This article is the start of a series where, once in a while and for no particular reason, I will focus on thought provoking and even profound statements (by others) about the law. Sometimes the quotations will be from literature, and sometimes they will be from legal writings, philosophical works, and from darn near anything else that makes us think about the nature of law and its relationship to society.

So let’s begin …

Grant Gilmore had one of the great legal minds of the twentieth century, taught law at Yale, and drafted article 9 of the Uniform Commercial Code. Especially the latter would not seem to suggest that he was a great writer, but Grant Gilmore was an extraordinarily eloquent guy. So here is the closing passage (page 111) of his book, The Ages of American Law (Yale 1977), and this is absolutely my favorite statement about law:

The better the society, the less law there will be. In Heaven there will be no law, and the lion will lie down with the lamb. The values of an unjust society will reflect themselves in an unjust law. The worse the society, the more law there will be. In Hell there will be nothing but law, and due process will be meticulously observed.

The better we are, the less law we need. In a perfect world, there will be no law. Grant Gilmore probably was thinking about James Madison’s famous statement in number 51 of The Federalist Papers:

But what is government itself, but the greatest of all reflections on human nature? If men were angels, no government would be necessary. If angels were to govern men, neither external nor internal controls on government would be necessary. In framing a government which is to be administered by men over men, the great difficulty lies in this: you must first enable the government to control the governed; and in the next place oblige it to control itself. A dependence on the people is, no doubt, the primary control on the government; but experience has taught mankind the necessity of auxiliary precautions.

If we were all angels, no law and no government would be necessary.

I understand that both of these flights of eloquence from Gilmore and Madison are exaggerations. We can all envision reasons why law and government would be necessary even in the best of societies. But their points still ring true. Law and government both exist in large part because of the imperfections in all of us. Indeed, constitutionalism is a reflection of the fact that our founders recognized the imperfections in mankind. Our founders wanted to empower the people to avoid tyranny, but they also distrusted the people and the power that would accumulate in even a democratic government.Read John Hart Ely’s Democracy and Distrust on the founders’ use of the constitution to restrain the abuses of the powerful. Our founders both aspired to democracy and distrusted democracy.

But the “move” gives me cheap excuse to use one of the sillier pictures I’ve ever seen (on the right). If only real (physical) moves were as easy as in this picture.

Anyway, I have moved my blog to its own URL, and here it is

• www.dcemploymentlawblog.com

Please update any links to this new URL. If you go to the old blog address (www.capuderfantasia.com/blog), you will get a notice that the blog has moved to its new address. This move to a new domain name devoted specifically to my blog should help with search engine optimization and other technical things.

I’ve also made some cosmetic changes to the blog, and I’ll continue to try to spruce it up so it looks good and makes it easy to find the stuff you’re looking for.

If you have any comments on the blog, or any suggestions, feel free to post comments on the bottom of the posts, or call or email me.

The Fifth Circuit directly held recently that hostile work environment claims are encompassed by age discrimination claims under the ADEA in Dediol v. Best Chevrolet, Inc., — F.3d — (5th Cir. September 12, 2011).

Age-Based Harassment

Milan Dediol was a 65 year old car salesman for Best Chevrolet. Dediol eventually quit (claiming constructive discharge) because of a series of age-biased insults and physical threats.  Dediol claimed the following remarks were made by his boss, Donald Clay, the used car sales manager:

• Dediol requested permission to take off from work for the next morning—July 4, 2007—to volunteer at a church event. Dediol received permission from Clay’s assistant manager, Tommy Melady (“Melady”), but Clay overruled Melady in derogatory terms. Dediol alleges that Clay told him, “You old mother******, you are not going over there tomorrow” and “if you go over there, [I’ll] fire your f*****g ass.”
• After his request to take off from work for the morning of July 4th, Clay never again referred to him by his given name, instead calling him names like “old mother******,” “old man,” and “pops.” Clay would employ these terms for Dediol up to a half-dozen times a day from on or around July 3, 2007, until the end of his employment. Dediol also claims that “[Clay] stole a couple of deals from me[,]” and directed them towards younger salespersons.
• Clay denied Dediol’s request for a transfer to sell new cars and stated, “Get your old f*****g ass over here. You are not going to work with new cars.” On many occasions, there were incidents of physical intimidation and/or violence between Clay and Dediol. According to Dediol, Clay would threaten him in a variety of ways, including threats that Clay was going to “kick [Dediol’s] ass.” On one occasion, Clay took off his shirt, and stated to Dediol, “You don’t know who you are talking to. See these scars. I was shot and was in jail.”
• Tensions escalated and reached a climax at an office meeting on August 29, 2007. During an increasingly volatile exchange, Clay proclaimed, “I am going to beat the ‘F’ out of you,” and “charged” toward Dediol in the presence of nine to ten employees.

