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Print articleThe Pessimist's Guide to Employment Litigation: Where It (May Be) Headed, and How to Head It Off
August, 2012 - Jennifer S. Greenlief, Eric E. Kinder
For employment lawyers, the elements of an employment discrimination
lawsuit are second nature: a plaintiff must belong to a protected class,
the employer must make an adverse employment decision, and the employer
must act based on the plaintiff’s protected status. And, for the most
part, employment lawyers have mastered the art of defending clients
against these claims and advising on strategies and policies to avoid
them altogether or minimize the likelihood of success.
Accordingly, plaintiffs and their attorneys have taken to using more
creative approaches. Since an ounce of prevention is worth a pound of
cure, in writing this article we put on our “plaintiff” hats and tried
to see the world through the eyes of someone who wants to bring a claim
but can’t find a well-established way to do so. Hopefully, this
out-of-body experience will allow our readers to plan for the future by
analyzing claims that now seem remote and far-fetched, but may not seem
so in the future.
Traditional discrimination claims require an affected employee to belong
to a protected class based on race, gender, veteran status, or a number
of other categories. Not so anymore. Over the past few years, the
number of claims pursued based on associational discrimination has
increased dramatically. In these claims, plaintiffs allege not that they
belong to a protected class but that they associate with a member of a
recognized protected class, and that their employers have discriminated
against them on that basis. In many ways, this is a counterpart to the
“reverse discrimination” claims that proliferated several years ago
under which a plaintiff who did not belong to a protected class could
claim that he or she suffered discrimination when an employer treated
members of a protected class more favorably than the plaintiff.
Importantly, limited federal statutory authority exists for
associational discrimination claims. The Americans with Disabilities Act
prohibits “excluding or otherwise denying equal jobs or benefits to a
qualified individual because of the known disability of an individual
with whom the qualified individual is known to have a relationship or
association.” 42 U.S.C. § 12112(b)(4). However, no corresponding
statutory framework exists for associational claims under Title VII or
the Age Discrimination in Employment Act, nor does comparable language
appear in most state discrimination statutes.
Nonetheless, the United Stated Supreme Court acknowledged the associational discrimination theory in retaliation cases in Thompson v. North American Stainless, LP,
131 S. Ct. 863 (2011). There, a man whose fiancée filed a charge of
discrimination with the U.S. Equal Employment Opportunity Commission
(EEOC) was later discharged by their common employer. He filed a lawsuit
claiming retaliatory discharge, arguing that the employer discharged
him in retaliation for his fiancée having filed an EEOC charge. The
district court rejected this theory and granted a summary judgment to
the employer.
The Supreme Court reversed the ruling. The Court found that the facts
stated by plaintiff Thompson, if true, constituted an unlawful Title VII
retaliation claim because Title VII prohibits an employer from taking
an action that “well might have dissuaded a reasonable worker from
making or supporting a charge” of discrimination, and a reasonable
worker might not engage in protected activity if he or she knew it could
affect the employment of a spouse or a significant other. The Court
chose not to define with specificity which relationships would qualify
for such protection, instead adopting a “zone of interests” test for the
courts to use when evaluating these claims.
Courts also have recognized these claims in discrimination cases. In the Second Circuit case of Holcomb v. Iona College,
521 F.3d 130 (2d Cir. 2008), a white basketball coach claimed that his
termination was motivated by the fact that his wife was black. In
reversing the district court’s grant of summary judgment to the college,
the court held that “an employer may violate Title VII if it takes
action against an employee because of the employee’s association with a
person of another race.” In so ruling, the court followed other circuits
and concluded that an employee who suffered discrimination due to his
association with a person of another race had actually suffered
discrimination because of his own race and the fact that it was
different from that of the other individual.
As courts begin to more widely recognize them, the limits of
associational discrimination claims are being stretched and tested by
plaintiffs’ attorneys nationwide. Fortunately for employers, federal
courts are setting some limits. For instance, a court in Tennessee
rejected a claim for associational discrimination based on an employee’s
allegation that he suffered discrimination because he worked for a
historically black university that paid the employees less than what
their counterparts at the University of Tennessee earned. Ferrell v. Johnson,
2011 WL 1125907 (E.D. Tenn. Mar. 30, 2011) (“To conclude, Title VII
prohibits racial discrimination; it does not mandate that all persons
performing equal work receive equal pay.”). Likewise, a district court
in Nevada granted a summary judgment against a black plaintiff who
claimed that he was discriminated against by his employer based on his
support for President Obama, who is biracial. Whitfield v. Trade Show Services, Ltd., 2012 WL 693569 (D. Nev. Mar. 1, 2012).
