Iowa Employment Law Blog

U.S. District Court in Iowa Imposes $4.5 Million Sanction against EEOC

Patrick Smith — Thu, 18 Feb 2010 13:48:49 -0600

On February 9, 2010, U.S. District Judge Linda Reade ordered the Equal Employment Opportunity Commission (link courtesy of Ross Runkel) to pay Cedar Rapids based CRST Van Expedited $4.5 million in attorney’s fees and costs it incurred to defend itself against a meritless sexual harassment lawsuit.

The action started in 2005 when a CRST employee filed an EEOC charge alleging sexual harassment. The Agency never completed its investigation, and the employee herself did not pursue an action in court. Nonetheless, in 2007, the EEOC filed suit in the Northern District of Iowa on behalf of the woman and other unspecified female employees. Ultimately, the EEOC identified 270 women it claimed were victims of sexual harassment at the company.

The court dismissed or granted summary judgment to CRST on all but 67 of the women involved, because of a lack of evidence to support the claims. Later, the court dismissed the claims involving the remaining 67 women. The reason for the dismissals: the court found the EEOC conducted no investigation of the circumstances involving the 67 before filing the suit on their behalf, and did not make a finding there was reasonable cause to believe discrimination occurred. The EEOC’s failure to investigate, the court concluded, prejudiced CRST because it denied them the opportunity to conciliate and foreclosed the possibility that some of the claims might be settled before the necessity of defending a federal lawsuit. According to Judge Reade, "the EEOC's actions in pursuing this lawsuit were unreasonable, contrary to the procedure outlined by Title VII, and imposed an unecessary burden on CRST and the court." She characterized the EEOC's litigation strategy as "sue first, ask questions later."

Judge Reade’s order was striking not only in the amount of the award but in the fact that it sanctioned a federal agency because of the burden it imposed on a private company to defend itself against claims that did not really exist. Any company that has been the target of an EEOC lawsuit is likely to cheer Judge Reade’s attorney fee award. It seems only fair that the Agency should be subject to the same standards as a private litigant when brining a lawsuit; that is, it should be required to have a good faith belief, based upon a reasonable investigation, that its claims are supported by the facts and law.

Not everyone agrees, however, that the sanction imposed is a good thing. Marcia McCormick at Workplace Prof Blog wonders what alternatives were available to the EEOC. She seems to take the position that the EEOC should have the right to litigate harassment claims of persons who never filed a charge and whose circumstances were never investigated.

Jon Hyman at Ohio Employer’s Law Blog cheers the result, but warns that this sanction could be a mixed blessing for employers. He believes it will cause the EEOC to conduct more in-depth investigations of its claims, which could in the end impose more administrative burdens than is commonly the case now.

A very interesting case that likely is not yet over. The EEOC believes the decision was wrong and intends to appeal.

Iowa WARN Act Passes Iowa House

Patrick Smith — Thu, 28 Jan 2010 16:13:30 -0600

On January 27, the Iowa House passed HF 681, known as the "Iowa Worker Adjustment Retraining and Notification Act".

There is already a Federal WARN Act, which requires most employers with 100 or more employees to provide at least 60 days notice to their employees of a mass layoff or plant shutdown. Failure to file the WARN Act requirements can result in liability for back pay and benefits for each affected employee, for the time of the violation, up to 60 days.

The proposed Iowa law is more stringent than the federal law is some respects, but more lenient in others. It is more stringent in that is applies to employers with 25 or more employees. It is more lenient, however, in that is requires only 30 days notice of a mass layoff or shutdown. In addition, the penalties under the Iowa law are limited to $100 per day for each day of the violation. There is no private right of action; the law is enforced by the Department of Work Force Development.

The bill has not passed the Iowa Senate, nor has the Governor stated publicly whether he will sign it. Organized labor is strongly in favor of the bill. However, given the difficult economic conditions that still exist in the State, and the Governor up for a tough re-election fight, it remains uncertain whether this bill will become law. We will keep you posted.

Eighth Circuit Issues Significant Ruling on Sex Stereotyping and Gender Discrimination

Patrick Smith — Wed, 27 Jan 2010 10:47:11 -0600

On January 21, the U.S. Court of Appeals for the Eighth Circuit issued a decision that is likely to expand the frontiers of sex discrimination litigation in this circuit (which covers Arkansas, Missouri, Iowa, Minnesota, Nebraska, and North and South Dakota). In Lewis v. Heartland Inns of America, a female plaintiff who had masculine characteristics and mannerisms was terminated from her job as a motel night auditor. The trial court granted summary judgment to the employer on the plaintiff's sex discrimination claim because the plaintiff presented no evidence she was treated less favorably than similarly situated males, or that the employer was biased against women in favor of men. The court of appeals reversed, and held that a decision maker's remarks to the effect that female employees should be "pretty" and feminine was sufficient evidence to generate a jury question whether the employer was motivated by unlawful sex discrimination, even in the absence of evidence concerning the treatment of male employees.

With this decision, the Eighth Circuit joined the First, Second, Sixth, and Ninth Circuits in holding that an employer’s expectation that an employee should act consistent with a preferred sex stereotype may constitute sex discrimination.