Dediol eventually quit, claiming he was forced to quit by the discriminatory and threatening remarks. After Dediol filed suit, the trial judge granted Best Chevrolet’s motion for summary judgment, dismissing the case. Dediol appealed and the Fifth Circuit reversed, concluding that hostile work environment claims are available under the ADEA, and that Dediol presented sufficient evidence to proceed to trial.

Hostile Work Environment Applies to Age Claims Under ADEA

The Fifth Circuit noted that it had never before ruled that hostile work environment claims were available under the ADEA (for age discrimination), but concluded that they were:

We now hold that a plaintiff’s hostile work environment claim based on age discrimination under the ADEA may be advanced in this court. A plaintiff advances such a claim by establishing that (1) he was over the age of 40; (2) the employee was subjected to harassment, either through words or actions, based on age; (3) the nature of the harassment was such that it created an objectively intimidating, hostile, or offensive work environment; and (4) there exists some basis for liability on the part of the employer.

To prove the third element, that the harassment created an “objectively intimidating, hostile, or offensive work environment,” the Fifth Circuit explained :

A workplace environment is hostile when it is “permeated with discriminatory intimidation, ridicule, and insult, that is sufficiently pervasive to alter the conditions of the victim’s employment.” Alaniz v. Quezada, 591 F.3d 761, 771 (5th Cir. 2009). Moreover, the complained-of conduct must be both objectively and subjectively offensive. EEOC v. WC&M Enters., 496 F.3d 393, 399 (5th Cir. 2007). This means that not only must a plaintiff perceive the environment to be hostile, but it must appear hostile or abusive to a reasonable person. Id. To determine whether conduct is objectively offensive, the totality of the circumstances is considered, including: “(1) the frequency of the discriminatory conduct; (2) its severity; (3) whether it is physically threatening or humiliating, or merely an offensive utterance; and (4) whether it interferes with an employee’s work performance.”

Here is the full Fifth Circuit opinion in Dediol:

For other blog articles on the Dediol decision, see the The Employer Handbook, and The Texas Employment Law Blog.

What is the “Cat’s Paw” Scenario?

So, what the heck is the “cat’s paw” theory? Does it explain why my cat, pictured at the left, is staring so intently at you?

First, to define “cat’s paw” in a non-legal context, the Webster’s Online dictionary defines a “cat’s paw” as: “A person used by another to gain an end.” The term arises out of a fable in which a a shrewd monkey tricks a cat into pulling roasting chestnuts out of a fire—the cat gets its paw burned, and the monkey gets the chestnuts and scampers away unhurt.

Second, the “cat’s paw” translated into an employment setting goes something like this: the clever bigot in a workplace—Ralph, a white guy, playing the part of the shrewd monkey– wants to get rid of another employee, Bob, because Bob is African American. Ralph has no power to fire Bob. So Ralph trick’s Bob’s boss, Sally (white, playing the part of the tricked cat), into firing Bob. Ralph tells Sally that Bob embezzled $300,000. Sally, trusting Ralph, fires Bob. Ralph (the shrewd Monkey), Sally (the tricked Cat), and Bob, all work for Buy-N-Large Corporation (I got that name out of the Pixar movie, Wall-E).

So Bob sues Buy-N-Large for race discrimination. Let’s assume that Buy-N-Large proves conclusively that Sally was completely free of any sort of racial bias, but let’s also assume that the evidence is overwhelming that Ralph was a flaming racist.  And let’s also assume that only Sally had the firing authority over Bob, that she in fact made the termination decision, and that Ralph had no decision-making role in Bob’s termination.

Buy-N-Large then files a motion for summary judgment to dismiss Bob’s lawsuit, alleging that the employment discrimination laws require proof of discriminatory motive on the part of the company, Sally conclusively had not a discriminatory bone in her body, and therefore Buy-N-Large cannot be held liable under the employment discrimination laws.

So you’re the judge. Remember, Sally was free of even a hint of discriminatory intent, she made the decision to fire Bob, and she was the only one authorized by Buy-N-Large to fire Bob. Ralph is sitting there in full Klan regalia, had no authority to fire Bob, but Ralph tricked Sally into firing Bob over the false allegation of embezzlement. Again, to compare the roles to those in the fable: Ralph is the clever monkey who tricked Sally, the cat, into firing Bob (the object of Ralph’s trickery, the chestnuts in the fable).

