets was indeed interested in promoting pilots who possessed such experience. This evidence included the following: Decker [Director of Flight Standards] testified that NetJets was having trouble qualifying pilots to fly their international routes and thus needed instructors who could train pilots in this area; the documentation shows that every candidate was individually evaluated in his or her amount of international experience; five of the seven successful candidates possessed such experience, and of these five, four received three points in the international experience category, the highest-possible score for the category; and Hoffman was questioned about his international experience during his interview. This undercuts Hoffman’s argument that the international-experience category, like the point system in general, was only a pretext to deny him a  promotion. Hoffman points out that two pilots received zero scores for international experience and were promoted nonetheless.  However, NetJets never contended that international experience was required for the promotion, only that it was preferred. Moreover, there is a stark comparison between these two successful candidates and Hoffman: even without any international-experience points, these two candidates received total scores of five and six, respectively, whereas Hoffman received a total score of only one.

 So while the better practice is to include all important criteria in the position vacancy announcement or the job description, it is not automatically fatal where the employer consistently evaluated every candidate using the criteria it failed to include in the position vacancy announcement and the promotion decision(s) reflect the fact that the criteria was in fact important to the selection decision.

Proving Pretext: Honest Belief v Denying Underlying Facts

There is much in a discrimination/retaliation decision the Sixth Circuit issued on Friday but the part that struck me was one that most employers don't think about at the time they are making an employment decision.  It is an important point, however, especially in light of the Supreme Court's decision in Staub v. Proctor Hospital.

The plaintiff in Bahma v. Mercy Hospital, worked as a Nuclear Medicine Technologist and, after he challenged at least one failure to promote him, was fired for engaging in unsanitary work practices an inappropriate patient care.  The incidences were documented and in many cases, the patient was the one who originally complained.  In ruling for the hospital on the retaliation claim, the court providing one of the best examples of the difference between supporting an employment action with an "honest belief" and the employee's denial of the underlying facts:

The evidence indisputably shows that Mercy received several patient complaints regarding Bhama’s infection-control procedures and professionalism in the months preceding his termination, including one stating that Bhama disposed of a blood-soaked cotton ball with his bare hands and immediately afterwards tried to administer an injection without washing up. Bhama never denied that Mercy received these complaints, he simply denied the truth of the allegations and dismissed them out of hand as inadmissible hearsay.

The message for employers should be pretty clear.  Before taking action, properly investigate and make sure employment action is supported by the facts.  If the employee disputes the facts, make sure the investigation fully explains why the employee's assertions are not accepted or believable.

Separating Protected Complaints from Misconduct

An Air Tran employee in Dayton convinced the Sixth Circuit to reverse summary judgment for his employer in a Title VII retaliation claim.  The employee had complained to his station manager that his immediate supervisor was racially biased.  The employee, in the supervisor's mind, was a poor performer and caused problems.  In a meeting where the employee was suspended for misconduct, the station manager told him (allegedly)  "I'm tired of your complaints" against the supervisor.  While there were other reasons the court reversed summary judgment, the station manager's alleged statement was a major factor.

Perhaps the station manager did not mean to include the racial complaints in the set of complaints she was "tired" of receiving but the lesson is that employers should always be careful not to make comments that could be taken as criticizing protected activity.  That includes being careful not to make broad and ambiguous comments of the type allegedly made here.

The name and link to the unpublished decision is Hill v. Air Tran Airways (6th Cir. 3/23/2011).

US Supreme Court Says Oral FLSA Complaints are Protected

Resolving a split in the federal courts of appeals, the Supreme Court today held that an oral complaint of a violation of the Fair Labor Standards Act is protected conduct under the FLSA's anti-retaliation provision.  Here is the interesting part:

[T]he statute requires fair notice. Although the dictionary definitions, statutes,regulations, and judicial opinions we considered . . . do not distinguish between writings and oral statements, they do suggest that a “filing” is a serious occasion, rather than a triviality. As such, the phrase “filed any complaint” contemplates some degree of formality, certainly to the point where the recipient has been given fair notice that a grievance has been lodged and does, or should, reasonably understand the matter as part of its business concerns.

Moreover, the statute prohibits employers from discriminating against an employee “because such employee has filed any complaint.” [29 U.S.C.] §215(a)(3) (emphasis added).And it is difficult to see how an employer who does not (or should not) know an employee has made a complaint could discriminate because of that complaint. But we also believe that a fair notice requirement does not necessarily mean that notice must be in writing.

* * *

To fall within the scope of the antiretaliation provision, a complaint must be sufficiently clear and detailed for a reasonable employer to understand it, in light of both content and context, as an assertion of rights protected by the statute and a call for their protection. This standard can be met, however, by oral complaints, as well as by written ones.

The full decision in Kasten v. Saint-Gobain Performance Plastics Corp. can be read at http://www.supremecourt.gov/opinions/10pdf/09-834.pdf

Get Your Story Straight Before Taking Action

A decision released today from the Sixth Circuit illustrates that Tennessee employers need to get their story straight before firing an employee. 

Brookdale Senior Living, Inc. is, its website says, the nation’s largest owner and operator of senior living communities throughout the United States and a leading national provider of senior-related services. The plaintiff, David Eades was a Regional Director of Start-up Operations.  Eads thought his new supervisor harassed and degraded him because of his age (he was in his early 40s).  Eads complained about it to HR and later to the company president.  Eads and the company discussed a severance package and Eads was sent home with the assurance that he was not fired.  Eads later learned his supervisor was telling folks he had been fired and he could no longer access his email from outside of work.  

The court of appeals held Eads was entitled to a jury trial.  The problem for Brookdale was that, as the court said it was "advancing different reasons in its brief on appeal than it represented to the district court."  Even worse, Brookdale's assertions in the litigation were not the same as those it made in response to Eads EEOC charge.  Brookdale's in house counsel said in the response that Eads had been terminated for "lack of any performance in any position."  This answer was so far wrong that Brookdale's brief on appeal "explicitly denies having terminated Eades for performance issues" saying its counsel had made a mistake. As the court said, however, "Brookdale offers no evidence that either one suggested that the response was erroneous, nor does it explain how its Senior Vice President for Legal Services made such a 'mistake.'"

