Under the Family Medical Leave Act (“FMLA”), employers are required to provide 12 weeks of unpaid leave to employees with certain family or medical issues. These issues include attending to serious health conditions that make the employee unable to work, or caring for newborns or family members.
A frequent dilemma that employers often face is what to do when an employee has exhausted all available FMLA leave and still cannot return to work. One employer, Gold Medal Bakery, currently finds itself in litigation surrounding this issue.
An employer isn’t immune from a discrimination claim when an employee quits instead of being fired. An employee who quits can still bring a “constructive discharge” claim, arguing that his working conditions were intolerable and that he had no other option but to quit.
This is a high bar to clear. For example, in the recent case of Coleman v. City of Irondale, the employer won summary judgment on a constructive discharge claim, despite racial slurs, inappropriate screensavers, and—yes—a pro wrestling photo.
White male discontent has been a major media talking point since the presidential election, and even long before. This talking point has made its way into the workplace, where tech firms are now being targeted for allegedly discriminating against white males in favor of women or non-white males.
Of course, discrimination lawsuits aren’t just for women or minorities; a white male can also sue for discrimination. A claim of discrimination by a white male based on gender or race is sometimes referred to as “reverse discrimination”—discrimination based on membership in a historically majority or advantaged group.
Federal employment law protects against a number of different types of discrimination, including treating employees differently because of age, gender, or race.
More and more often, employees bring discrimination claims based on harassment, rather than (or in addition to) claims based on employer decisions that appear to be discriminatory.
However, an employee can only bring a harassment claim under federal law if the employer has engaged in "discriminatory intimidation, ridicule, and insult" that was "sufficiently severe or pervasive to alter the conditions of the victim's employment and create an abusive working environment." See Harris v. Forklift Systems, Inc., 510 U.S. 17 (1993).
Federal law—specifically, Title VII of the Civil Rights Act of 1964—prohibits employers from discriminating against employees based on a number of protected characteristics, including sex, race, national origin, and religion.
One major open question, however, is whether Title VII prohibits employers from discriminating based on sexual orientation. For example, if a job candidate is openly gay, can the employee refuse to hire that person because of his sexual orientation without violating federal law?
The Supreme Court has never spoken on the issue.
When an employee brings a lawsuit alleging that his employer retaliated or discriminated against him, courts typically assess the claim by using a burden-shifting approach. Under this approach, after the employer offers a “legitimate, nondiscriminatory reason” for its actions, the employee has to come forward with evidence showing that the reason was pretextual.
The recent decision in Stephenson v. Potterfield Group LLC serves as an example of how an employee can meet this burden.
It is the norm for high-achieving employees to strive for and tout their successes. Recently, however, one person’s novel reaction to failure—his own termination—may show a future employer as much about his character as any of his considerable accomplishments.
Sree Sreenivasan was plucked from Columbia’s School of Journalism a few years ago to become the New York Metropolitan Museum of Art’s chief digital officer. According to Quartz, Mr. Sreenivasan brought the famed museum into the digital age through inventive social outreach efforts and a revamped, mobile-friendly website.
Employers with an eye to the regulatory horizon are aware that the Equal Employment Opportunity Commission (EEOC) has proposed expanding its annual Employer Information Report (EEO-1) to include data on employees’ pay.
The existing EEO-1 requires private employers with 100 or more employees to report the number of employees within 10 job categories by seven race and ethnicity categories, as well as by sex.
The proposed changes will further refine reporting to include employee counts as well as total hours worked by 12 pay bands.
The U.S. Equal Employment Opportunity Commission scored a victory last week against PMT Corp., a Minnesota-based medical device and equipment manufacturer. According to the commission’s complaint filed nearly two years ago, PMT Corp. engaged in systematic discriminatory hiring practices by refusing to hire women and individuals over the age of 40 in violation of Title VII and the Age Discrimination in Employment Act. According to Law 360, PMT agreed to settle the suit for $1.02 million payable to a class of applicants and a former PMT Human Resources professional who brought the company’s hiring practices to the EEOC’s attention.