Prior to the Supreme Court’s decision in Staub v. Proctor Hospital, the federal courts had been deeply divided on whether Buy-N-Large (sticking with my silly example) could be held liable for employment discrimination.  In Staub’s case (which dealt with discrimination based on military service, as opposed to the race discrimination in my example), the trial judge and jury found for the employee Staub, and then the Third Circuit Court of Appeals unanimously (3–0) ruled for the employer, holding that the employer could not be held liable under roughly the scenario I use in my example. Then the United States Supreme Court unanimously (8–0) ruled for Staub, the employee, holding that the employer could be held liable for discrimination under the “cat’s paw” scenario.

The Issues Under USERRA in Staub

To finally get back to what happened in the Staub case, Vincent Staub was  a member of the Army Reserve while working as an angiography technician for Proctor Hospital in Illinois. Staub contended that his immediate bosses were angry about his Army reserve service, in that supervisors had to schedule around Staub’s obligation to be on military reserve duty one weekend per month. USERRA prohibits discrimination against employees like Staub, who are in the military reserve.

Here are the management players in Staub’s case, and I point out their comparable figures in the “cat’s paw” fable, and I have summarized the relevant evidence of any discriminatory motive:

• Janice Mulally was Staub’s immediate supervisor. Mulally was the “clever monkey” in the fable, allegedly manipulating the “cat’s paw”, Buck. When Staub got fired, Mulally was not a “decision maker” in the termination. There was substantial evidence of discriminatory motive on the part of Mulally: (a) Mulally scheduled  Staub for additional shifts without notice so he could “pay back the department for everyone else having to bend over backwards to cover his schedule for the [military] reserves”; (b) Mulally told a co-worker that Staub’s military service had been a “strain on the department”; © Mulally asked the same co-worker for help to “get rid of him” [Staub].
• Michael Korenchuk was Mulally’s immediate supervisor. Korenchuk was another “clever monkey” in the fable, allegedly manipulating the “cat’s paw”, Buck. When Staub got fired, Korenchuk was not a “decision maker” in the termination. There was substantial evidence of discriminatory motive on the part of Korenchuk: Korenchuk told workers that Staub’s military service consisted of a “bunch of smoking and joking” that was a “waste of the taxpayers’ money”, and there was evidence that Korenchuk was aware that Mulally was “out to get” Staub.
• Linda Buck was Vice President of Human Resources for the hospital, Proctor Hospital. Buck was the innocent “cat’s paw” in the fable. When Staub got fired, Buck was the only “decision-maker”, but Buck fired Staub largely because of the allegations made by Mulally and Korenchuk. There was no evidence that Buck had any discriminatory motive against Staub.

We have a situation where there was substantial evidence that Staub’s immediate boss, Mulally, and Mulally’s immediate boss, Korenchuk, both had hostility toward Staub based on his military reserve service (“discriminatory animus”) and that Mulally was recruiting help to “get rid” of Staub (and there was evidence that Korenchuk knew of that plan or desire).

So here is a sequence of events that led to Staub’s termination:

• Mulally issued Staub a “corrective action” that accused Staub of violating a company policy that required Stub to stay in his work area. Staub contended in his later lawsuit that (a) there was no such policy, and (b) even if there was such a policy, Staub did not violate it.
• A co-worker of Staub complained about Staub’s “frequent unavailability” and “abruptness” to Buck and a different Vice President of Human Resources, McGowan. McGowan directed Buck and Korenchuk to create a plan of action to solve Staub’s “availability problem”.
• Before that plan of action was formulated, Korenchuk reported to Buck that Staub had left his desk without informing a supervisor, in violation of the prior “corrective action”. Staub contended the allegation was false, and that Staub had left a voice mail message for Korenchuk that Staub was leaving his desk.
• Buck then relied on Korenchuk’s allegation (about Staub leaving his desk without informing a supervisor), reviewed Staub’s personnel file, and fired Staub. Buck’s termination notice, relying on Korenchuk’s allegation, stated that Staub had violated the “corrective action” directive not to leave his desk without notifying a supervisor.

So this sequence of events has

1. Mulally (the “clever monkey”, with discriminatory intent) disciplining Staub with the “corrective action”,
2. Korenchuck (the second “clever monkey”, with evidence of discriminatory motive) making allegations that Staub violated the “corrective action” to Buck (the cat, with no evidence of discriminatory motive);
3. Buck, in reliance on Korenchuk’s allegation that Staub violated Mulally’s “correction action”, fired Staub.

USERRA and a “Motivating Factor” in the Employer’s Action

USERRA prohibits an employer from taking adverse action against an employee based on an employee’s membership in military service, such as being a member of the Army reserve. 38 U.S.C. § 4311(a).

An employer violates USERRA if an employee’s military service was a “motivating factor” in the “employer’s action” against the employee, unless the employer can prove that the adverse action “would have been taken in the absence of such membership. 38 U.S.C. § 4311(a).