The inconsistency with the EEOC response was not the only problem. Brookdale's lawyers appear to have put to much "spin" on the severance discussions. They asserted that Eads said "he could not work with [his supervisor] and that he wanted a severance package, but this position is inconsistent with the record testimony of the attendees of that meeting."

The problem with Brookdale's case wasn't simply that it gave unsupported reasons for firing Eads.  Any one of the reasons Brookdale advance might have valid ones (had the facts been in support).  But when employer  and employer asserts different and inconsistent reasons for a decision, that is itself evidence of pretext, as the court said: “An employer’s changing rationale for making an adverse employment decision can be evidence of pretext.”  

In practice, there will be some debate as to what amounts to a "changing rationale."  Courts rightly look to whether the changing reasons are inconsistent, not merely changing.  For example, courts recognize that expanding on a reason already advanced does not ordinarily amount to taking an inconsistent position.  Here, however, Brookdale's assertion to the EEOC that performance was the sole reason for firing Eads could not be reconciled with its position in the litigation.  

By now, the lesson is obvious.  Before taking any employment action, employers need to investigate the  facts and make sure the explanation given at the start is something the employer can live with if litigation ensues.

Refusing to Return Employee to Work that Poses "High Risk of Re-Injury" Is Not Retaliatory

The Tennessee court of appeals has upheld the dismissal of a workers compensation retaliation lawsuit brought by an employee who was discharged when two board certified physicians determined that if she was returned to work she had a high risk of re-injuring herself. 

The idea that an employer need not return an employee to a job that would be likely to cause future injury is not new.  See Cannon v. Levi Strauss & Co., 29 Fed. Appx. 331 (6th Cir. 2002) (an ADA "regarded as" claim where employer terminated employee because her physician said continued work sewing pants put her at high risk for future carpel tunnel injuries).  What is relatively new is its application to workers compensation retaliation claims (though even here, a decision from years ago had held that an employer did not retaliate against an employee by firing the employee when the employee could not return to work because of a workers' compensation injury).

Yesterday's court of appeals decision today makes this point directly:

There is no evidence in the record that Plaintiff’s filing of workers’ compensation claims played any role whatsoever in the decision not to return her to work. The prohibition against retaliating against employees who file workers’ compensation claims does not guarantee an employee the right to return to work when such return poses a high risk of re-injury. Stated another way, the prohibition against retaliation does not guarantee employees the right to return to work and to continue reinjuring themselves until they are so disabled that they are permanently and totally disabled and can never work again.

Of course, getting to the point of proving that the employee's return to work is likely to cause the employee harm might take some work.  What impressed the court here was that the employer relied upon the advice of "two physicians who are board certified in occupational medicine" (one of whom was the employer's on-site physician).  While relying on a physician who is board certified in occupational medicine clearly helps, the decision does not say that board certification itself is necessary.

What should matter is that the physician has the expertise to make the decision (board certification certainly helps here) and the medical decision evaluates the employee's abilities (as opposed to making assumptions based upon labels).  

Ten years ago, Chattanooga found itself on the wrong end of a disability discrimination decision when it unreasonably relied upon a physician's advice that an HIV positive individual was not qualified to be a police officer.  There, the Sixth Circuit explained why the City's reliance was not reasonable:

Dr. Dowlen's "report" consists of two scribbled lines at the bottom of a boilerplate evaluation form. While the psychiatrist in Pesterfield clearly made an individualized determination as to the plaintiff's medical condition and its effect on his ability to fulfill his job requirements, there is no indication that Dr. Dowlen did anything of the sort. Moreover, the record is replete with factual evidence available to the City at the time --particularly Holiday's successful performance of police jobs that Dr. Dowlen claimed he was unqualified to do -- that flatly contradicted Dr. Dowlen's unsubstantiated conclusion. Under these facts, the City was not entitled to simply rely on the physician's recommendation as the basis for withdrawing its employment offer to Holiday.

Holiday v. Chattanooga, 206 F.3d 637 (6th Cir. 2000).

Employers are often presented with conflicting medical opinions (sometimes from the same physician).  Courts have held that an employer who fairly evaluates competing medical opinions do not discriminate against an employee because of the employee's disability.  Knapp v. Northwestern University, 101 F.3d 473 (7th Cir. 1996) ("in the midst of conflicting expert testimony regarding the degree of serious risk of harm or death, the court's place is to ensure that the exclusion or disqualification of an individual was individualized, reasonably made, and based upon competent medical evidence.").

Presented with conflicting medical information, the EEOC suggests employers consider: 

(1) the area of expertise of each medical professional who has provided information; (2) the kind of information each person providing documentation has about the job's essential functions and the work environment in which they are performed; (3) whether a particular opinion is based on speculation or on current, objectively verifiable information about the risks associated with a particular condition; and, (4) whether the medical opinion is contradicted by information known to or observed by the employer (e.g., information about the employee's actual experience in the job in question or in previous similar jobs).

Court of Appeals Recognizes Public Interest Exception to Retaliation Claims

The Court of Appeals in Atlanta issued an interesting decision today.  To simplify the facts to their essence (the decision is 34 pages long), no one was good enough for the employer's CFO.  The plaintiff was the third in a line of employees fired when their performance did not measure up to the CFO's impossible standards.  As the court said, the CFO "was indiscriminately persnickety."

Seeing the writing on the wall, the employee fired off an email complaining about discrimination.  She lost the discrimination claim because, the court said, there was no evidence this employee was treated better than her two predecessors.  (For this the court cited what it called the Vince Lombardi rule: "someone who treats everyone badly is not guilty of discriminating against anyone.")

But a meritless discrimination claim can spawn a meritorious retaliation claim.  Here, however, the evidence established that the CFO had decided to fire the employee before she sent the complaining email; the CFO had even started looking for another person to mistreat.

What turned this case into a problem was that the CFO fired the employee immediately upon learning about the employee's complaint instead of sticking with the plan to fire the employee once a successor was hired.

