Lou Michels and Rod Satterwhite are partners in the Labor & Employment group at McGuireWoods LLP. Both handle employment litigation on behalf of employers, and advise companies on employment issues regularly.

August 2007 - Posts

Inconsistency is a Hobgoblin ...

    Equal Pay Act cases are notoriously difficult for plaintiffs to win because of the stringent requirements for comparators.  Basically, a plaintiff in an EPA case needs to show that his employment situation is almost exactly the same as the comparative female who is making more money.  So it's nice to see an EPA case every now and then that breaks out how all these comparisons play in front of a jury.  And the lesson that comes out of these cases is that almost any inconsistency in terms of payroll practice can be used to support a jury's verdict on an EPA claim---so consistency should be the by-word to any employer with regard to wage practices.
 
    The case at issue, out of the 8th Circuit, deals with a relatively small amount of money, less than $5,000 in wage differential.  However, it was clear that the employee, an assistant manager for a chain of retail stores, was paid less than her male counterparts.  The employer's pay scales were wildy inconsistent, as a result of a series of job moves that caused different people to be paid different amounts of money at different times in the assistant manager position.  Some assistant managers were transferred from other stores where they had higher salaries and kept those salaries when they arrived at the plaintiff's store.  Some were allegedly performing as a store manager, rather than an assistant manager, and were paid more money, although there was still a pay disparity in the assistant manager compensation.  And some managers allegedly had different levels of experience, although the employer failed to put evidence on of these differences at trial.
 
    The Court's opinion points up the fact that employers must keep track of who was earning what throughout their workforce and not allow pay differentials except for articulable, legal reasons.  The employer in this case tried to justify its decisions post hoc.  These justifications simply couldn't override the alternative explanation for the wage differential -- namely that the company paid men more than women in this particular job.  There were good faith reasons for the company's actions, but none that applied across the board to the situations that developed at the plaintiff's store. Believe me, it's easier to fix these problems up front than to try to back in explanations at trial or in front of a judge at summary judgement.
 
   

Pharmaceutical Theology

    I wrote earlier on a case developing here in Illinois concerning the refusal of a pharmacist to dispense so-called "Plan B" contraceptives because doing so would conflict with his religious beliefs that the contraceptive acted by causing abortions.  The pharmacist in question, who was suspended from Wal-Mart, brought his claims of religious discrimination under Title VII and under the Illinois Health Care Right of Conscience Act, which prohibits disciplinary action against anyone for failure to participate in any form of healthcare service becuase of their conscience / moral beliefs.  Wal-Mart moved to dismiss the case, alleging that: 1) accomodating plaintiff would be more than a de minimis burden because the store had to comply with an Illinois regulatory requirement to dispense contraceptives or else, and 2)  the Right of Conscience Act didn't apply to pharmacists.
 
    The district court denied Wal-Mart's motion to dismiss both counts (Vandersand v. Wal-Mart Stores, Inc., No. 06-3293, C.D.Ill. Jul. 31, 2007), holding first that Wal-Mart hadn't shown that accommodating the plaintiff was unduly burdensome under the administrative requirement, and second, finding that the plaintiff is covered by the Right of Conscience Act because he is clearly engaged in the provision of healthcare services within the meaning of the state statute.
 
    At the motion to dismiss stage of civil litigation, the burden on the plaintiff is quite low in terms of stating a case.  However, the decision demonstrates the dilemma pharmacies confront here in Illinois.  The legislature passes a statute allowing pharmacists to exercise their conscience on the provision of healthcare services such as birth control, and then the governor, through an administrative avenue, penalizes pharmacies if their employees exercise their statutory rights.  Of course, Illinois is also the place where the Democratic governor and the Democratic legislature so far refuse to cooperate in putting a budget together for the state.  Further complicating the matter, there is another case working its way through federal court here that alleges the governor's administrative rule to be a violation of the First Amendment, and is preempted by Title VII.  Stay tuned for further details.

A Clarification on Right to Sue

One of the things that has always bothered me about the EEOC process in employment discrimination cases is its lack of precision on certain critical issues. This is particularly true with regard to one of the most significant time requirements contained in Title VII - the requirement that the plaintiff file a lawsuit in federal court within 90 days of receipt of a right to sue letter from the Commission.

For whatever reason, the Commission has never taken steps to ensure that there is a record of when it mailed a right to sue letter and when the plaintiff ultimately receives the letter. I've always believed that this is due, in part, to the Commission's hope that by introducing some uncertainty into the process, courts would be willing to err on the side of caution and allow cases to go forward when it appeared that the 90 day filing window had expired. Using a next-day carrier, or certified mail, both relatively simple and expedient, would be preferable to the current system, in which the right to sue letter is simply dropped into the US mail, without even a certificate showing when the document left the government's hands. And I'm aware of numerous cases where right to sue letters have languished in EEOC regional offices for days before being mailed, as well as the typical delays that manifest themselves in the US postal system.