Justice Scalia identified the difficult issues in looking at the “cat’s paw” scenario:

The central difficulty in this case is construing the phrase “motivating factor in the employer’s action.” When the company official who makes the decision to take an adverse employment action is personally acting out of hostility to the employee’s membership in or obligation to a uniformed service, a motivating factor obviously exists. The problem we confront arises when that official has no discriminatory animus but is influenced by previous company action that is the product of a like animus in some-one else.

Thus, to put it in terms of Staub’s case, if Mulally or Korenchuk had fired Staub, the Court’s would not have difficulty in concluding that Staub’s military service was a “motivating factor”  in the termination. But since the decision to terminate was made by Buck, the liability of the “company” has been less clear for the previous courts.

In examining the issue, Justice Scalia observed an important reality in corporate decision-making in employment decisions:

An employer’s authority to reward, punish, or dismiss is often allocated among multiple agents. The one who makes the ultimate decision does so on the basis of performance assessments by other supervisors.

Justice Scalia for the Court then set out the key holding in Staub’s case, that the employer may be held liable under some situations involving the broader “cat’s paw” scenario:

We therefore hold that if a supervisor performs an act motivated by antimilitary animus that is intended by the supervisor to cause an adverse employment action,3 and if that act is a proximate cause of the ultimate employment action, then the employer is liable under USERRA.

Another way to put this holding is that an employer may be liable for a termination where the actual decision-maker lacks any discriminatory motive, but where:

1. The innocent decision-maker relies upon information provided (or action taken) by another supervisor (“the bad supervisor”) of the plaintiff; and
2. The bad supervisor harbors discriminatory animus (ill will) against the plaintiff; and
3. The bad supervisor’s information provided to the innocent decision-maker is motivated by the bad supervisor’s discriminatory animus; and
4. The information provided or action taken by the bad supervisor is intended by the bad supervisor to cause an adverse employment decision against the plaintiff; and
5. The information provided or action taken by the bad supervisor is the proximate (actual, direct) cause of the adverse employment action against the plaintiff.

Justice Scalia for the Court made it clear that the fact that the innocent decision-maker applies independent judgment in reaching the decision does always not insulate the employer from liability:

We do not think that the ultimate decision maker’s exercise of judgment automatically renders the link to the supervisor’s bias “remote” or “purely contingent.” The decision-maker’s exercise of judgment is also a proximate cause of the employment decision, but it is common for injuries to have multiple proximate causes. .  . .  Nor can the ultimate decision maker’s judgment be deemed a superseding cause of the harm. A cause can be thought “superseding” only if it is a “cause of independent origin that was not foresee-able.” (citations omitted).

What is the Import of Staub v. Proctor Hospital?

Even though the decision in Staub pertained to a claim for military service-related discrimination under USERRA, language from the decision strongly suggests that the holding will also apply to claims for employment discrimination under Title VII of the Civil Rights Act of 1964, because of the similarity in the causation language between USERRA and Title VII:

The statute [USERRA] is very similar to Title VII, which prohibits employment discrimination “because of … race, color,religion, sex, or national origin” and states that such discrimination is established when one of those factors “was a motivating factor for any employment practice,even though other factors also motivated the practice.” 42 U. S. C. §§2000e–2(a), (m).

So a pretty clear operating assumption for employers should be that the holding in Staub on USERRA should apply to Title VII and any other federal employment discrimination statute that has causation language similar to USERRA.

Resources for Further Reading

A transcript of the oral argument on November 2, 2010 in the case is available at the Supreme Court’s web site, and you can also listen to the oral argument (with a synchronized transcript) at the Oyez site. And for extensive coverage of the case, including analysis, oral argument coverage, briefs, and a whole lot more, you can go to the page devoted to Staub v. Proctor Hospital at the always-wonderful SCOTUSBlog.

Here is the full opinion in Staub v. Proctor Hospital, which I uploaded to Scribd:

On January 24, 2011, Delegates Caputo, Fragale, Hatfield, Martin, and Moye introduced House Bill 2770, which is being referred to the Committee on Energy, Industry and Labor, Economic Development and Small Business then Finance. You can keep track of the progress of the bill by going to the Bill Status page and entering 2770 in the “Enter Bill Number” field. For information on the bill’s sponsors, or on any other members of the Senate, you can go to the House Members page and pick the member from a drop-down list. For those of you who are interested in finding out more about the legislative process, the Legislature has a “How a Bill Becomes Law” page.  The Legislature also has a very nice photo gallery of the Capitol Building.