Rather than permit the employee to sue for the firing, the court held she could only sue for the premature firing.  She would been fired anyway, the court said, so the only thing she could recover for was the financial loss during the period she would have remained at work.

What made the case interesting is that the company argued the employee was fired when she complained because it was afraid that the employee might vindictively use her position (remember she worked for the CFO) and the access it granted her to sabotage the company’s operations.  That, the court said, could justify  firing the employee earlier than planned.  The court explained:

Discrimination laws do not require that their goals be pursued at the cost of jeopardizing innocent life or that employers tolerate a serious risk that employees in sensitive positions will sabotage the company’s  operations. We are confident that if an employer removes an employee because of a reasonable, fact-based fear of sabotage or violence, the anti-retaliation provisions of our laws will not punish that employer for doing so. 

What was a good theory failed in its implementation.  The company failed to show its concerns were justified enough to warrant dismissal of the retaliation claim.  The court observed that the employee's email made no threats.  The company also failed to show that it had any other basis for thinking she would try to disrupt operations, nor was there evidence that there were "no means short of firing [the employee] that it could have used to protect itself from the sabotage it feared, such as reassigning her to other duties until it found a replacement."

So while the court recognized an exception to a retaliation claim, it also made it clear that the exception will need to be supported by something more than speculation and unfounded fears by the employer.

What the decision also shows, however, is that rushing to judgment is never a good idea.  Without some well-founded basis for thinking there was an eminent danger or risk, the company should have had the strength of its own convictions and not altered its course.

You can read the decision on the Eleventh Circuit's website: Alvarez v. Royal Atlantic Developers.

When Investigations Go Wrong

Just as a housekeeping matter, on July 27, 2010, the Home Depot decision I discussed in this post was vacated by the court of appeals and the lawsuit was dismissed.  (They even took down the reported decision so the link below doesn't work.)  This happens, most likely, when the parties reach a settlement, as one legal journal has reported.  It means that as legal precedent, the decision is no longer binding. Of course, the cost of taking the case all the way to court of appeals before settling it was significant so I hope employers will learn from Home Depot's experience.

I am returning to one of my frequent topics, how an employer can avoid liability by conducting an independent investigation.

I've emphasized that employers need to make sure to conduct a fair investigation. This means, as one post emphasized, that employers need to listen to the employee and form an opinion only after hearing the employee's version of events. It also means, as a minimal standard, looking into how similarly situated employees have acted without being disciplined.

An appeals court decision involving Home Depot managers from Florida and Alabama provides additional fodder for employer investigatory mistakes. Two Home Depot store managers were fired after complaining about sexual harassment by a regional HR Manager. The store managers lost the harassment claim but persuaded the appeals court to reverse the retaliation claim.

Home Depot deserves some criticism for the manner in which it terminated the store managers. They didn't produce a written policy (about personal use of a company cell phone) and did not have very strong evidence that the store managers gave out discounts to vendors beyond what other store managers had done. Worse still, there was some evidence that some of the "illegal" discounts were actually authorized by district managers; the discount policy was not put into evidence as an exhibit.

It is never good when the court's discussion of the investigation starts by saying that it was "riddled with inconsistencies and contradictions." Perhaps no adequate investigation could have rescued Home Depot - but that is an issue for a trial. For employers that want to avoid a jury trial in a termination case, however, the decision points to several problems to avoid in conducting an investigation into employee misconduct.

Timing is everything. Home Depot maintained it fired the store managers because it began investigating improper discounts in "late Spring of 2005." The earliest documentation in the investigatory file, however, was dated late September 2005. Also some of the documents that were purportedly relied to make the termination decisions were dated after the store managers were fired. (Even so, one decision-maker testified she reviewed these documents before she decided to fire the store managers.)

Conduct an even-handed investigation. Home Depot maintained that the investigation into improper discounts was district wide. Yet, the investigator's notes about the two store managers who were fired was "far more detailed" than for any other store manager. The investigator maintained he was "never particularly focused" on the two fired store managers. No doubt, it is natural to see an increase in detail when the violation might lead to firing an employee. The important point here is that in any investigation, the same type of information should be retrieved for everyone, not just the ones who are ultimately fired.

Firewall the accused. The whole point of an investigation is to provide the employer with a non-discriminatory motive. That point is lost where, as here, there was evidence that the person accused of harassment is not obviously excluded from the investigation (in any investigatory capacity). Home Depot maintained otherwise (it appears the decision-makers were never told about the allegation of harassment) but when the termination notice is signed by the accused harasser (among others), and the accused harasser delivers the bad news, the employer is not making it easy for the court to see that the investigation is fair and above board. (It didn't help that the accused harasser bragged, allegedly, about getting the store managers fired.)

Follow company policy. The court of appeals roundly criticized Home Depot because "no specific policy violations" were listed on the termination notices even though the forms said to specify the policy that had been violated. The problem was particularly acute here because the store managers maintained that there was no policy. Strictly speaking, this last point wasn't a failing of the investigation itself but the court found this failure called into question the legitimacy of the investigation. It is a good practice point. Any investigation should, at a minimum, identify the exact policy that governs the situation.

Sixth Circuit Holds Protected Activity Must be Personal

First, I should mention that the prior post was written shortly before I left on vacation so let me apologize for the gap between posts here.

Not long after I returned the Sixth Circuit issued an important decision. It is important for what the court didn't do and for the caution the court issued. The decision in Thompson v. North American Stainless was issued by the full court. Like all other federal courts of appeals, the Sixth Circuit most often convenes 3 judge panels to resolve appeals. It can, however, convene the full court if a sufficient number of judges agree that there is an issue the entire court needs to resolve. Most of the time, the reason to convene the full court is that there are at least two decisions from the 3 judge panels that cannot be reconciled. That was the primary reason for the full court to hear the decision in Thompson.

A 3 judge panel in Thompson had held that someone who had not personally engaged in protected activity could nevertheless be retaliated against in violation of Title VII. The panel imposed a rather unmeasureless standard, saying the "victim" only had to have some relationship - in that case the spouse - to someone who had engaged in protected activity.