When the 2015 college football season started, Steve Sarkisian was a rising star in the coaching firmament. He had led the University of Washington Huskies and his current team, the University of Southern California Trojans, to winning records and bowl games.
In late August, however, reports surfaced that Sarkisian had behaved inappropriately at a booster event, the Salute to Troy. And by mid-October, USC had terminated Sarkisian “for cause,” with athletic director Pat Haden explaining that Sarkisian’s use of alcohol had impaired his performance of his job.
This week, Sarkisian struck back, filing a 14-count complaint against USC in Los Angeles Superior Court.
Ellen Pao may not have won her gender discrimination case against Kleiner Perkins, but she may have inspired numerous women working in Silicon Valley who identified with her cause. According to Fortune, employment lawyers are seeing a heightened awareness among women that the workplace issues they face, and that Ms. Pao articulated in her case, are perhaps more widespread than not. This “Pao Effect” has Kay Lucas, a San Francisco-based employment law attorney, fielding twice as many calls each week from potential clients with workplace gender discrimination concerns. Kelly Dermody, a partner at Lieff Cabraser Heimann & Bernstein, has litigated gender discrimination cases for a decade, and told Fortune that her clients now have a heightened willingness to speak out. Lucas also said that companies are more inclined to settle instead of allowing information to become public, and as we observed with the Pao trial, highly publicized. Lucas noted that many of her clients’ complaints share similar themes involving exclusion from important meetings and denied access to the circles of influence. Yet, she said to Fortune, “these women are not particularly angry; they’re ambitious. They’re not victims; they want to be participants.”
A quick search of legal news gives this “Pao Effect” additional credibility. According to Law 360, Heather McCloskey recently sued Paymentwall, Inc. for sexual harassment, discrimination, retaliation and failure to take reasonable steps to prevent harassment and discrimination. Ms. McCloskey alleged that executive Benoit Boisset routinely harassed her, calling attention to her physical appearance in a demeaning manner. As she became more vocal in her objections, Boisset used expletives when referring to her, and ultimately terminated her employment. McCloskey also described the workplace environment as young, predominantly male and lacking any formalized set of rules or policies. Kelly Dermody cited these kinds of workplace dynamics as partially to blame for the volume of complaints arising from Silicon Valley. She opined to Fortune that many tech companies take off “really quickly without a lot of attention to human resources.” Consequently, “you have a lot of young managers who make young managers’ mistakes,” which might encompass many of the alleged missteps in the Paymentwall case.
The ongoing trial in Ellen Pao v. Kleiner Perkins Caufield and Byers has made headline news across the country. It’s being covered by the Wall Street Journal and USA Today, among other national publications. Those interested in following the trial can monitor the #ellenpao hashtag on Twitter, or watch liveblogs from Re/code or the San Jose Mercury-News.
Why is the trial so newsworthy? As we reported here, Pao claims that Kleiner Perkins, a prominent Silicon Valley venture capital firm, discriminated against her because of her gender and then retaliated because she complained. She claims that she was not promoted to a plum senior partner position because she was a woman, and that the firm fired her because she complained and later sued it. Her story involves sex, boorish behavior, and office intrigue that ranges from the mundane to the highly dramatic.
With that introduction, here are some -- of many -- takeaways for employers from what has transpired thus far:
Craig Watts, a chicken farmer from North Carolina, recently brought a whistleblower complaint against Perdue, claiming that the poultry seller retaliated against him for bringing certain animal welfare claims to light. Mr. Watts owns the farm on which the chickens are raised, but, according to the Government Accountability Project, the terms and conditions of the farm operations are strictly governed by the poultry giant. The Food Integrity Campaign (a program operated by the Government Accountability Project) filed the action on behalf of Mr. Watts, defending his right to speak out about the conditions on the farm, which Watts claims run far “afowl” of Perdue’s marketing claims of “cage-free” and “humanely-raised” chickens. After publicizing the conditions on his farm, Watts was placed on a performance improvement plan and is routinely subjected to surprise audits of his farm.