According to an article in The State Journal, unions have been pressing this bill to give employees the right to take paid leave so they can take paid time off to tend to illnesses of the employees and the immediate family members of the employees. According to the note in House Bill 2770 itself, its purpose is to allow employees to use “earned leave with pay for an illness in an employee’s immediate family”.

Here is a walk-through of what the Flexible Leave Act (“the Act”), House Bill 2770, says:

1. 21-5G-2 (1): The Act covers all private (non-governmental) employers. However, it appears the House Energy, Industry and Labor, Economic Development and Small Business voted to amend the Act to limit it to employers with 50 or more employees.
2. 21-5G-3: The Act then applies its leave provisions only to an employer that “provides leave with pay under the terms of: (1) A collective bargaining agreement; or (2) an employment policy” (emphasis added).
3. 21-5G-2(4): “Leave with pay” is defined to mean “any time away from work for which an  employee receives compensation. Leave with pay includes sick time, vacation time and compensatory time”
4. So the Act deals only with “leave with pay” under a collective bargaining agreement or employment policy, and that leave with pay includes (non-exclusively) sick, vacation, and compensatory time. If the employer does not offer one of these types of leave with pay, then the Act does not apply.
5. 21-5G-4 then sets out the new right the employee has: The employee, where the employer offers leave with pay, “may use leave with pay for his or her illness or for an illness in the employee’s immediate family”.  Section 21-5G-2(3) defines “immediate family” as a “child, spouse or parent”. An employee who uses leave under the Act must “comply with the terms” of the employer’s collective bargaining agreement or the employer’s policy (21-5G-5©). Thus, the employee does not get any additional leave under the Act—the employee only has leave with pay the employer is already providing, and section 21-5G-5(a) makes it clear that the employee “may only use leave with pay under this article that has been earned” (emphasis added).
6. So the Act creates no new paid leave for employees. If the employer does not offer paid leave, then the employee has no rights under the Act. If the employer provides paid leave, the employee has the right to elect to use it for illness of the employee or the employee’s immediate family member. In essence, the Act gives the employee the right to shift the purpose of earned paid leave. As an example, if the employer offers paid vacation leave, the employee who has a sick child is entitled to use the vacation leave for the care of the child, and in taking the leave the employee must comply with the employer’s policies (21-5G-5©).
7. The Act provides the right to shift paid leave to situations involving illness, and the Act says it does not affect the unpaid leave afforded by the FMLA.  The FMLA entitles a qualifying employee to 12 weeks annually of unpaid leave.
8. 21-5G-6: The Act prohibits employers from discharging or taking other adverse action against the employee who exercises rights under the Act, or who files or participates in any  complaint under the Act.

Well that’s it. The Act does not give an employee any right to paid leave beyond what an employer is already voluntarily providing. But once an employer provides paid leave, the employee may shift the purpose from, for example, vacation time to sick time.

When I get any further news about the Flexible Leave Act (House Bill 2770), I’ll update you on this blog.

On January 28, 2011, Senators Palumbo and Klempa introduced Senate Bill 339, which is being referred to the Labor and Finance Committees. You can keep track of the progress of the bill by going to the Bill Status page and entering 339 in the “Enter Bill Number” field. For information on the bill’s sponsors, or on any other members of the Senate, you can go to the Senate Members page and pick the member from a drop-down list.

Senate Bill 339 would amend the WV Wage Payment and Collection Act, which deals in part with the obligation of an employer to issue a final paycheck to an employee within a certain period of time.  The Wage Payment and Collection Act currently sets two different deadlines, depending on whether the employee resigned or was discharged.

• Section 21–5-4(b): If an employee is discharged, the employer must pay the employee all earned wages within 72 hours after the discharge.
• Section 21–5-4©: if the employee resigns, the employer must pat the employee all earned wages by the next regular payday, either through “regular channels” or, if the employee requests, by mail. There is this additional variation where the employee resigns: if the employee provides “at least one pay period’s notice of intention to quit”, then the employer must pay the employee all earned wages “at the time of quitting” (which is the final day worked after giving notice).

Senate Bill 339 is simple in what it does: it eliminates the distinction between voluntary resignation and involuntary discharge, and would extend the discharge time period (now 72 hours) to the next regular payday. So under Senate Bill 339, employers would have to pay separated the employee all earned wages by the next regular payday, regardless of whether the employee resigned or was discharged.

Here is the marked up language of section 21–5-4(b) in Senate Bill 339 to show you exactly how the section will bee change, if the bill becomes law:

Whenever a person, firm or corporation discharges an employee, such the person, firm or corporation shall pay the employee’s wages in full within seventy-two hours no later than the next regular payday through the regular pay channels or by mail if requested by the employee.