That decision was not entirely consistent with other panel decisions or what a majority of the court thought was the "plain text" of Title VII. So, reversing the panel, the full court, by a 10 to 6 vote, held that the person claiming to have been retaliated against must show that he or she personally engaged in protected activity. I won't go into the majority's reasoning other than to say they agreed with other courts of appeals that the relevant language in Title VII mandated the holding.

The decision is important for employers because it gives them some means of assessing who is within the protected activity realm. Had it held, as the panel did, that someone who is merely associated with another who has engaged in protected activity, the set of employees who could sue for retaliation would be markedly expanded. While Thompson relied upon his fiancé’s protected activity, the holding would have been expanded to children, siblings, friends and so forth. The set of those potentially protected would have been virtually limitless.

The full court decision is good news but there are several important cautions. First, an employee such as Thompson could have easily engaged in some protected activity merely, for example, by letting the employer know he supported his fiance's position. It would not have required much effort as I explained in discussing the Supreme Court's decision in Crawford v. Metro. Gov’t of Nashville and Davidson County, Tenn., — U.S. — , 129 S. Ct. 846 (2009).

Second, as the full court acknowledged, even if Thompson had no claim, his fiancé could still argue that Thompson was termination was directed at her. Remember, on this point, that the Supreme Court has said the retaliation provision in Title VII does not confine retaliatory acts to those related to employment or the workplace.

So while the full court's decision is a victory for Tennessee employers, it still doesn't mean employers have free reign to retaliate against someone for what their spouse may have alleged. The far better method, of course, is to make sound decisions based upon the facts by conducting as thorough an investigation as the incident demands.

Firing an Employee on His Return from FMLA Leave

As lawyers, we sometimes have a non-practical view of the workplace. For example, to us the FMLA is about "leave" when in reality, the more fundamental point of the FMLA is to project the employee's job when the need for leave ends. The right to medical leave would be worthless without the right to reinstatement, a point the Sixth Circuit made last August.

A court of appeals decision last week, however, addressed a situation where the employer discovered performance problems while the employee is on FMLA leave. Mr. Cracco worked as a Service Center Manager for Vitran Express, a trucking company, at one of its Illinois terminals. He took approved leave for a medical condition and Vitran hired "several replacements" to cover his job while he was gone. The replacements discovered numerous problems, disorganization, not following of procedures, freight sitting on the dock, damaged fright hidden, safety concerns, customers complaining, overtime not being handled properly, and discrepancies in freight records. Based on these reports, the company launched an investigation, determining that Cracco had not simply made mistakes but had engaged in "deliberate attempts to disguise late and damaged deliveries." For that reason, Vitran then fired Cracco the day he returned from FMLA leave.

Cracco sued, claiming retaliation and interference under the FMLA. The court rejected all of his arguments. On the retaliation claim, the court held that the FMLA did not per se prohibit an employer from terminating an employee because, while the employee was on leave, the employer learned of misconduct. Notice the "but for" connection here. If the employee had not gone on medical leave, the employer might never have learned of the faked records. But that is not enough in itself to show legal causation under the FMLA.

Cracco's FMLA inference claim foundered because of that portion of the FMLA which provides that an employee's right to reinstatement is not absolute and the employee is not entitled to "any right, benefit, or position of employment other than any right, benefit, or position to which the employee would have been entitled had the employee not taken the leave." 29 U.S.C. § 2614(a)(3)(B). So, an employee is not entitled to reinstatement if the employer can "present evidence to show that the employee would not have been entitled to his position even if he had not taken leave." Now here is the important point about Cracco v. Vitran.

Vitran presented "substantial evidence" that Cracco had faked records, of its investigation and how it learned of the misconduct in the first place. In contrast, the employee presented "no evidence" that the reports were not made or that Vitran's investigation was not an honest attempt to ascertain the accuracy of the allegations.

There's no question that an employer may take employment action against an employee for what the employer discovers while the employee is on FMLA leave. The real issue is what is behind the discovery. Honest investigations, as I have stressed elsewhere, are the key. Even on the interference claim, the issue in this case wasn't whether or not the misfeasance had occurred but whether or not the employer honestly believed it occurred. The employer showed this by conducting a thorough investigation – though oddly enough, the court never mentioned whether or not the employee had been interviewed as part of the investigation. (There would have been good reasons for not interviewing the employee: he was on medical leave and the performance issues were self-evidence in the delivery records). There was also a lack of evidence regarding how the employer had treated similarly situated employees and this evidence can be quite crucial in any discrimination lawsuit.

A word to the wise. Because the taking of FMLA leave is itself protected, the timing of any employment action is going to look bad so a smart employer will be extra-careful in documenting the investigation, the basis for the decision and whether any other remotely similar incidents are distinguishable or not.

Stimulus Bill Whistleblower Provision - Conference Version

I previously posted about the different versions of the whistleblower provision in the stimulus bill.

The stimulus bill whistleblower statute finally adopted by the conference committee (where members of both houses of Congress meet to resolve difference in bills both have passed), is quite different, better in some ways, worse in others, and still ambiguous (Congress gift to lawyers?) in troubling ways.

The link above is to the pages of the stimulus bill (this link is to Congress' website where I obtained the stimulus bill).

Here is a quite and dirty summary of the changes and a short commentary about them.

Protected activity is now tied to complaints about mismanagement, waste, and abusive spending of stimulus (what the statute calls "covered" funds). The bill stills protects complaints about public health but now those complaints must be about "a substantial and specific danger to public health or safety related to the implementation or use of covered funds." My concern with the provision as it came out of the Senate and House was that neither version specified that complaints must be related to stimulus spending. That ambiguity has been resolved.

I originally said neither version of the bill expressly covered "internal" complaints, that is, complaints by employees to supervisors. It now does. Complaints to "a person with supervisory authority over the employee (or such other person working for the employer who has the authority to investigate, discover, or terminate misconduct)" are protected even if the employee's "disclosure [was] made in the ordinary course of an employee's duties."

It also means that if you do not receive stimulus money (directly or indirectly), complaints by your employees about your spending are not covered by the whistleblower provision. (They may be covered by other whistleblower statutes, however, depending on whether or not your company does business with the government.) The provision still covers state and local governments that receive stimulus money as well as the contractors and subcontractors who perform work for the state or local government using stimulus money.