Naturally, this haphazard process introduces all kinds of problems when a plaintiff files her case at 93-plus days following the date on the EEOC's letter. The Ninth Circuit, of all places, recently tried to establish "a coherent rule" in these types of cases, and determined that, absent some other evidence, a plaintiff will be presumed to have received a right to sue letter three days after the date of the right to sue letter. The decision is even more surprising because it had the effect of terminating a plaintiff's employment discrimination case because the plaintiff filed 97 days after the date of the EEOC's letter.

There's still no universal rule on presumption of receipt, but perhaps the EEOC will begin to address the issue now that the Ninth Circuit has spoken.

Houses of the Holy

The fastest way to find yourself on the losing end of a religious discrimination case is to actively practice your religion as part of your business operation.  Pretty obvious stuff, huh?  I don't think I've had to tell more than one client, ever, that actively running your business as a kind of religious enterprise is "a really bad idea." 
 
    So here's the case out of the Eighth Circuit that reinforces all of the above.  The plaintiff works for a home building company in Nebraska and is a member of the Assemblies of God Church, a relatively conservative Protestant denomination.  The owner of the business, John Smith, (I am not making this up) believes, among other things, in reincarnation and that trauma in past life explains behavior in this life.  In order to cleanse the collected residual negative energy from past life traumas, Mr. Smith would direct the employees to so-called Mind-Body Energy sessions.  These sessions, some of which were conducted in California (of course), required the building company employees to discuss Hindu, Buddhist, and Tibetan religious teachings.  The employees had to carry with them at all times a card containing the company's core values that included statements that everything in the universe is connected and uncorrected problems from past lives must be corrected in the present.  MBE coaches would come to the worksite to assist employees in releasing this negative energy, in some cases apparently by talking not only with each other, but with animals as well.  Mrs. Smith, who was the head of the Human Resources Department, kept records of these MBE sessions and appointments and the employees generally felt that attending the sessions was a job requirement. 
 
    The plaintiff complained to his supervisor that doing things like channeling dead people and talking to animals conflicted with his religious beliefs.  He was advised by his supervisor to schedule and then cancel his MBE sessions to give the impression that he "bought into" the whole spirituality gig.
   
    In its opinion, the Court gleefully recounts some of the other activities in this workplace, including Mr. Smith's negative energy discovery techniques, which involved asking someone "yes" or "no" questions while pushing down on the individual's extended arms.  If there was strong resistance, the answer to the question was "yes", while a weak response indicated a "no".  A similar test was apparently performed with fingers.  Mr. Smith indicated that he used this testing method to make business decisions and the Court described how the owner solved a drainage problem on one of his subdivisions by determining that one of his managers had an Ice Age relative who perished on the land.  Under Mr. Smith's theory, the manager was unknowingly defending the land on behalf of her ancestors through some sub-concious mechanism that caused the land to drain poorly.  Sounds vaguely like a plot line from Forbidden Planet.
 
    Against this backdrop, which makes The Office look pretty mainstream, the company hired a female associate to work under the plaintiff's supervision.  Shortly after her hire, the woman complained about the plaintiff's comments to her and requested reassignment.  Upon inquiry, the plaintiff admitted that he had "crossed the boundaries" by asking his female subordinate what her "freakiest" sexual encounter was, how long had she known her spouse before she had sex with him, how many sexual partners she had, and if she wore thong underwear.  The company terminated the plaintiff for poor leadership and lack of judgment, but did not mention sexual harassment in the termination.  The Court noted that the owner admitted using the muscle testing method in his decision to terminate plaintiff.
 
    The plaintiff sued for religious discrimination and retaliatory discharge.  Notwithstanding his admitted conduct, which would be enough to justify termination in this space-time continuum, the jury found for plaintiff on his religious discrimination claim.  However, the jury awarded plaintiff only $1 in nominal damages, obviously taking into account his fixation with, uh, non-work-related issues.  The trial court denied the employer's motion for judgment as a matter of law and awarded plaintiff all of his attorneys fees (reduced by 25%).  The Eighth Circuit affirmed the decision.
 
    The court found that there was enough evidence to support the jury's belief that the company's stated reasons for terminating plaintiff - his inappropriate comments to a female subordinate - were pretext because of the degree of religious influence and practice within the workplace.  The jury also apparently placed some credence in the plaintiff's claim that his subordinate was sexually provocative and initiated the inappropriate conversations, and that he may have been set up by her assignment to him for supervision.  In another gleeful footnote, the court noted that the female subordinate was later terminated after she removed her clothing at a golf outing and performed cartwheels, naked, on the golf course.  Personally, I think she was just using another method to get rid of that old negative energy.
 
    The message here is, well, if not clear, at least worth repeating.  Encouraging, and in some cases, requiring the open practice of religious beliefs within a workplace is a prescription for disaster.  Even in cases where the employer has a solid basis for a termination decision, it's easy for a jury to shift the focus to the religious practices (especially in this case) as a basis for the adverse employment action.