The plaintiff in Lewis worked part time at the front desk at various locations of the Heartland Inn. She generally had worked the overnight shift. For two years Lewis’ managers thought she was a good employee and requested she receive pay raises. One of her managers testified that Lewis “made a good impression” , and another that she “did her job well.” There was a record of at least one customer comment that praised Lewis. In December 2006, Lewis’ manager requested permission from Heartland’s Director of Operations to offer Lewis a full time night auditor position on the 3 p.m. to 11 p.m. shift. The Director of Operations, who had never seen Lewis, granted the permission.

After seeing Lewis, the Director of Operations had second thoughts. She told Lewis’ manager that Lewis was not a “good fit” for the front desk. She apparently lacked the “Midwestern girl look”. The Director of Operations, who was also female, had been heard to boast about the appearance of women staff members, and indicated that Heartland staff should be “pretty.”

Lewis herself described her appearance as “slightly more masculine.” She preferred to wear loose fitting clothing, including men’s button down shirts and slacks. She avoided makeup and wore her hair short. Lewis has been mistaken for a male, and referred to as “tomboyish”.

The Director of Operations ordered Lewis’ manager to move her back to the overnight shift. About the same time, a new policy was instituted that required any employee hired for a front desk position to go through a second interview. Heartland purchased video equipment so that the Director of Operations could view a candidate before extending an offer. Even though Lewis had been working the 3-11 shift for a month, the Director of Operations insisted she go through a second interview. When Lewis protested and said it was illegal, she was terminated.

The district court granted summary judgment to Heartland because Lewis produced no evidence that she was treated differently than similarly situated male employees. The Court of Appeals held, however, that the district court was wrong to require the plaintiff to present evidence concerning male employees, noting that “comparative evidences is certainly not the exclusive means by which a plaintiff may establish an inference of discrimination.”

The critical issue, the court reasoned, is “whether members of one sex are exposed to disadvantageous terms or conditions of employment to which members of the other sex are not exposed.” According to the court, the statements that front desk personnel should be “pretty”, and that Lewis lacked the “Midwestern girl look” was sufficient to generate a jury question whether her gender played a role in the decision. In other words, it was not necessary to offer evidence that male employees were subject to a different standard because a reasonable fact finder could find that the terms by their nature apply only to women.

While it is not clear the Lewis decision will result in a flood of new lawsuits, it nonetheless expands the boundaries for potential sex discrimination claims in a way that will make it more difficult for employers to defend. It is important to note that stereotypical attitudes concerning how women should behave was already relevant in such cases. However, a plaintiff still had to show that, as a result of such attitudes, female employees were at a disadvantage compared to males. Now, it seems, a female employee can prove unlawful sex discrimination by showing she was disadvantaged compared to other females who acted more feminine than she. Likewise, a male employee can simply show that male employees who were more masculine were favored over those who exhibited feminine characteristics. The difficulty is that, unlike gender itself, which is an objectively verifiable fact, many notions of femininity and masculinity are inherently subjective.

The Lewis case is one of those decisions where bad facts make bad law. Based upon the record presented in the court's opinion, there is little doubt Ms. Lewis was treated poorly for reasons unrelated to her performance. Her appearance certainly put her at a disadvantage compared to other female employees. But there simply was no basis to conclude she was at a disadvantage compared to similarly situated males.

For other perspectives on this case, see the following:

"Of Slacks and Sex Discrimination", in Work Matters Blog.

"Eighth Circuit Issues Interesting Appearance/Sex Stereotyping Case", in Workplace Prof Blog.

U of Iowa Study Shows Race Not an Important Factor in Hiring NFL Head Coaches

Patrick Smith — Tue, 12 Jan 2010 20:33:35 -0600

A recent study by University of Iowa economist John Solow found little evidence of racial discrimination in head coach hiring by National Football League Teams. In 2003, the NFL instituted the "Rooney Rule" to try and increase the number of racial minorities who served as head coaches. The rule required teams to interview minority candidates for head coaching and senior football operations opportunities. Despite the league's effort to increase diversity in the head coaching ranks, some are critical that six years after its implementation, only six of the 32 NFL teams have minority coaches. Seventy five percent of NFL players are minorities.

Nonetheless, Dr. Solow concluded that race is not an important factor in promotion decisions for head coaches. Solow studied head coach hiring from 1970-2008, and noted that most vacancies were filled from the ranks of offensive or defensive coordinator positions. He found that success as a coordinator was the most important factor in moving to the head coaching ranks. According to Solow, the most effective means for the NFL to increase the number of minority head coaches would be to increase the number of minorities in the lower level coaching positions from which head coaches are ultimately drawn. Solow contends that applying the Rooney Rule to these other coaching positions would be the best way to increase the number of minorities in the head coaching ranks.

"If the league introduced African-American coaches into the front of the pipeline instead of at the end, more of those coaches would have the experience teams are looking for and be more likely to be hired as head coaches," Solow said.

Solow's statement could be applied to virtually any workplace. Some might call it simplistic, but it makes sense that providing people opportunities at the entry level is key to developing diversity throughout an organization. Despite those who criticize the NFL because of the low number of minority head coaches, there are few organizations today as color blind as professional sports leagues. There is virtually no other industry where minorities have been as successful. If other workplaces were as color blind as the NFL, we wouldn't be so worried about diversity.

Social Networking 101: What Does It Mean for Employers?

Patrick Smith — Wed, 06 Jan 2010 16:21:06 -0600

Several commentators have identified the proliferation of social networking as one of most important new developments/challenges/obstacles that employers faced in 2009, and will continue to deal with in the foreseeable future.