Complaints must still be submitted to the inspector general ("I.G.") of the respective agency. My concerns about the I.G. and whether it has employees qualified to investigate retaliation claims still stands.

The conference added a section that addresses who has to establish what. The employee must show the protected activity "was a contributing factor" in the retaliatory action (don't get tied up about causation levels, there is no difference between a "because of" or "motivation" or "contributing" factor as humans are not capable of understanding these degrees of motive).

The provision goes on, however, to add that "circumstantial evidence" can be used to establish a contributing factor" and that includes "evidence that the official undertaking the reprisal knew of the disclosure" or that the reprisal occurred within a "period of time after the disclosure such that a reasonable person could conclude that the disclosure was a contributing factor." This is, of course, based upon the illogical "temporal proximity" causality. The irony is that a "reasonable" person (that is, a person who relies on "reason") would not, by definition, rely upon temporal proximity because it is an illogical doctrine.

Note that the statute does not say either knowledge alone or temporal proximity alone automatically satisfies the contribution factor test. It simply says either "may demonstrate" causation. That leaves it open for employers to argue other factors show there is no causation.

Employers may also defeat causation by showing with clear and convincing evidence that they would have made the same decision regardless of the even if the employee had not made the protected disclosure. Unlike the Title VII version of this defense, this is an absolute defense.

The I.G. still does not have to make a decision on the record so there is no requirement for a hearing at the agency level. The stimulus bill gives the parties the right to obtain a copy of the agency file (with limited exceptions) if the claim goes to litigation in federal court.

The conference committee added a new provision (not found in either version) that prohibits "any agreement" that would waive the "rights and remedies" in the statute. This includes a prohibition on arbitration unless the arbitration is authorized by a collective bargaining agreement. What Congress seems to be trying to do is prohibit predispute waivers of rights but read literally, this provision would make unenforceable any settlement of a stimulus bill whistleblower claim.

Because the provision still fails to include a statute of limitations, the prohibition against "any agreement" waiving rights or remedies is particularly troubling. Presumably, a court or agency approved settlement would be enforable but the provision does not authorize any agency or court to approve settlements. Without authorization, agencies and courts are unlikely to act (though a court could enter a "final" judgment). What employer (or employee) wants to wait some three to four years before knowing if a settlement is enforcable.

Finally, covered employers must post a notice about the "rights and remedies" under the whistleblower provision.

Even "Compelled" Statements During Harassment Investigation are Protected

The Supreme Court has issued its decision in Crawford v. Metropolitan Government of Nashville and Davidson County and not surprisingly held that Ms. Crawford's statements were protected by the "opposition" clause of Title VII. I previously discussed Crawford in a prior post so I won't say too much about it here.

Two points are noteworthy.

The Court generally held statements during an internal investigation that report harassing conduct are protected but the Court also observed: "It is true that one can imagine exceptions, like an employee’s description of a supervisor’s racist joke as hilarious, but these will be eccentric cases . . ."

The Court's decision rested solely on the opposition clause of Title VII. The Court did not address whether an employee's participation in an employer's harassment investigation was "participation" clause protected activity. That avoids at least one headache for employers.

Retaliation, Honest Beliefs and Employer Investigation

Taking a risk that I am harping on it too much, today's Sixth Circuit dismissal of a retaliation claim again confirms the value to an employer of conducting an investigation.

Understand my point of view: when my partners and I defend a lawsuit for an employer, we work hard to get the claims dismissed prior to a trial. (It isn't that we don't like trials, some of us do, but it is much more efficient and less risky for the client to get the claims dismissed early on.) With few exceptions, we have to show that even if the evidence were as the plaintiff says it is, our client should still win.

The decision today concerned a lady who alleged she had been harassed and then fired because she complained of harassment. Understand the timing, the employee complained about racial and sexual remarks by a co-worker, filed an EEOC charge, and was then terminated because, the employer asserted, she had filed a false injury report.

The employee claimed she had injured her back when a co-worker (the person she had accused of making harassing remarks) moved a truck while she was standing in its flatbed. The employer investigated even to the point of conducting a hearing where it received testimony (while the decision doesn't explain why a hearing was held, it was likely to satisfy some provision in the union contract). The co-worker and four other employees said they didn't see her in the bed of the truck and that she was, in fact, standing beside the truck when it was started. At the hearing, and at trial, the employee adhered to her story, saying the four witnesses were lying to protect the co-worker.

In dismissing her claim, the court avoided addressing the temporal proximity issue (or the more interesting question about the filing of an EEOC charge over the harassment claim after the employee had been suspended pending an investigation into the making of a false report. Rather, the court held that even if the employee had not filed a false report (as she continued to assert) and even if the four witnesses were lying to support their co-worker, the employer's investigation was sufficient justification for firing the employee. As I said earlier, when an employer is faced with competing versions of events, "there is probably no practical step an employer can take beyond independently investigating the misconduct charges that will reduce the chances of an employee's racism influencing its behavior." Brewer v. Bd. of Trs. of Univ. of Ill., 479 F.3d 908, 920 (7th Cir.), cert. denied, 128 S. Ct. 357 (2007).

Why is this so important? At the start I said employers benefit from early dismissals of lawsuits and to get them dismissed we have to show the material facts are not disputed. Here, there was a factual dispute - was the employee in the bed of the truck when it was started - but the employer's investigation resolved that fully and fairly. The investigation made the factual dispute immaterial because the focus was then on the honesty of the employer's decision, not on whether or not the employee had in fact filed a false report. Had the investigation not occurred (such as had the employer promptly fired the employee based solely upon the co-worker's story), or had it been slipshod, the court could have held a jury needed to determine whether the employer retaliated against the employee.

West Wing, Retaliation and the Prima Facie Case

The murky title necessitates explanation. Frankly, I wanted to avoid adding to the almost 3,000 blog posts, many of which are entitled "post hoc, ergo propter hoc." So, since one of the early episodes of the West Wing very effectively used this as an episode title, I can avoid a cliché and am given a painless way to define the Latin term.