A former executive at L.A.’s Fashion Institute of Design and Merchandising is seeing red over the school’s termination of her employment, which allegedly came after she demanded more diverse branding in the school’s publications. Tamar Rosenthal filed a civil rights complaint in Los Angeles Superior Court alleging that the school, seemingly interested only in shades of white, opposed her attempts to showcase student diversity on the website and explicitly advised her not to showcase gay, black or non-white students in any school publications. According to My News LA, the complaint further alleged that Ms. Rosenthal’s supervisors created an “ultra-conservative, anti-Arab and anti-Muslim political atmosphere in the school’s front office.”
Yesterday, the Supreme Court heard argument in the religious discrimination case of EEOC v. Abercrombie & Fitch Stores, Inc., which made our list as one of our five issues to watch for 2015. The case arises under Title VII, the federal law that makes it illegal for an employer “to discriminate against any individual with respect to h[er] compensation, terms, conditions, or privileges of employment, because of such individual’s . . . religion.” The EEOC alleges that Abercrombie, purveyor of “authentic American clothing,” discriminated against Samantha Elauf on religious grounds. The company refused to hire Elauf because she wore a headscarf, or hijab, to her job interview, and the company’s “Look Policy” prohibited employees from wearing “caps.”
In earlier depositions in the case, Elauf’s interviewer at Abercrombie testified that she “assumed that [Elauf] was Muslim,” and “figured that was the religious reason why she wore her head scarf.” The interviewer said that she went to her district manager to discuss the headscarf issue, and told him that “[Elauf] wears the head scarf for religious reasons, I believe.” The interviewer testified that the district manager then told her not to hire Elauf because of the headscarf and said, “[S]omeone can come in and paint themselves green and say they were doing it for religious reasons, and we can’t hire them.” As a result, the interviewer lowered Elauf’s “appearance” score on her evaluation, and Elauf didn’t get the job.
Despite this testimony, the Tenth Circuit still entered summary judgment for Abercrombie, holding that the EEOC’s discrimination claim could not proceed to trial because Elauf “never informed Abercrombie prior to its hiring decision that she wore her headscarf or ‘hijab’ for religious reasons and that she needed an accommodation for that practice, due to a conflict between the practice and Abercrombie’s clothing policy.”
The fact that the Tenth Circuit granted summary judgment, even though the interviewer admitted that she assumed that Elauf wore the scarf for religious reasons, helps explain the concerns, and potential solutions, that the Justices raised in yesterday’s argument.
Silicon Valley is buzzing about the trial in Ellen Pao v. Kleiner Perkins Caufield and Byers LLP, which got underway on Tuesday. According to USA Today, a UC-Berkeley professor says that you “can’t be within a stone’s throw of the Valley without hearing” about the case.
The cast of characters (described here by the San Francisco Business Times) includes a number of heavy hitters, including Pao herself. Pao, a graduate of Princeton, Harvard Law, and Harvard Business School, is now the CEO of Reddit. Kleiner Perkins is a well-known venture capital firm in Menlo Park, a city that has been described as the “center of the venture capital universe.”
Pao’s allegations are explosive. She contends that she had a brief affair with a married junior partner who continued to harass her after she broke off their relationship. Her claims about the firm go deeper than just this harassment; she contends that the firm had an overarching culture of discrimination against women, culminating in her dismissal in October 2012.