Part of the significance of this proposed change is the potential penalty that applies if an employer fails to issue final pay checks to departing employee by the deadlines set out in the Wage Payment and Collection Act. Section 21–5-4(e) states that an employer that fails to meet one of these deadlines in issuing a final check is liable to the employee for “liquidated damages” in the additional amount (above and beyond the earned wages) for three times the unpaid amount. So if an employer owes a discharged employee final wages of $5,000, and the employer fails to pay that amount within 72 hours (or by the next regular payday under Senate Bill 339), then the employer owes the employee an additional $15,000, for a total of $20,000. The Act also allows the award of attorneys’ fees and expenses incurred by the employee in collecting the unpaid wages. Senate Bill 339 does not eliminate this liquidated damage liability, but it gives the employer the same deadline for issuing the final paycheck, regardless of whether the employee resigned or was discharged.

When there is any progress in the legislature on Senate Bill 339, I’ll update you on this blog.

Insurance companies have been urging the West Virginia Legislature to pass legislation to overturn the West Virginia Supreme Court’s decision in Michael v. Appalachian Heating, LLC, 701 S.E.2d 116 (June 11, 2010). In Michael, the West Virginia Supreme Court held that the West Virginia Human Rights Act prohibited discrimination by an insurance company in settling claims covered by an insurance policy.

The Michael Decision

Generally, the Human Rights Act prohibits discrimination (1) in the workplace, (2) in places of public accommodation (like hotels, shopping centers), and (3) in connection with transactions involving housing and real estate (like renting apartments and buying houses).

But at issue in Michael was section 5–11-9(7) of the Human Rights Act, which was not limited to those three categories of activity. Here is the relevant language in section 5–11-9(7)(A);

It shall be an unlawful discriminatory practice [based on race, religion, color, national origin, ancestry, sex, age, and disability] …

(7) For any person, employer, employment agency, labor organization, owner, real estate broker, real estate salesman or financial institution to:

(A) Engage in [1] any form of threats or reprisal, or to [2] engage in, or hire, or conspire with others to commit acts or activities of any nature, the purpose of which is to harass, degrade, embarrass or cause physical harm or economic loss or [3] to aid, abet, incite, compel or coerce any person to engage in any of the unlawful discriminatory practices defined in this section .…

In subpart (7)(A) above I have bracketed the three specific causes of action (legal theories) which the Supreme Court said are discernible in subpart (7)(A). I have also bolded the second cause of action, which was the key cause of action at issue in the Michael case.

In subpart 7 above, I have also bolded “person” because section 5–11-3(a) defines “person” as “one or more individuals, partnerships, associations, organizations, corporations, labor organizations, cooperatives, etc.” In other words, “persons” under the Act means real human beings and just about any type of business or labor organization, including a corporation. The insurance company (State Auto Insurance Company) in issue in Michael was a corporation, so it was a “person” covered by the Act.

So, in light of the fact that in the Michael case race discrimination was being alleged, I will restate here the key language in section 5–11-9(7)(A), with some explanatory information in brackets:

It shall be an unlawful discriminatory practice [based on race] …  For any person [including corporations] … to engage in, or hire, or conspire with others to commit acts or activities of any nature, the purpose of which is to harass, degrade, embarrass or cause physical harm or economic loss.…

The key thing for understanding the Michael holding is that there is nothing in 5–11-9(7)(A) which limits the prohibited discrimination to the settings of employment, public accommodations, and real estate/housing.

And that is what the West Virginia Supreme Court held in Michael–that this provision is not limited to those three area, and that this provision prohibits discrimination in a broad array of settings, including where an insurance company is settling a property damage claim.

In Michael, the plaintiffs rented an apartment. The owners of the apartment complex hired Appalachian Heating to fix some “climate control units” in the apartments. A fire destroyed the plaintiffs’ belongings in the apartment, and made the apartment temporarily uninhabitable. The plaintiffs claimed Appalachian Heating had done a bad job and caused the fired, and made a claim to the insurance company for Appalachian Heating. The insurance company for Appalachian Heating, State Auto Insurance Company, settled the claim for property damage made by plaintiffs. The plaintiffs then filed suit against the insurance company, alleging the insurance company discriminated against the plaintiffs because of their race, resulting in an unreasonably small payment for the plaintiffs’ property damage (their belongings in the apartment).

As a result of the Michael decision, insurance companies may be sued in settling claims if they allegedly discriminate on the basis of race or the other protected characteristics in the Human Rights Act.

The Pending Bill to Overturn the Michael Decision

The insurance industry has therefore lobbied to overturn the Michael decision, and there is new legislative activity in that direction.