In the West Wing episode, the President utters the phrase and when no one immediately answers, says "27 lawyers in the room. Anyone know "Post hoc, ergo propter hoc"? Finally, one answers, "after it, therefore because of it," which is as good a definition as necessary for this post.

The point is that while causation (which courts also refer to as a "nexus) requires the cause to precede the effect (at least in our universe) that doesn't necessarily mean that what happens before the effect is the cause and it is a "logical fallacy" to suggest otherwise. Huskey v. City of San Jose, 204 F.3d 893, 899 (9th Cir. 2000).

Logical fallacies, however, seems to be the norm for retaliation claims these days. For the last several years, the judges on the Sixth Circuit have engaged in an extensive and utterly pointless debate over whether "temporal proximity" alone justifies a rebuttable presumption that two events which are close in time and are therefore causally related. (Employment lawyers call this the prima facie case, which simply translates to "at first view : on the first appearance".) Mickey v. Zeidler Tool & Die Co., 516 F.3d 516, 525 (6th Cir. Mich. 2008), admirably sought to reconcile the competing views but only seems to have agonizingly prolonged the dispute.

To be clear "temporal proximity" simply means "events near in time" but it has been so horribly misused (even being used in Mickey to refer to events that were not close in time) that it should be banished from the legal lexicon. For one, too close a focus on timing diverts attention away from other evidence that is likely to be much more probative of a retaliatory animus.

Where this intersects employment law is that employment discrimination claims necessarily determine causation. In discrimination claims, where causality focuses upon a person's status, timing is usually unimportant (except perhaps in disability discrimination claims). But in retaliation claims, where the causality focus looks to the relationship between two acts, timing takes on an importance it shouldn't.

A recent retaliation decision from the Tennessee court of appeals in Kinsler v. Berkline LLC, held post hoc reasoning applies to all types of retaliation claims in Tennessee. It relied upon Allen v. McPhee, 240 S.W.3d 803, 823 (Tenn. 2007), which had held "that close temporal proximity of a complaint and a materially adverse action are sufficient to establish a prima facie case of causation."

Philosophical and logical issues aside, one mistake many cases (including Kinsler) make is in ignoring what occurs before the supposed "cause" of the "effect." In Kinsler, for example, the employee claimed he had been unlawfully fired 3 days after he refused a workers compensation settlement. But the employee had been injured, sought workers compensation benefits and had filed some type of an action seeking to be paid comp benefits long before he refused the settlement. Those events were remote in time and an employer bent on retaliating against an employee who wants workers' compensation benefits might just as well have based a decision on those events as it did on the event that immediately preceded the firing.

Now, for all we know, the settlement was the "cause" of the employee's firing but there was no evidence of this other than the timing (according to the decision, at least) and the employee's supposition. But if that is all there is to go on, then it is just as reasonable to say seeking workers compensation benefits had no roll in the firing.

Those decisions which have held that temporal proximity, when coupled with "other evidence of retaliation", to quote Mickey, can show "causation" (and by that I still mean a rebuttable presumption of causation) may provide comfort to an employer's lawyer but are no better in rationale. After all, if there is "other" evidence of retaliation, what does it add to say there is or is not a "temporal proximity" between events?

Along these lines disciplinary action antecedent to the protected activity is oft overlooked in the "temporal proximity" analysis. This occurs, even though as the Supreme Court in Clark County School District v. Breeden, 532 U.S. 268, 273 (2001), explained, employers "proceeding along lines previously contemplated, though not yet definitively determined, is no evidence whatever of causality." Or, as another court has said, "Where timing is the only basis for a claim of retaliation, and gradual adverse job actions began well before the plaintiff had ever engaged in any protected activity, an inference of retaliation does not arise." Slattery v. Swiss Reinsurance America Corp., 248 F.3d 87 (2nd Cir. 2001).

Or suppose that between the cause and effect, there is an "intervening" cause. Take Freeman v. Ace Tel. Ass'n, 467 F.3d 695, 696 (8th Cir. 2006), where the employee was fired three weeks after he told the board of directors that the company's mileage reimbursement policy might result in violations of federal income tax laws. While this sound pretty bad from a purely timing perspective, a week before the employee was fired, he sent the board a sworn statement admitting (as the board had suspected) that he had been in a sexual relationship with a female subordinate employee, lied to the board about it and had even used a company credit card to buy Viagra to continue the sexual relationship. Not surprisingly, the court held, the "intervening events undermines any causal inference that a reasonable person might otherwise have drawn from temporal proximity."

Where does this leave Tennessee employers? An employer that makes a "knee jerk reaction" is asking for it. A judge and jury don't need "temporal proximity" to understand an employer's motive when the employer fires the employee right when the employee complains. And whatever philosophical problems there may be with "temporal proximity," it is not smart to hand an employee a termination notice soon after the employee complains unless the employer has antecedently documented the employee's misconduct or an event after the complaint clearly justifies the action.

Protecting Participation in an Employer's Sexual Harassment Investigation

Last week the U.S. Supreme Court held oral arguments in Crawford v. Metropolitan Government of Nashville and Davidson County. Scotusblog.com is a highly regarded blog that lets everyone easily keep track of Supreme Court cases. Yesterday, they published a summary of the argument which you can review here. If you don't want to take their word for it, you can read the official transcript of the oral argument from the Supreme Court's website here.

The case concerns a sexual harassment investigation in which several female employees, one of whom was the plaintiff (Ms. Crawford), were called to meet with the investigator. During this meeting, Ms. Crawford said that she and other female employees had been harassed. Six months or so later, Metro terminated Crawford on what she said were unfounded charges of embezzlement and drug use. She sued claiming her termination was in retaliation for her statements during the investigation.

As scotusblog.com's summary reflects, the Supreme Court appears to be leaning toward holding Crawford's statements to be protected under Title VII. The Sixth Circuit had rejected this reasoning saying Crawford cooperated with the investigation "by appearing for questioning at the request" of the investigator. To oppose unlawful activity, the court held, an employee needs to take some action. Crawford v. Metro. Gov't of Nashville & Davidson County, 211 Fed. Appx. 373 (6th Cir. 2006). Forgetting the fine legal distinctions at issue in the case, any employer that takes action against an employee because of what the employee said during the employer's internal investigation of a sexual harassment allegation acts on very thin ice. I've addressed that previously so enough said.