Despite all the discussion in blogs and other places about this phenomenon, for those who do not spend lots of time in this arena, there is not a clear understanding of what social networking really is, and what are the benefits and potential drawbacks for employers.

There are hundreds of sites and posts containing information and opinions about social networking. But, for those who want to get started with some basic information, I commend you to the following sites:

First, is "Social Networking Policies: Best Practices for Companies", published in The Metropolitan Corporate Counsel. This article answers basic questions such as, "what is social networking?", what are the benefits and risks?; are there any best practices?

Second, is "The 3 Principles of Social Media: How to be a good online citizen, in the Delaware Employment Law Blog. This post provides a good discussion of the purposes of social media and how it can be used effectively.

Third, is an overview of recent Federal Trade Commission regulations concerning the use of endorsement in advertising, and how those regulations could cause potential liability for companies whose employees use social networking.

Random Thoughts to End the Year

Patrick Smith — Thu, 31 Dec 2009 09:30:03 -0600

It seems common sense that a lawyer or witness would not answer a ringing cell phone in the middle of a court proceeding, but it happens enough that judges now have to have rules about it.

Molly DiBianca at Delaware Employment Law Blog takes on the entitlement mentality of some employees who think they should be allowed to do personal business on company time and have complete privacy over personal e-mails sent on the company Blackberry.

For a low cost perk that will make your employees happy in 2010, HR Daily advisor recommends a flexible scheduling program.

Guess who said it:

I always figured that I would [eventually practice]. But it was midway through law school when I thought I wanted to do something different before practicing. I wanted to try something new because I didn’t want to have any regrets.

Answer: former Texas Tech football coach Mike Leach, J.D., in an interview with "BItter Lawyer", on why he went into coaching instead of law practice. Leach's lawyer has apparently promised to file a lawsuit against the University "soon" over his termination.

Daniel Schwartz of Connecticut Employment Law Blog notes the difficulty of accurately predicting what will happen in the year ahead; he does go out on a limb with this one though: "We're not making contact with aliens." Some days I'm not so sure.

Speaking of predictions (and football), here's a couple: Iowa State 20, Minnesota 14 in the Insight Bowl. In the Orange Bowl, Iowa 24, Georgia Tech 21. Go Cyclones and Hawks!

Happy New Year--see you in 2010!

Summary Judgment: Myths and Realities

Patrick Smith — Wed, 30 Dec 2009 12:20:38 -0600

"Is Summary Judgment in Employment Cases a Myth"? So ask attorneys Teresa Ride Bult and Kate Summers in an excellent article published last month in Law 360.

The authors contend it is becoming more difficult for employers to win on summary judgment, particularly in state court. Nonetheless, they believe the benefits of filing a summary judgment still outweigh the cost. The work that goes into a summary judgment will have to be done anyway as part of trial preparation. Even if all claims are not dismissed, summary judgment can weed out some of the weaker claims, making the case simpler to try. Finally, a motion for summary judgment forces plaintiffs to tip their hand about their theory of the case and the evidence they rely upon.

I agree that the summary judgment is an important weapon in the defense lawyer's arsenal in an employment case. We recently wrote about the chances of an employer winning at trial--and the statistics were not heartening. On the other hand, a study of the federal courts published last year shows that summary judgment is granted to defendants in discrimination cases more than in any other type of civil case in the federal system. Locally, anecdotal evidence suggests that summary judgments are granted in a very high percentage of cases in federal court s in Iowa. The Eighth Circuit also has a reputation for being very "defendant friendly" in employment cases. Almost all of the employment cases the Eighth Circuit decides are appeals of summary judgments, and most of the time the trial court's ruling is affirmed.

Of course, it is a different story altogether in State Court in Iowa. An employer's motion for summary judgment in State Court is denied more often than not. So much so that many plaintiff's lawyers assert claims only under the Iowa Civil Rights Act so as to avoid having the case removed to federal court. I attribute the difference in outcome to a couple of factors. First, state court judges, particularly those in more rural areas, are not as familiar with employment discrimination law. Second, state court judges have less access to law clerks compared to their federal counterparts, and it is thus much more difficult to digest factually complex motions for summary judgment and conduct the intense legal research that is often required. My cynical side says that summary judgments are sometimes denied because judges know the case is likely to be settled anyway, and it is not likely to ever reach the desk of an appellate court.

So, should employers file a motion for summary judgment in employment cases? The following statement of attorneys Bult and Summers is a fairly good summary of my opinion on the subject:

Employment litigation can sometimes feel like pure, unadulterated blackmail, and the bleak news presented in this article about the state of summary judgment dismissals provides only adds to the arsenal in the war against employers.

But the reality is in employment litigation, a good offense is the best defense.

An employer who has proper policies and procedures in place, makes reasoned and fair decisions, and who makes significant efforts to follow the law will be a much better position to defend against employment litigation and will have a much better shot at being “that case” that even a state court judge will dismiss on summary judgment.

While it is true that even frivolous lawsuits will make it to court, an employer must then analyze how to contain its costs and minimize its risks.

Reviewing Handbooks Should Be a Priority in the New Year

Patrick Smith — Tue, 29 Dec 2009 14:21:45 -0600

Update-January 6, 2010: For information on how employee handbooks, and particularly safety plans, can contribute to lower insurance costs, see Lara Utter's recent post in Iowa Biz.