House Bill 3073 was introduced by Delegates Perry, Hall, Hartman, Morgan, R. Phillips, and Skaff on February 9, 2011, and it has been referred to the Judiciary Committee. You can keep track of the status by going to the Bill Status page and typing 3073 at the field “Enter Bill Number”.

House Bill 3073, if it becomes law, will overturn Michael v. Appalachian Heating, LLC, 701 S.E.2d 116 (June 11, 2010), and will limit section 5–11-9(7)(A) of the West Virginia Supreme Court to employment, public accommodations, and housing. In other words, the provision cannot be used to sue insurance companies in connection with claims settlement.

Here is how House Bill 3073 would change the law, and the added language appears in underlining, and that underlined language is what is intended to overrule the Michael decision (and I have again bracketed the three causes of action in subpart (A)):

It shall be is an unlawful discriminatory practice …

(7) For any person, employer, employment agency, labor organization, owner, real estate broker, real estate salesman or financial institution to:

(A) Engage in [1] any form of threats or reprisal, or to [2] engage in, or hire, or conspire with others to commit acts or activities of any nature that relate to equal opportunity for employment, equal access to places of public accommodations, and equal opportunity in the sale, purchase, lease, rental, and financing of housing accommodations or real property, the purpose of which is to harass, degrade, embarrass or cause physical harm or economic loss or [3] to aid, abet, incite, compel or coerce any person to engage in any of the unlawful discriminatory practices defined in this section;

So for the second cause of action in subpart (A) the bill adds the underlined language that makes it clear that the cause of action is limited to employment, public accommodations, and housing. The insurance industry in settling claims is excluded, so the race discrimination claim pressed in Michael would not be viable under the amended language.

The bill is not yet law. It has been referred to the Judiciary Committee, and will have to wind its way through the legislative process.

I will soon be posting a more detailed article here on the Michael decision and will add it to my chart of employment decisions from the West Virginia Supreme Court.

Ms. Parks had worked for the hospital for 30 years when she was fired over a medical mistake involving herself and another much younger employee. The hospital fired Ms. Parks, but not the much younger employee.

The jury returned a verdict in favor of the plaintiff (Ms. Parks) for $450,000 for her economic loss and $450,000 for “other compensatory damages”, according to Ms. Simon’s blog article. Based on the limited information I have so far, it looks like the “other compensatory damages” was an award for emotional distress, The jury did not award punitive damages.

So the verdict totals $900,000, and Ms. Simon will file a request for attorneys’ fees’ fees and expenses. While it is not clear from the article so far, I suspect the case was asserted for age discrimination under Ohio’s Fair Employment Practices Act (and not the federal ADEA).

Here are the keys facts from Ms. Simon’s article, which in turn is based on an article in 19ActionNews.com (there is also an article by the Cleveland Plain Dealer about the verdict):

Parks’ lawsuit charged that her termination stemmed from a patient identification incident in July of 2008, involving Parks and a younger co-worker in the pre-admission testing department where they both worked. The mix-up occurred when two patients with the identical name appeared at the department on the same morning to get their blood drawn. UH claimed that Parks failed to follow the proper patient identification policy, but witnesses testified that the policy was not enforced in the department and not properly followed by the employee who checked the patient in that day, pulled the wrong medical chart, and passed it off to Parks. The mistake was discovered and corrected before the patient left the department and the blood work was for both patients was properly processed without any error. Neither patient was harmed. After Parks was fired, the department changed its procedures in the department to require proof of identification at the time of check in with a driver’s license.

Parks claimed that Steve Diltz, who became her supervisor five months prior to the incident, had singled her out and treated her differently than her younger coworkers since his assignment to her department. Evidence presented at trial showed that Diltz seized on the identification incident as a means to ensure that Parks was fired, and that his decision to unjustly fire her was supported without question by University Hospitals human resources department as well as Diltz’s manager without any independent investigation. The incident resulted in a patient complaint, but the testimony of the patient revealed that it was a third employee involved with the patient — the department nurse — not Parks, who had upset the patient on the day in question. The nurse was never disciplined.