Netflix, the internet media giant, sued its former vice president of IT Operations, Mike Kail, in California Superior Court, claiming that he “streamed” kickbacks from vendors and funneled them into his personal consulting company. According to the complaint, Kail—who is currently the CIO of Yahoo—exercised broad latitude in both vendor selection and payment. Netflix alleges that he took in kickbacks about 12-15% of the $3.7 million that Netflix paid in monthly fees to two IT service providers, VistaraIT Inc. and NetEnrich Inc. According to the Wall Street Journal, one line in particular from the complaint piqued experts’ interest: “Kail was a trusted, senior-level employee, with authority to enter into appropriate contracts and approve appropriate invoices.” According to Christopher McClean, an analyst at Forrester Research Inc., this suggests Netflix allowed Kail too much freedom. McClean opined that when individuals are empowered to both choose a vendor and then approve payment, corporate malfeasance can follow. This is particularly important in the field of information technology, where tech companies vie for business in an ever-competitive market by lavishing incentives on CIOs. Companies that do not incorporate an audit function into vendor selection and payment should consider revisiting their policies going forward.
We recently discussed the hefty $185 million judgment against AutoZone in favor of a former store manager who alleged discrimination and retaliatory discharge following her pregnancy. While this case arose in California, it appears the auto parts retailer is zoned for another similarly-themed legal showdown, this time across the country in West Virginia. In the recent complaint, the plaintiff, Cindy DeLong, claimed that she was placed on a 30-day performance improvement plan for hiring too many women in the stores she managed. She was ultimately fired before the 30 days expired. As you may recall, in the California case, plaintiff Rosario Juarez claimed AutoZone enforced a “glass ceiling” for its female employees, denying them opportunities for promotion. It seems Ms. DeLong managed to chip away at the ceiling as a district manager. But, according to Courthouse News, she now alleges that her practice of hiring women rendered her “not a good fit for the company.”
On Monday, AutoZone found itself on the wrong end of a $185 million verdict in favor of a former store manager, Rosario Juarez. Yes, you read that right. $185 million. This stunning verdict appears to have been the result of Juarez’s allegations of discrimination and retaliatory discharge, combined with an insider turned witness who provided extremely damaging testimony against the auto parts retailer.
In her complaint, Juarez alleged that AutoZone had a “glass ceiling” for women employees, which it kept in place through a hidden promotion process where open positions were not posted. According to Juarez, she succeeded in cracking the glass ceiling, securing a store manager position, but when she became pregnant, she was treated differently by her district manager. After giving birth, she complained about the unfair treatment and was soon demoted by the manager, who told her that she could not be a mother and handle her job. Later, she was terminated as the result of a loss prevention inquiry, in which she refused to participate in a “Q&A” statement about a theft at the store. Juarez alleged that the loss prevention department’s request for a statement was a pretext to fire her.
We’ve spent a lot of time on this blog discussing allegations of pregnancy discrimination like these (see, for example, here, here and here). The short of it is that a company can’t treat pregnant women, or women who have given birth, differently than it treats other employees. But we’ve never covered a verdict for pregnancy discrimination that looked more like a Powerball win than a litigation result.
We at Suits by Suits are so excited by American Apparel’s dispute with its recently-fired CEO and founder Dov Charney that we can barely keep our shirts on. After all, the dispute between the clothing manufacturer and its controversial former leader is bursting at the seams with takeaway points for feuding companies and C-suite employees (and those wanting to avoid having feuds). For example, as we described in an earlier post, the dispute illustrates that terminating a key company officer may jeopardize company financing. The dispute also presents the question: can a company like American Apparel, which knew that Charney was apparently known for not being able to keep his pants on, decrease its exposure to the inevitable sexual harassment lawsuit by having all of its employees acknowledge in writing that the company’s workplace is sexually charged? It depends.
We cover a broad range of issues that arise in employment disputes. Occasionally, we also spotlight other topics of relevant legal interest, ranging from health care to white-collar defense to sports, just to keep things interesting.
Led by Jason Knott and Andrew Goldfarb, and featuring attorneys with deep knowledge and expertise in their fields, Suits by Suits seeks to engage its readers on these relevant and often complicated topics. Comments and special requests are welcome and invited. Before reading, please view the disclaimer.