There is no federal or Iowa law that requires an employer to have a handbook--but most of us do anyway. While handbooks can be quite useful for communicating information and expectations to employees, a poorly drafted or conceived one can create more trouble than it solves. Handbooks are often updated to comply with new laws and regulations, but seldom do employers review handbooks with the idea of removing information or making them simpler. Sometimes, no one in the organization knows where a particular rule or policy came from. It simply stays in the handbook year after year because...well, because it's always been there.

A good resolution for 2010 is to review your handbook with at least some of the following in mind:

1. Just because another company had a particular rule, policy, or procedure does not mean your company should;

2. Do you really want a detailed progressive discipline procedure? Often, the only time anyone reads this is after they have been disciplined or terminated, and it turns out it wasn't followed;

3. Make sure the "at-will" disclaimer is in a prominent place, but don't let it lull into thinking you can safely terminate an employee for any reason or no reason at all;

4. It is important to communicate that you are an equal opportunity employer and do not discriminate; but don't try to paraphrase all the EEO laws in your handbook. You might get it wrong, or make promises that get you in to trouble later (e.g., "we always accommodate employees with disabilities").

5. Does your handbook adequately communicate your leave policies? You must set forth clearly the employee's rights and responsibilities under the Family and Medical Leave Act;

6. Do you have a policy on social networking? Do you need one? What are you trying to accomplish with a social networking policy?

7. Does your handbook comply with the National Labor Relations Act? This is commonly overlooked, because most private employers do not have unions. However, the NLRA applies to employers regardless whether its employees are organized. The following policies may potentially violate the NLRA if they are deemed to infringe on an employee's rights to engage in protected, concerted activity:

prohibiting the use of e-mail for "non-business" communications;
prohibiting the wearing of pins or decals;
requiring management approval before posting information on bulletin boards;
statements to the effect that information about wages or compensation is strictly confidential and may not be disclosed to other employees;

8. Does your handbook contain information about classifications under the Fair Labor Standards Act? Are the classifications accurate?

9. Does your handbook provide easy to understand information about who employees should talk to if they have a complaint about harassment?

10. What is your policy concerning employer issued mobile phones and smart phones? Do you allow for personal use? Do you expect employees to answer calls or e-mails after hours, and if so, are they compensated for that time?

2009: The Year in Review

Patrick Smith — Mon, 28 Dec 2009 11:23:31 -0600

This is the time of year for reflection--when we look back on what happened during the past year, and look ahead to the coming year. There are many commentaries and opinions on what was good and bad about 2009, but there is no doubt it was an eventful year for those of us in the labor and employment law world. In this post we give a month-by-month account of the significant employment law events of 2009:

January: To usher in the new year, on January 1, the ADA Amendments Act became effective. On January 26, the U.S. Supreme Court issued a ruling in Crawford v. Metro Metro Government of Nashville, which held that an employee who answered questions as part of an internal harassmenti nvestigation was protected from retaliation under Title VII's "opposition" clause. On January 29, President Obama signed into law the Lilly Ledbetter Fair Pay Act. The Ledbetter Act was the first law the President signed after his inaugeration.

February: The president signed into law the American Recovery and Reinvestment Act of 2009 (a/k/a the "Stimulus"). Important to employers and employees, the law provided a 65% premium subsidy for nine months to employees involuntarily terminated from their jobs since September 1, 2008.

March: On March 10 the Employee Free Choice Act (EFCA) was introduced in both houses of Congress. The proposed EFCA contained the most signicant changes to labor law since the NLRA was enacted in the 1930s. While the law was and is a top priority for labor unions to get enacted, so far its most controversial provisions, inlcuding elimination of secret ballot elections, mandatory arbitration, and increased penalties for unfair labor practices make the proposed law unpopular with business interests.

April: The U.S. Supreme Court issues its second labor and employment decision this year: Penn Plaza, LLC v. Pyett. The Court held that “a collective-bargaining agreement that clearly and unmistakably requires a union member to arbitrate ADEA claims is enforceable as a matter of federal law.” On April 24, the EEOC issued a "Best Practices" document relating to employees with caregiving responsibilities. The Iowa Supreme Court issued its decision in the case of Varnum v. Brien, which held that Iowa's law that permitted marrigage licenses to be issued only to a man and a woman violated the Iowa Constitution.

May: On May 1 Governor Culver signed the Iowa version of the Ledbetter Fair Pay Act. This law amended to the Iowa Civil Rights Act to incorporate provisions of both the Ledbetter Act and the Equal Pay Act. The H1N1 pandemic was in the news, and the EEOC issued guidelines to help employers comply with the anti-discrimination laws while helping stop the spread of the disease. Sonia Sotamayor was nominated to replace the retiring Justice Souter on the U.S. Supreme Court.

June: The U.S. Supreme Court issued two important employment law decisions this month: Gross v. FBL Financial Services, Inc. and Ricci v. DeStefano. While there is some disagreement, our view is that both decisions were favorable for employers.

July: The phenomenon of social networking and its impact on the workplace is becoming the issue de jour. Al Franken is confirmed as the winner of the Senate election in Minnesota, which gives the Democrats a 60th seat and filibuster proof majority. However, the proposed EFCA law still goes nowhere. With the economy still in the doldrums, the Department of Labor issues a document addressing frequently asked questions relating to furloughs.