An employer typically rebuts a traditional discrimination claim, whether
asserted under Title VII or state law, by showing that a plaintiff’s
protected trait, such as age or race, was not the basis of the adverse
employment decision. Jury instructions then usually remind a jury that
an employer may terminate an employee for “a good reason, a bad reason,
or no reason at all.”
But what happens when an employer can no longer rely on “bad reason” or
“no reason” in defending against a discrimination claim? The
class-of-one claim has existed in the equal protection context for
years, protecting individuals from arbitrary and irrational decisions by
governmental agencies. The Supreme Court recently reaffirmed the
viability of this claim in Village of Willowbrook v. Olech, 528
U.S. 562 (2000). There, the Court reaffirmed that class-of-one claims
were appropriate when “a plaintiff alleges that she has been
intentionally treated differently from others similarly situated and
that there is no rational basis for the difference in treatment.”
To maintain a class-of-one equal protection action, a plaintiff must
show two things. First, a plaintiff must show that he or she was treated
differently than others who are similarly situated in all material
respects. Second, a plaintiff must show that the difference in treatment
did not have a rational basis or was irrational and abusive. See, e.g., Kansas Penn Gaming, LLC v. Collins, 656 F.3d 1210 (10th Cir. 2011).
Because a class-of-one claim is premised on the protections afforded by
the Fourteenth Amendment, courts have limited these claims to those
involving actions taken by governmental actors. And because those claims
essentially require the government to justify every action taken or not
taken under certain circumstances, courts have been particularly wary
to allow them to proceed in or extend to other contexts.
The very good news for employment lawyers is that so far courts have
explicitly prohibited these claims in the employment context. In Engquist v. Oregon Dept. of Agriculture,
553 U.S. 591 (2008), the Supreme Court limited these claims.
Recognizing the “crucial difference” between the government acting as a
lawmaker and acting to manage its own internal operations, the Court
held that class-of-one claims could not be brought to challenge
employment decisions due to the “subjective and individualized” nature
of those decisions, which involve “factors that are difficult to
articulate and quantify.” Id. Other courts have confirmed that
this extends categorically to public employment of all kinds, whether a
merit-based or a civil service position. See, e.g., Alford v. Consolidated Government of Columbus, Georgia, 438 F. App’x 837 (11th Cir. 2011).
For now, private employers have additional protection, because a
plaintiff can only allege this claim against a governmental actor and
courts have prohibited it from being applied in the employment context.
However, it is not difficult to see how the language and reasoning of
these decisions could bleed over, albeit informally, into the private
employment context. For example, employers are making “subjective and
individualized” employment decisions less frequently. Employers use
skills tests, objective promotion criteria, and other “blind” data, in
large part to avoid the implication of any discriminatory motives. When
an employer removes the subjectivity from employment decisions, however,
then the employer’s discretion shrinks considerably, opening a door to
challenge based on irrationality and bias. See, e.g., Umani v. Michigan Dept. of Corrections, 432
F. App’x 453 (6th Cir. 2011) (substantively analyzing a prisoner’s
employment claim based on the employer’s failure to act according to
well-established prison policy). Moreover, employers with employees who
need state licensing could open themselves up to lawsuits based on the
feedback given to those organizations regarding their employees. A
doctor in New Jersey has already tried this tactic, filing a lawsuit
against state authorities and claiming that the revocation of his
medical license was improperly induced by his ex-wife and others. Zahl v. New Jersey Dept. of Law and Public Safety Div. of Consumer Affairs, 428 F. App’x 205 (3d Cir. 2011). Other employers who participate in disciplinary hearings may also be at risk.
Tucked away in the provisions of President Obama’s proposed American
Jobs Act is a section that, if passed, would make it illegal to
discriminate against the unemployed when making hiring decisions. The
Senate version, introduced by Senator Harry Reid and titled the “Fair
Employment Opportunity Act of 2011,” S. 1549, is essentially identical
to the House bill, H.R. 12, introduced by Representative John Larson.
The two bills would make it unlawful for an employer to refuse to hire
an employee based on the employee’s status as unemployed. To date, those
bills have not become law, nor have the proposed state versions in
Connecticut, Michigan, Illinois, or Florida.