I do a lot of litigation involving medical care employees in hospitals, and there are several key facts from Ms. Parks’ case that strike me as important and recurring in this kind of litigation:

1. Plaintiff alleges that a new supervisor comes on the scene and starts treating the nurse employee worse, based on some alleged discriminatory motive.
2. Plaintiff alleges that the new supervisor is picking on the plaintiff and is “out to get” the plaintiff, so the supervisor is allegedly looking for some type of ammunition to use to justify firing the plaintiff.
3. An actual or alleged medical mistake occurs. Sometimes an incident report is prepared, sometimes there are reports to regulatory authorities.
4. Plaintiff gets fired over the medical mistake.
5. Plaintiff alleges she was not at fault, someone else was at fault, or there is shared fault. Or plaintiff alleges there was no medical mistake at all.
6. Plaintiff alleges that the policy or procedure relating to the medical mistake was poorly communicated, with inadequate training by the hospital, so that disciplinary action is unreasonably harsh under the circumstances. Or plaintiff alleges there was no policy or procedure at all which was violated.
7. Plaintiff alleges that other employees have also violated the policy, either because of lack of information or general non-enforcement, and those other employees suffered no disciplinary action. Or plaintiff alleges that other employees handled the particular situation in the same way as plaintiff, to argue that there was no policy or procedure as the hospital alleged.
8. Plaintiff alleges that the investigation was biased or incomplete or both, and that the supervisor with the alleged bias controlled the investigation and conducted it in an unreasonable manner.
9. Plaintiff alleges that any review of the investigation by higher hospital officials was a superficial “rubber stamp”, lacking any real scrutiny of the validity of the investigation and disciplinary action.
10. Arguably confirming the plaintiff’s contention that the hospital’s policy or procedure was poorly or inconsistently applied, the hospital later modified or corrected the procedure. Plaintiff alleges that the modification of the policy or procedure confirms that she was not at fault.

Fact patterns including some or all of these items above pop up pretty frequently in medical industry employment litigation. Ms. Simon says she is going to write a more detailed summary of the case soon, and I look forward to reading more about it.

Dotson v. Pfizer: Adoption and the FMLA

The decision is Dotson v. Pfizer Inc., 558 F.3d 284 (2009), and involved allegations of retaliation stemming from leave taken for an international adoption from Russia.

The jury awarded $1,876 in damages on the FMLA interference claim and $331,429.25 on FMLA retaliation claim. The judge then awarded $333,305.25 in statutory liquidated damages, $375,000 in attorneys’ fees, and $14,264.88 in court costs. Both sides appealed. The Fourth Circuit rejected all aspects of the employer’s appeal, but found the trial court made a mistake in refusing to award the plaintiff pre-judgment interest.

Employees Don’t Have to Expressly Invoke the FMLA on Leave Requests

Part of the significance of the Dotson case is that the Fourth Circuit held that the employee, to invoke rights under the FMLA, need only tell the employer of the need for leave that is covered by the FMLA –the employee need not expressly invoke the FMLA as the basis or justification for the leave. The employer then has the duty to examine the situation and determine whether the requested leave implicates the employee’s FMLA rights. Here is an illustration of the 2 different possible requirements that were in issue in Dotson:

• Employee’s position on notice: Employee says: “Boss, I need some time off for the international adoption my wife and I are involved in. We have a meeting with the adoption agency tomorrow afternoon, and I’d like to take the afternoon off.” This is the only notice that the employee contended was necessary in order to invoke FMLA rights, and the Fourth Circuit agreed, based on a review of the case law and the applicable regulations. After the employee makes this request, the ball is in the employer’s court to figure out whether the leave is covered by the FMLA.
• Employer’s position on notice: Employee says: “Boss, I am requesting FMLA leave. I need some time off for the international adoption my wife and I are involved in. We have a meeting with the adoption agency tomorrow afternoon, and I’d like use my FMLA leave to take the afternoon off.” This is the notice the employer contended was necessary. The employer contended that, at least in the setting of adoption leave, the employee must specifically tell the employer that the employee wants to take FMLA leave. The Fourth Circuit rejected this argument, and rejected the need for the employee to specifically invoke the FMLA.

Part of the further significance of Dotson is that the principles of notice discussed above apply to a retaliation claim under the FMLA. Dotson asked for and was given leave for his adoption, and he got fired shortly after returning to the United State from Russia on his adoption. He filed suit and won on the contention that Pfizer fired him in retaliation for him taking FMLA leave. Pfizer contended: “hey, we can’t be liable for FMLA retaliation, because he never told us he was taking FMLA leave–he only said he wanted time off for the adoption.” The logic of that argument is, “we can’t be liable for retaliation where he didn’t specifically invoke the FMLA right”. The trial court and the Fourth Circuit both disagreed with the employer, and held that a retaliation claim may be viable even where the employee only said he wanted time off for the adoption–without specifically invoking the FMLA.

Lessons from Dotson v. Pfizer

So the request from the employee for covered time off (such as for an adoption), without expressly invoking the FMLA, raises two issues for employers:

• The employer must assess the request for time off and determine whether it invokes the rights under the FMLA.
• The employer must be aware of the fact that, once it determines that the request for time off is covered by the FMLA, any adverse action taken against the employee could give rise to a retaliation claim, even where the employee never mentioned the FMLA in connection with requesting the time off.