August: It's the dog days of summer, which means the Iowa State Fair, and controversy over allegations of religious discrimination.

September: The Iowa Supreme Court issues a ruling in DeBoom v. Raining Rose, Inc. one of the court's most important employment discrimination decisions. The EEOC released proposed regulations on the ADA Amendments. In wage and hour news, convenience store chain Casey's General Stores paid $11 million to settle FLSA claims of thousands of current and former employees.

October: President Obama signs into law modifications to FMLA relating to military caregiver leave and qualifying exigency leave relating to military service.

November: The Genetic Non-Discrimination Act becomes effective November 21. Data from both the Iowa Civil Rights Commission and EEOC show officially what many of us observed in our practices: an uptick in discrimination claims this year. On November 30, the Eighth Circuit issues an opinion in the remand of Gross v. FBL Financial. Despite Gross' arguments that his jury verdict under the Iowa Civil Rights Act should stand, the court sent the case back to the Southern District of Iowa for a new trial.

December: The U.S. Department of Labor issued an "Employment Law Guide" which covers topics such as wage and hour, occupational safety, and employee benefits, among others. The EEOC and Department of Labor release their regulatory agendas for 2010. Finally, President Obama signs a law that will extend the COBRA subsidy another two months, until February 28, 2010.

Best wishes for the rest of 2009 and a happy and prosperous 2010!

Are Employee Religious Freedoms in Jeopardy?

Patrick Smith — Wed, 23 Dec 2009 11:09:30 -0600

There is an interesting op-ed in today's Des Moines Register concerning religious discrimination in the workplace. The author, Lake Lambert III, is a professor of Religion at Wartburg College in Waverly. He contends employees are subject to religious tyranny because Title VII does not give enough protection to employees' ability to practice their religion at work. Under existing law, an employer is required to provide a reasonable accommodation of an employee's religious practice, unless it would result in an undue hardship on the conduct of the employer's business. Generally speaking, an accommodation is an undue hardship if it is costly, compromises safety, decreases efficiency, infringes on the rights of other employees, or causes other employees to do more than their share of hazardous or burdensome work.

Professor Lambert supports a proposed law known as the "Religious Workplace Freedom Act(RWFA)", which would change the existing reasonable accommodation standard. Under the proposed law, for an accommodation to be considered reasonable, "the accommodation shall remove the conflict between employment requirements and the religious observance or practice of the employee." The only defense to such an accommodation is if it requires "significant difficulty or expense." In other words, the burden would be on the employer to alter any employment requirement that conflicts with an employee's religious practice, unless the employer can prove it would be too financially costly.

Few would disagree that employees should be permitted time off to attend religious services, observe holy days, and the like. If that is the problem, the proposed changes in the law could be more narrowly tailored to address it. In a country with so many different religious practices, however, an expanded duty to accommodate them all could create more problems than it solves. What happens when the practices of different religions conflict? What about situations where an employer's legitimate interest in safety or uniformity impacts an employee's desire to wear religious clothing or articles? Under existing law, employers have more flexibility to address these situations in the context of legitimate business needs. The proposed RWFA tips the balance too far the other way.

While Professor Lambert's proposal may sound good in theory as a way of promoting religious tolerance, in practice it imposes unreasonable obligations on employers and adds very little to religious liberty.

Gross v. FBL Remand: Eighth Circuit Considers Additional Issues

Patrick Smith — Mon, 14 Dec 2009 09:36:40 -0600

On November 30, 2009, the U.S. Court of Appeals for the Eighth Circuit issued an opinion on the remand of Gross v. FBL Financial Group, Inc. We have discussed the Gross case in several previous posts (here, here, and here). The case has particular local interest because it was tried in the Southern District of Iowa, appealed to the U.S. Court of Appeals for the Eighth Circuit, and ultimately to the U.S. Supreme Court.

In a decision that surprised many in the employment law community, the Supreme Court held that an age discrimination plaintiff always has the burden of proving that age was the "but for" cause of the adverse employment action, regardless whether the employer had a "mixed motive", and regardless whether there is "direct evidence" of discrimination. Under Gross, the burden of persuasion never shifts to the defendant. The trial judge's instructions were in error, the Court concluded, because FBL was required to prove it would have made the same decision regardless of Gross' age. The case was remanded for a new trial.

Despite the Supreme Court's ruling, Gross argued to the Eighth Circuit on remand that his original jury verdict should stand because the jury was correctly instructed under the Iowa Civil Rights Act (ICRA). Notably, this was the first time the ICRA issue had come up in the case. The reason: between the date of the U.S. Supreme Court's decision in Gross and the Eighth Circuit's remand opinion, the Iowa Supreme Court issued an opinion in the case of DeBoom v. Raining Rose, Inc. One of the significant issues decided in DeBoom was that an employer is liable under the ICRA if the jury finds unlawful discrimination was "a motivating factor" in the employment decision. Gross argued that it did not matter under the ICRA whether the burden shifted to FBL to prove the "same decision" defense, because liability attaches once the jury concludes discrimination was "a motivating factor."

We predicted back in September that DeBoom would have a significant impact on the litigation of age discrimination cases in Iowa, because the standard under the ICRA was different than under the ADEA. We did not realize at the time, however, that the issue would come up in the Gross case itself.