But the more important point, which might not be addressed by the Court but is nevertheless worth mentioning, is whether an employee's participation in the employer's internal sexual harassment investigation (regardless of what is said) constitutes protected activity.

Under the Title VII retaliation provision (as well as many others), an employee can oppose unlawful activity or the employee can "participate" in a proceeding or investigation into whether the employer's conduct violated Title VII. For opposition clause protected activity, what the employee says is what matters. For participation clause activity, all that matters is the fact of the participation itself.

In the Sixth Circuit's view, Metro's internal investigation was not participation clause activity because "at a minimum, an employee must have filed a charge with the EEOC or otherwise instigated proceedings under Title VII."

This is not the place to go long into the legal distinctions. If you want to see the "no win" scenario example, look at Merritt v. Dillard Paper Co., 120 F.3d 1181, 1183 (11th Cir. 1997), where the court held that the employer could not lawfully fire an employee because, during his deposition testimony in a sexual harassment lawsuit, he admitted engaging in some of the harassing conduct. The admission was costly to his employer and they fired him as a result. The employee could be fired for harassing employees, the court said, but not because he testified truthfully about harassing them.

To return to reality (subject to change by the Court), the threshold for participation clause activity is clear and easy to apply. It requires the instigation of some formal legal proceeding, such as the filing of a lawsuit or charge of discrimination. Booker v. Brown and Williamson Tobacco Co., Inc., 879 F.2d 1304, 1313 (6th Cir. 1989). Courts and Congress, however, don't often favor employers (or employees, as the street to ambiguity never runs one way) with bright line rules, and here, the government (representing the views of the EEOC) at argument favored having the participation clause protect employees who cooperate in an employer's internal investigation.

Why does it matter? In most cases it won't. In many employer investigations, employee statement are likely to fall within the "opposition" clause. But take the Dillard Paper example. Suppose, instead of being at a depositon, the harasser had been summoned to meet with the HR manager investigating the underlying harassment charge and then admitted to engaging in horrific conduct toward the vicitimized employee? If the EEOC gets its way, may the employer, at this point, fire the harasser? After all, the employer is under pretty strong legal pressure to fire the harasser (even though the cases say this not always required).

Title VII was never meant to immunize employees from the consequences of their own unlawful conduct. But if any statement, even an admission of harassing conduct, is protected if it is made during an employer's investigation, where does that put the employer who wants to rid the workplace of all individuals who might harass other employees?

With the Supreme Court leaning heavily toward reversing the Sixth Circuit on the opposition clause issue, it may leave the participation clause issue for another case. But for now, it is enough to say there is a risk. So be careful not to put yourselves in any situation where you might end up having to defend your position to the Supreme Court.

Discipline for False Accusations of Harassment

Most sexual harassment policies include some kind of a warning about what could happen to an employee who makes a false accusation of harassment. The clause is not meant to discourage harassment claims but to ensure that employees do not use the potentially career-ending allegation of harassment as a way of exacting retribution for personal disputes.

A recent federal court of appeals decision from Missouri (which governs employers in the Midwest and north-Midwest states) helped clarify when employer may take action for falsely reporting harassment.

The male employee was the subject of a complaint by a female co-worker who reported that the male had gotten angry with her when they were discussing a policy matter. At the same time, the male reported to the HR department that the female had asked whether he had a girlfriend, made inappropriate sexual comments to him and that she had engaged in affectionate contact such as hugging or placing her head in his lap, He also said she had shown up one Sunday morning and asked to take him to church.

During the investigation, the female employee denied the allegations saying the male employee was pursuing her. She also produced a hand-drawn map the male had given her showing how she could get to his house. When confronted with this evidence, the male said: “I guess I was wrong for doing this.” The city ultimately fired him not only for making a false report but for his history of losing his temper on the job. A disciplinary board upheld the termination. The male employee sued claiming his termination was in retaliation for reporting the female employee's sexual advances.

Citing one of its prior decisions, the court of appeals explained why this case was one of the unusual situations where the court of appeals could hold as a matter of law the employer honestly believed the employee had made a false harassment complaint. The court of appeals contrasted the facts in this case with the situation that occurred in a 2005 case. Gilooly v. Mo. Dep’t of Health and Senior Servs., 421 F.3d 734 (8th Cir. 2005).

In Gilooly, the court had said a jury had to resolve whether the employer had retaliated against an employee who was terminated when the employer decided she had made a false harassment complaint. That decision, the latest decision explained, was made because the employer’s disbelief in the employee was founded solely on the statements of other employees and witnesses rather than on independently verifiable evidence or independent corroboration . . . from neutral non-parties. So, under this rule, "when an employer is presented with a 'he said, she said' set of facts involving two employees, and the employer chooses to disbelieve and discipline the employee who had engaged in protected opposition to unlawful activity, then the employee’s claim of retaliation must go to a jury."

What tipped the balance against sending the case to the jury was that the employer had "hard evidence" (the hand drawn map and the male's admission) that the male's complaint was false. It was also relevant that the independent review board upheld the employee's termination.

The holding in this case and the 2005 decision shows that it is probably a bad idea to impose discipline in any "he said, she said" situation. Rather, before an employer disciplines an employee for falsely reporting harassment, the employer is well-advised to have have compelling and independently verifiable evidence that the report is false.

Why Should You Acurately Document Performance Problems?

Today's decision of the court of appeals in Chicago points to the benefit of accurately documenting performance difficulities of employees, especially new employees.

As city in southern Illinois hired a jailer who, after some months on the job, got a mixed performance review. She did somethings OK, but the employer documented her slow work and lack of attention to detail were areas for improvement. She later complained about sexual harassment by a co-worker, her complaints were investigated, but her performance continued to lag. The employer called a meeting with her to discuss the performance. She brought a tape recorder to the meeting to surreptitiously record it, which under Illinois law constitutes a felony (unlike Tennessee law). The employer found out, had her house searched and the employee arrested when the tape was found.