But the first laws aimed at providing protection for the unemployed have
already passed in two states. In June 2011, New Jersey became the first
state to pass a law that prohibited employers from publishing job
advertisements that overtly discriminate against the unemployed. See
N.J.S. 34:8B-1. New Jersey law now prohibits employers from “knowingly
or purposefully” publishing an advertisement for a job vacancy within
New Jersey that indicates that an employer will consider the potential
employee’s current employment status. It does, however, contain an
exception that allows an employer to consider only those applicants
currently employed by that same employer. And, although the law does
subject a company to a hefty fine for a violation, the law specifically
disavowed a private cause of action.
In March 2012, Oregon followed, with Governor John Kitzhaber signing the
“Fair Employment Opportunity Act,” S.B. 1548, into law. And in the same
month, the District of Columbia passed the Unemployed
Anti-Discrimination Act, Legisl. No. B19-0486 § 5(b), which is the first
law in the nation to explicitly prohibit discrimination based on a
person’s status as unemployed. While other states have yet to jump on
the bandwagon, protecting the unemployed evidently is gaining strong
support, with bills pending in several states, and other states are
expected to pass similar protective laws.
The strategies employers have already implemented in response to
traditional discrimination suits will do much to protect employers
should plaintiffs attack them under a new theory of discrimination like
those discussed above. However, a few tips from the above scenarios can
help strengthen these defenses.
First, attorneys should remind their clients to avoid learning
extraneous information about employees or potential employees during the
hiring, the promoting, or the terminating decision-making processes.
Also, creating a thorough documentation system for employment decisions
will help to avoid the specter of associational discrimination.
Second, attorneys can advise employers to review their policies to
ensure that they retain some discretion in employment and promotion
decisions. While objective criteria are good to prevent inadvertent
discrimination and ensure the hiring of strong employees, employment
policies should strongly convey the “at will” nature of the employment.
Finally, attorneys should counsel employers to make it a rule of thumb
never to include anything about a person’s status as employed or
unemployed in a job posting, and to not use that as a criterion for an
employment decision. Of course, an employer can and should still
evaluate why a potential hire is no longer employed, but the employer
needs to avoid simply jumping to conclusions. In addition to the legal
implications, an employer might just find a great employee that it would
have otherwise overlooked.
lawsuit are second nature: a plaintiff must belong to a protected class,
the employer must make an adverse employment decision, and the employer
must act based on the plaintiff’s protected status. And, for the most
part, employment lawyers have mastered the art of defending clients
against these claims and advising on strategies and policies to avoid
them altogether or minimize the likelihood of success.
Accordingly, plaintiffs and their attorneys have taken to using more
creative approaches. Since an ounce of prevention is worth a pound of
cure, in writing this article we put on our “plaintiff” hats and tried
to see the world through the eyes of someone who wants to bring a claim
but can’t find a well-established way to do so. Hopefully, this
out-of-body experience will allow our readers to plan for the future by
analyzing claims that now seem remote and far-fetched, but may not seem
so in the future.
Associational Discrimination
Traditional discrimination claims require an affected employee to belong
to a protected class based on race, gender, veteran status, or a number
of other categories. Not so anymore. Over the past few years, the
number of claims pursued based on associational discrimination has
increased dramatically. In these claims, plaintiffs allege not that they
belong to a protected class but that they associate with a member of a
recognized protected class, and that their employers have discriminated
against them on that basis. In many ways, this is a counterpart to the
“reverse discrimination” claims that proliferated several years ago
under which a plaintiff who did not belong to a protected class could
claim that he or she suffered discrimination when an employer treated
members of a protected class more favorably than the plaintiff.
Importantly, limited federal statutory authority exists for
associational discrimination claims. The Americans with Disabilities Act
prohibits “excluding or otherwise denying equal jobs or benefits to a
qualified individual because of the known disability of an individual
with whom the qualified individual is known to have a relationship or
association.” 42 U.S.C. § 12112(b)(4). However, no corresponding
statutory framework exists for associational claims under Title VII or
the Age Discrimination in Employment Act, nor does comparable language
appear in most state discrimination statutes.
Nonetheless, the United Stated Supreme Court acknowledged the associational discrimination theory in retaliation cases in Thompson v. North American Stainless, LP,
131 S. Ct. 863 (2011). There, a man whose fiancée filed a charge of
discrimination with the U.S. Equal Employment Opportunity Commission
(EEOC) was later discharged by their common employer. He filed a lawsuit
claiming retaliatory discharge, arguing that the employer discharged
him in retaliation for his fiancée having filed an EEOC charge. The
district court rejected this theory and granted a summary judgment to
the employer.