Interestingly, Judge Colloton, writing for the Court, did not agree with Gross' contention that the jury was instructed consistent with the Iowa Civil Rights Act, and thus remanded for a trial on both the ICRA and ADEA claims. Why? The primary reason was that DeBoom was a "pretext" case, and not a "mixed motive" case. In mixed motive cases, the Eighth Circuit concluded that Iowa precedent requires the same approach as the Eighth Circuit did pre-Gross. That is, the defendant has the burden of proving the same decision defense only if there is direct evidence of discrimination. Thus, the jury instruction was still in error, despite DeBoom.

This matter is far from settled,and will likely result in further litigation in the Iowa Courts for years to come. It is not clear the Iowa Supreme Court intended the DeBoom case to be as limiting as the Eighth Circuit purported to make it.

What are My Chances of Winning?

Patrick Smith — Fri, 20 Nov 2009 11:30:31 -0600

Understandably, this is the most important question a client will ask his lawyer when deciding whether to settle a lawsuit or defend the case at trial. It is also one of the most difficult things for lawyers to predict. That's why jury verdict research is so valuable, and why this post at Manpower Employment Blawg is a must read for employers and HR professionals. It turns out that 2009 was not a very good year at the courthouse for employers defending employment related lawsuits. Here is a summary of the some of the jury verdict data:

The median jury award in discrimination cases rose 16%, from $208,000 to $241,119.
Employers won 39% of the time (or lost 61% of the time, depending upon your perspective). In age cases, employers were successful only 33% of the time, and in disability cases, 52% of the time.
Age discrimination claims resulted in the largest verdicts, followed by disability, sex, and race.
Employers are generally better off in federal court: they won 43% of the time there, versus 37% of cases in state court. The median award was also lower in federal court ($164,925 vs. $270,000). Federal Court is also more favorable for employers because of the relatively high percentage of cases for which summary judgment is granted.
The median settlement amount for all cases: $90,000, 20% higher than last year.

E-mail as Evidence Isn't Everything

Patrick Smith — Thu, 12 Nov 2009 10:29:27 -0600

One of the biggest worries of lawyers defending against employee lawsuits is the stray statement in an e-mail that can be blown up or taken out of context. We are constantly warning clients that, before they click "send", they should think about how an e-mail will look to a jury.

However, the recent acquittal of two former Bear Stearns executives accused of securities fraud provides an important lesson on the limitations of e-mail as evidence. The government's case against the Wall Street executives relied heavily on statements they made in e-mails. It seems the strategy backfired, and the e-mail turned out not to be the holy grail the prosecutors thought it would be. According to one lawyer, the "texting, twittering, Blackberry toting jurors of today understand that an e-mail capturing a concern, doubt or momentary distress does not reflect thought over time, much less a vetted public statement, "Skilled lawyers can help pull some of the sting out of the most seemingly damning emails, it seems, by working hard to place them into a broader context."

While it is still a good idea to think twice before clicking "send", it it good to know that common sense and context is capable of overcoming a damaging e-mail statement.

Weekly Web Roundup: November 6, 2009

Patrick Smith — Fri, 06 Nov 2009 14:59:31 -0600

Thanks to Molly DiBianca of the Delaware Employment Law Blog for including us in the 2009 list of Top Employment Law Blogs. One of the things I have most enjoyed since launching this blog last April is the collegiality among bloggers and the willingness to share ideas and information.

Always a good source of practical information, the HR Daily Advisor had two posts this week dealing with employee's abuse of FMLA leave. The first addressed the abuse of intermittent leave, and the second tackled the problem of "pattern absences" (such as taking leave on Mondays or Fridays).

Jon Hyman at Ohio Employer's Law Blog discusses an interview with Phillies' starter Cole Hamels after game 3 of the World Series. Media reports of the interview contained a quote from Hamels that made it appear he had given up on the Series after his poor game 3 performance. When considered in the context of the entire interview, however, it was clear Hamels was looking forward to the opportunity to redeem himself in game 7 (alas, a game which never was played). The lesson for employers: be careful what you say and how you say it, because it is easy to take words out of context, especially for cross-examining lawyers.

Megan Erickson of the Social Networking Law Blog has two recent posts (here and here) on factors employers should consider before drafting a social networking policy. With the explosion in social networking over the past year, this has become a hot topic for employers. See our related posts on this subject here and here.

H1N1 seems to have subsided among school age children in the local area, but now is hitting more adults. The Washington D.C. Employment Law Update reports that two members of the House of Representatives have introduced a bill that would permit employees five paid sick days if they contract H1N1. The Emergency Influenza Containment Act would apply to employers with fifteen or more employees. It would permit both full and part time employees to be paid if sent home by their employer because of the flu.

Finally, are employers under siege by the EEOC? This post on Workplace Prof Blog reports on a human resources meeting in Detroit where many attendees reported facing EEOC charges for the first time. The EEOC denies it is cracking down. However, there is little doubt that charge statistics are up, and the EEOC's own press releases report the filing of substantially more lawsuits now as compared to one year ago.

Iowa Civil Rights Commission Issues 2009 Annual Report

Patrick Smith — Fri, 06 Nov 2009 14:15:55 -0600

On October 30, the Iowa Civil Rights Commission (ICRC) issued its annual report for 2009. Once again this year, complaints of employment discrimination constituted the vast majority (85%) of the charges. The non-employment charges (in the areas of credit, education, housing, and public accommodations) make up the remaining 15% of the charges.