The employee initially argued that she recorded the meeting to get evidence for her harassment suit and because the city admitted it had her arrested for illegally taping the meeting, the city effective admitted retaliating against her. The court turned this argument away as resting "upon a transparently overbroad view of the scope of the statute’s protection" because Title VII "does not grant the aggrieved employee a license to engage in dubious self-help tactics or workplace espionage in order to gather evidence of discrimination."

The employee next argued that the city criticized her performance after she complained, which showed, supposedly, bias against her. The court rejected this as well because the documented evidence was that the post-complaints performance criticisms were consistent with the critical evaluations made before she ever complained. That by itself, the court said, undermined any inference that her complaint and termination were related or that the employer's critiques of her performance were not genuine.

Employers hear the mantra of documentation alot and this case shows why. It is well understood that even valid complaints about an employee's performance can nevertheless be seen as pretextual if the employer ignores them until after the employee complains. In representing employers, we argue the employer's honest belief is what matters. It is hard to make this point effectively when the employer overlooks conduct that it would have otherwise had every right to criticize. It also mattered, in this case, that the employer did not "heap" more criticism on the employee after she complained. It did the smart thing and kept documenting the same performance difficulties noted before she complained.

Of course, this case also shows that an employer does not have to ignore, post-complaint misconduct at pain of being held liable for a retaliation claim. The employee's violation of the Illinois eavesdropping statute hadn't happened before her harassment complaint so, without evidence that this was dishonest, there was no reason the employer had to ignore this violation simply it arose after the employee complained.

Had the city employer not documented the performance issues before the employee complained about harassing conduct, the case might have come out differently. What may be also helpful to note is that the documentation was not elaborate. It simply listed the areas where the employee needed improvement. It takes something, in other words, but it doesn't take much.

Employers May Not Retaliate Against Employees Who Take FMLA Leave

This won't be earth-shattering. It will eliminate any doubts (that most employers didn't have in the first place).

A Dollar General store in Tennessee fired a computer programmer who had a serious health condition. The project on which she was working was behind schedule and missing deadlines. Shortly after she requested FMLA leave, Dollar General began imposing discipline on her. A few weeks later, she was fired. She said at trial that when she was terminated, a supervisor told her "because of your health, I don't think you can do the job." The jury found Dollar General had fired the employee because she took FMLA leave.

On appeal, Dollar General argued that the FMLA does not prohibit employers from terminating employees who have taken FMLA leave. Read literally, Dollar General was correct. The relevant statutory language simplys says that it is unlawful to discriminate against someone "for
for opposing any practice made unlawful by this subchapter." An individual who requests FMLA leave exercises her rights under the FMLA but doesn't necessarily do so by saying the employer is engaging in an "unlawful" practice. Of course, the DOL FMLA regulations say: "employers cannot use the taking of FMLA leave as a negative factor in employment actions" but regulations cannot increase the rights that Congress chose not to add.

The problem is, as the court recognized, that the right to take FMLA would be all but meaningless if an employer could use that leave against the employee. Courts have, moreover, been willing to imply a retaliation prohibition even where the statute does not expressly prohibit retaliation, as I explained in a prior post. It is hardly surprising, therefore, for the Sixth Circuit to read the FMLA as protecting employees because they had exercised FMLA rights. (Given these other decisions, I find some of the Sixth Circuit's reasoning unnecessary but I can't quibble with the results.)

The decision isn't going to come as a shock to most employers in Tennessee. Still, there is merit to reminding Tennessee employers that they should exercise caution and use some common sense when imposing discipline on employees who have taken FMLA leave.

The “new” but old retaliation claim

On May 27, 2008, the Supreme Court held that there is an implied right of action for retaliation in 42 U.S.C. 1981. CBOCS West Inc. v. Humphries, As to Tennessee employers, that had been the view of the Sixth Circuit for over 30 years (Winston v. Lear-Siegler, Inc., 558 F. 2d 1266, 1270 (CA6 1977), so, contrary to the splashy publicity, employers in this area will probably not see a major change (most attorneys who represent employees in race discrimination claims already add a 1981 claim when they file a Title VII lawsuit).

Two decisions from the Supreme Court have made lawsuits under section 1981 quirky from a procedural standpoint. The original statute, passed after the civil war, provided that all persons have the same right to make and enforce contracts as did white persons. After the supreme court narrowly interpreted the statute, Congress amended it in 1991 to broaden the kind of claims that could be brought.

Then, in 2004, the Supreme Court held lawsuits that could be brought because of the 1991 amendment could be filed within 4 years but claims that could have been brought under the statute before it was amended still borrowed state law which in Tennessee is 1 year. Jones v. R. R. Donnelley & Sons Co., 541 U. S. 369, 383 (2004). The reasoning behind these decisions is largely irrelevant to this topic so I'll omit it.

Two decsisions not terribly rooted in common sense mean that depending on the type of discrimination (i.e., hire v. fire) have very different time periods for filing a lawsuit. In Tennessee lawsuits over hiring decisions must be filed within 1 year while lawsuits over terminations have four years. So employers should keep all employment records, we advise, for at least four years.

What the recent CBOCS retaliation decision seems to foretell is that all retaliation claims (no matter the type) must be filed within 1 year (in Tennessee). The seven member majority reasons that in Sullivan v. Little Hunting Park, Inc., 396 U. S. 229 (1969), it had recognized a right to bring a retaliation claim based on a companion statute (section 1982) and that it had long interpreted sections 1981 and 1982 "similarly." Sullivan was obviously issued well before the 1991 Civil Rights Amendments Act. If, as the Court reasoned, a retaliation claim was originally recognized in 1969, that should mean that all retaliation claims under section 1981 borrow the state law statute of limitations (1 year in Tennessee) rather than the 4 year statute of limitations.

The CBOCS decision did not, however, specifically address the statute of limitation issue and different parts of the decision, if read out of context, could be read to support or deny the proposition that courts must borrow state statutes of limitations so it isn't yet clear which limitations period applies. Employers in Tennessee therefore should assume the 4 year period applies until the issue is resolved.

I should add that none of the above discussion affects lawsuits filed under Title VII, the "regular" employment discrimination statute.