The Supreme Court reversed the ruling. The Court found that the facts
stated by plaintiff Thompson, if true, constituted an unlawful Title VII
retaliation claim because Title VII prohibits an employer from taking
an action that “well might have dissuaded a reasonable worker from
making or supporting a charge” of discrimination, and a reasonable
worker might not engage in protected activity if he or she knew it could
affect the employment of a spouse or a significant other. The Court
chose not to define with specificity which relationships would qualify
for such protection, instead adopting a “zone of interests” test for the
courts to use when evaluating these claims.
Courts also have recognized these claims in discrimination cases. In the Second Circuit case of Holcomb v. Iona College,
521 F.3d 130 (2d Cir. 2008), a white basketball coach claimed that his
termination was motivated by the fact that his wife was black. In
reversing the district court’s grant of summary judgment to the college,
the court held that “an employer may violate Title VII if it takes
action against an employee because of the employee’s association with a
person of another race.” In so ruling, the court followed other circuits
and concluded that an employee who suffered discrimination due to his
association with a person of another race had actually suffered
discrimination because of his own race and the fact that it was
different from that of the other individual.
As courts begin to more widely recognize them, the limits of
associational discrimination claims are being stretched and tested by
plaintiffs’ attorneys nationwide. Fortunately for employers, federal
courts are setting some limits. For instance, a court in Tennessee
rejected a claim for associational discrimination based on an employee’s
allegation that he suffered discrimination because he worked for a
historically black university that paid the employees less than what
their counterparts at the University of Tennessee earned. Ferrell v. Johnson,
2011 WL 1125907 (E.D. Tenn. Mar. 30, 2011) (“To conclude, Title VII
prohibits racial discrimination; it does not mandate that all persons
performing equal work receive equal pay.”). Likewise, a district court
in Nevada granted a summary judgment against a black plaintiff who
claimed that he was discriminated against by his employer based on his
support for President Obama, who is biracial. Whitfield v. Trade Show Services, Ltd., 2012 WL 693569 (D. Nev. Mar. 1, 2012).
Class-of-One Claims
An employer typically rebuts a traditional discrimination claim, whether
asserted under Title VII or state law, by showing that a plaintiff’s
protected trait, such as age or race, was not the basis of the adverse
employment decision. Jury instructions then usually remind a jury that
an employer may terminate an employee for “a good reason, a bad reason,
or no reason at all.”
But what happens when an employer can no longer rely on “bad reason” or
“no reason” in defending against a discrimination claim? The
class-of-one claim has existed in the equal protection context for
years, protecting individuals from arbitrary and irrational decisions by
governmental agencies. The Supreme Court recently reaffirmed the
viability of this claim in Village of Willowbrook v. Olech, 528
U.S. 562 (2000). There, the Court reaffirmed that class-of-one claims
were appropriate when “a plaintiff alleges that she has been
intentionally treated differently from others similarly situated and
that there is no rational basis for the difference in treatment.”
To maintain a class-of-one equal protection action, a plaintiff must
show two things. First, a plaintiff must show that he or she was treated
differently than others who are similarly situated in all material
respects. Second, a plaintiff must show that the difference in treatment
did not have a rational basis or was irrational and abusive. See, e.g., Kansas Penn Gaming, LLC v. Collins, 656 F.3d 1210 (10th Cir. 2011).
Because a class-of-one claim is premised on the protections afforded by
the Fourteenth Amendment, courts have limited these claims to those
involving actions taken by governmental actors. And because those claims
essentially require the government to justify every action taken or not
taken under certain circumstances, courts have been particularly wary
to allow them to proceed in or extend to other contexts.
The very good news for employment lawyers is that so far courts have
explicitly prohibited these claims in the employment context. In Engquist v. Oregon Dept. of Agriculture,
553 U.S. 591 (2008), the Supreme Court limited these claims.
Recognizing the “crucial difference” between the government acting as a
lawmaker and acting to manage its own internal operations, the Court
held that class-of-one claims could not be brought to challenge
employment decisions due to the “subjective and individualized” nature
of those decisions, which involve “factors that are difficult to
articulate and quantify.” Id. Other courts have confirmed that
this extends categorically to public employment of all kinds, whether a
merit-based or a civil service position. See, e.g., Alford v. Consolidated Government of Columbus, Georgia, 438 F. App’x 837 (11th Cir. 2011).