The total number of complaints alleging employment discrimination increased by 13% over the prior year, from 1453 in 2008 to 1644 this year. The rate of increase in charges filed with the ICRC is comparable to the increase in those filed with the federal EEOC. Of course, most charges filed with the ICRC that alleged employment discrimination are also cross-filed with the EEOC.

The category with the largest number of complaints was sex (717), followed by race, (694), disability (562) and age (368). There were 55 claims of religious discrimination, and six alleging discrimination on the basis of sexual orientation or gender identity. Despite the publicity relating to the Iowa Supreme Court's decision legalizing marriage among persons of the same sex, there was no increase in charges in the sexual orientation category.

The largest increase in the type of claim was retaliation. Retaliation claims increased 30%, from 435 last year to 567 this year. Although retaliation is a separate category of complaint, charges alleging retaliation are frequently accompanied by a charge of discrimination.

Weekly Web Roundup, October 30, 2009

Patrick Smith — Fri, 30 Oct 2009 13:15:52 -0600

The EEOC has revised its "Equal Employment Opportunity is the Law" poster. The poster was revised to reflect new federal employment laws, including the ADA Amendments, and the Genetic Non Discrimination in Employment Act ("GINA"). Employers can either obtain a new poster, or a supplement their existing poster. The new posting is mandatory effective November 21, 2009. Up to ten posters can be obtained from the EEOC free of charge, or can be printed from the EEOC's website.

The FMLA Blog reports on amendments to the FMLA the president signed this week. Among the changes: military care giver leave will now apply to for veterans of the Armed Forces under certain circumstances. In addition, Qualifying Exigency Leave is expanded to cover members of the regular military who are deployed to a foreign county. Under existing law, such leave applied only for covered military members in the Reserves or Guard.

The best way to avoid workplace problems--avoid bad hires in the first place. Two posts this week on HR Daily Advisor (here and here) identify five steps for gathering critical background information about prospective employees without breaking the bank, and while respecting the privacy rights of the applicant.

A woman in Missouri sued Wal-Mart and other establishments under the ADA for denying access to her Bonnet Macaque monkey. The Plaintiff claimed the monkey was trained to assist her with anxiety and agoraphobia, and she could not function in public unless the monkey was with her. The U.S. District Court in the Western District of Missouri granted summary judgment to the defendants, finding that Plaintiff was not disabled, nor was her monkey a "service animal" under the ADA for which the establishments were required to provide reasonable accommodation.

This Bud's for you. A former Chief of Communications at Anheuser-Busch (now Anheuser Busch in Bev) filed a lawsuit against the company for gender discrimination. The former executive claims the company maintains gender bias in pay and promotions, excludes women from social networks, and promotes few women to top jobs and committee posts. Most shocking to any viewer of beer commercials is this allegation: that the company fostered a locker room and frat party atmosphere in the workplace.

What Can Employers Do About H1N1?

Patrick Smith — Thu, 29 Oct 2009 12:43:46 -0600

We have provided links before to EEOC's Guidance to employers concerning compliance with the ADA during a pandemic. Now that we seem to officially be in the midst of one, it is a good time to revisit what is permissible for an employer to do help contain the spread of H1N1.

Section III (B) of the EEOC document contains guidance on what employers can do during a pandemic. Some of the very practical questions addressed include the following:

1. May an employer send an employee home who displays influenza like symptoms? Answer: yes; if there is a pandemic asking such workers to go home is not a disability related action. Even if there was no pandemic, if the influenza resulted in a direct threat to the health or safety of the employee or others, the employee may be sent home.

2. How much information can an employer request from employees who report feeling ill or call in sick? Answer: employers may ask if the employee is feeling influenza like symptoms, such as chills or a fever and a cough or sore throat. Any information obtained through such an inquiry must be treated as a confidential medical record.

3. May an employer require employees to wear personal protective equipment (e.g. face mask, gloves, or gowns)? Answer: yes, however, it must be noted that if a person needs a reasonable accommodation to wear such equipment (e.g. non-latex gloves), the employer should provide these, absent undue hardship.

4. May an employer compel its employees to obtain influenza vaccine? Answer: employees may be entitled to exemptions from mandatory vaccination because of a disability, or because of a sincerely held religious belief. Whether or not the employee is exempt would depend upon if not taking the vaccine would be a reasonable accommodation of the disability or religious belief.

It is important to note that it is the pandemic condition that gives employers the right to make certain inquiries. If there is not a pandemic situation, or if you are unsure, you should seek advice from your employment counsel before taking any action relating to H1N1.

Weekly Web Roundup: October 16, 2009

Patrick Smith — Fri, 16 Oct 2009 09:08:18 -0600

Wage and hour collective actions remain active in Iowa. A Judge in Clinton County just approved a collective action settlement in which Wal-Mart agreed to pay $11 million to settle claims that it failed to pay overtime, properly account for breaks, and altered time records. Employees and former employees who worked for Wal-Mart in Clinton between 1999-2009 will receive between $25-300 each.

Flu season is officially underway, and the H1N1 virus has been back in the headlines. Ogletree Deakins has published an informative Question and Answer document concerning an employer's rights and obligations in dealing with employees who have the H1N1 virus. In addition, the EEOC recently published a technical advisory entitled "Pandemic Preparedness in the Workplace and the Americans with Disabilities Act."

Also from the EEOC, the Agency released on October 6 an informal opinion letter concerning employee health risk assessments. The letter, authored by EEOC assistant legal counsel Peggy Mastroianni, takes the position that requiring employees to answer personal health questions as a condition of receiving an employer provided health reimbursement expense benefit violates the ADA. Although an informal opinion letter is not binding, it provides insight into how the Agency evaluates these issues. For more analysis see this post at the Washington D.C. Employment Law Update.

Are you a lawyer who regularly uses motions for summary judgment in defending employment claims? Before you file your next one, check out this post at Workplace Prof Blog. Lawyers for United Airlines filed a motion for summary judgment in a race discrimination suit pending in California state court. The Court noted the motion sought "adjudication of 44 issues, most of which were not proper subjects of adjudication. Defendants’ separate statement was 196 pages long, setting forth hundreds of facts, many of them not material—as defendants’ own papers conceded. And the moving papers concluded with a request for judicial notice of 174 pages. All told, defendants’ moving papers were 1056 pages." Once the plaintiff's resistance and the defendant's reply were considered, 5,415 pages of material were presented to the trial judge. The Appellate Court characterized this as "what may well be the most oppressive motion ever presented to a superior court ".

In reversing the trial court's ruling granting summary judgment, the Court spared no criticism of the trial judge. The reason for the reversal: "what apparently happened is that the trial court did not read all the papers." However, in the end, the Court gave the trial judge a break: "While not reading the papers cannot be condoned, it can perhaps be understood, as we hesitate to speculate how long it would take a trial court to meaningfully digest over 2200 pages of separate statements, analyze and rule on 764 objections set out in 325 pages, review it all in light of the applicable law, and then write a proper order."

The Court concluded with an admonition we all should heed the next time we file one of these motions: "The incredible volume of material here simply has no place in a system where overburdened trial courts labor long and hard."

Finally, Molly DiBianca at the Delaware Employment Law Blog reports on a survey of employers concerning their use of social networking media as part of applicant screening. 45% of respondents reported using social networking for background checks, with 35% of those having rejected a candidate for what they found there. What will disqualify a potential employee? Among other things, provocative photos or information; depiction of drinking or drug use; lying about your background or qualifications; or discriminatory comments.

An Interesting Interview with Jack Gross

Patrick Smith — Mon, 12 Oct 2009 09:20:19 -0600

Des Moines Register columnist Marc Hansen writes about an interview he had with Jack Gross, the plaintiff in Gross v. FBL Financial, Inc., decided by the U.S. Supreme Court last June. Mr. Gross was in Washinton, DC last week to testify before the Senate Judiciary committee that is considering amendments to the ADEA that would effectively overrule the Gross decision.

Lawyers and judges think and talk about cases in terms of how the "law" applies to the "facts." It is easy to forget these controversies involve real people with interesting backgrounds, stories, and motives. Any good trial lawyer knows the likelihood of success in a lawsuit often depends more on the people involved and how they present themselves, rather than obscure legal rules or abstract "facts."

Jack Gross' case is now back in the Southern District of Iowa, waiting for a new trial. The jury instructions will be slightly different this time around (assuming Congress has not changed the law by then). It will be interesting to see if it makes any difference in the outcome.

It's Official: Retaliation Claims Increase

Patrick Smith — Tue, 06 Oct 2009 09:23:17 -0600

EEOC statistics for the year ended September 30, 2008, the most recent data that is available, show that charges of retaliation increased by 23% compared to the prior year. In addition, more than 1/3 of the charges filed with the Agency allege retaliation as one of the claims. According to this article in The Wall Street Journal, retaliation claims have tripled since the EEOC started keeping track of them in 1992. The statistics don't include data for the year ending 2009, but anecdotal evidence from lawyers and human resource professionals suggests the trend continues to accelerate.

One reason retaliation claims are so common is that it is easier to prove retaliation than discrimination. An employee who charges retaliation does not have to prove that he was discriminated against--only that he engaged in what is called "protected activity", and as a result the employer took some adverse action against him.

"Protected activity" includes a broad range of actions, from filing a formal charge with the EEOC or state civil rights commission, complaining to an HR official about harassment, giving an interview in connection with an internal discrimination investigation, or providing testimony in support of another employee who claims discrimination.

A 2006 U.S. Supreme Court decision, Burlington Northern v. White, also made it easier for employees to prove retaliation. In White, the Court held that the "adverse action" to which an employee is subject does not have to involve something substantial like a termination, demotion, or cut in pay. Rather, the employer's action need only be "materially adverse" to a "reasonable employee". What does that mean? According to the Supreme Court, "materially adverse" means anything that would have "dissuaded a reasonable worker from making or supporting a charge of discrimination"

In Iowa and many other states, an employee may file a retaliation lawsuit if they were terminated for exercising certain legal rights or fulfilling legal obligations. Examples include reporting an on the job injury, filing a workers' compensation claim, or serving on a jury. This type of claim is known as "wrongful discharge in violation of public policy." It is slightly different than retaliation based upon discrimination because it requires an actual termination; some lesser action will not suffice.

This is a lesson most employers and HR Professionals have heard, but it bears repeating: be cautious and deliberate when taking any action against an employee who may have engaged in protected activity. That does not mean avoiding discipline or other action that is necessary, but it does mean making sure you have legitimate and documented reasons for whatever action is taken.