For now, private employers have additional protection, because a
plaintiff can only allege this claim against a governmental actor and
courts have prohibited it from being applied in the employment context.
However, it is not difficult to see how the language and reasoning of
these decisions could bleed over, albeit informally, into the private
employment context. For example, employers are making “subjective and
individualized” employment decisions less frequently. Employers use
skills tests, objective promotion criteria, and other “blind” data, in
large part to avoid the implication of any discriminatory motives. When
an employer removes the subjectivity from employment decisions, however,
then the employer’s discretion shrinks considerably, opening a door to
challenge based on irrationality and bias. See, e.g., Umani v. Michigan Dept. of Corrections, 432
F. App’x 453 (6th Cir. 2011) (substantively analyzing a prisoner’s
employment claim based on the employer’s failure to act according to
well-established prison policy). Moreover, employers with employees who
need state licensing could open themselves up to lawsuits based on the
feedback given to those organizations regarding their employees. A
doctor in New Jersey has already tried this tactic, filing a lawsuit
against state authorities and claiming that the revocation of his
medical license was improperly induced by his ex-wife and others. Zahl v. New Jersey Dept. of Law and Public Safety Div. of Consumer Affairs, 428 F. App’x 205 (3d Cir. 2011). Other employers who participate in disciplinary hearings may also be at risk.
Discrimination Based on Employment Status
Tucked away in the provisions of President Obama’s proposed American
Jobs Act is a section that, if passed, would make it illegal to
discriminate against the unemployed when making hiring decisions. The
Senate version, introduced by Senator Harry Reid and titled the “Fair
Employment Opportunity Act of 2011,” S. 1549, is essentially identical
to the House bill, H.R. 12, introduced by Representative John Larson.
The two bills would make it unlawful for an employer to refuse to hire
an employee based on the employee’s status as unemployed. To date, those
bills have not become law, nor have the proposed state versions in
Connecticut, Michigan, Illinois, or Florida.
But the first laws aimed at providing protection for the unemployed have
already passed in two states. In June 2011, New Jersey became the first
state to pass a law that prohibited employers from publishing job
advertisements that overtly discriminate against the unemployed. See
N.J.S. 34:8B-1. New Jersey law now prohibits employers from “knowingly
or purposefully” publishing an advertisement for a job vacancy within
New Jersey that indicates that an employer will consider the potential
employee’s current employment status. It does, however, contain an
exception that allows an employer to consider only those applicants
currently employed by that same employer. And, although the law does
subject a company to a hefty fine for a violation, the law specifically
disavowed a private cause of action.
In March 2012, Oregon followed, with Governor John Kitzhaber signing the
“Fair Employment Opportunity Act,” S.B. 1548, into law. And in the same
month, the District of Columbia passed the Unemployed
Anti-Discrimination Act, Legisl. No. B19-0486 § 5(b), which is the first
law in the nation to explicitly prohibit discrimination based on a
person’s status as unemployed. While other states have yet to jump on
the bandwagon, protecting the unemployed evidently is gaining strong
support, with bills pending in several states, and other states are
expected to pass similar protective laws.
So What’s an Employer to Do?
The strategies employers have already implemented in response to
traditional discrimination suits will do much to protect employers
should plaintiffs attack them under a new theory of discrimination like
those discussed above. However, a few tips from the above scenarios can
help strengthen these defenses.
First, attorneys should remind their clients to avoid learning
extraneous information about employees or potential employees during the
hiring, the promoting, or the terminating decision-making processes.
Also, creating a thorough documentation system for employment decisions
will help to avoid the specter of associational discrimination.
Second, attorneys can advise employers to review their policies to
ensure that they retain some discretion in employment and promotion
decisions. While objective criteria are good to prevent inadvertent
discrimination and ensure the hiring of strong employees, employment
policies should strongly convey the “at will” nature of the employment.
Finally, attorneys should counsel employers to make it a rule of thumb
never to include anything about a person’s status as employed or
unemployed in a job posting, and to not use that as a criterion for an
employment decision. Of course, an employer can and should still
evaluate why a potential hire is no longer employed, but the employer
needs to avoid simply jumping to conclusions. In addition to the legal
implications, an employer might just find a great employee that it would
have otherwise overlooked.
Footnotes: |
