Habitat for Humanity - Sexual Harassment Charge Leads to Founder's Departure

Although it sounds as if there were more than just the allegations brought by a female staffer of Millard Fuller's conduct on a trip to the Atlanta airport, the end result is that he is leaving the charitable housing organization he founded in 1976. Allen Breed of the AP has the story. The most recent allegations are not the first, and Fuller's explanation that he is from a "touchy-feely country culture" is not the sort of thing that inspires confidence in a defense lawyer's heart.



And in a weekend that has follow up stories on the settlement of a sexual harassment suit by one of the Twin Cities largest auto dealers after he was ordered to answer questions about his sexual conduct at his deposition, see Hecker suit aftermath, it is just a reminder that in many different places and at all levels, this appears to be a problem that will be with us for as long as ... well as certainly as long as I am writing this blog.

Congratulations to Workers Comp Insider

For being named "best of the web" for safety and loss control services by Business Insurance magazine. Perhaps its for such interesting postings as this story on California workers compensation judges filing their own claims for workers compensation. Here's the money quote:

Workers comp judges in [California] are six times more likely to file claims than judges in other state departments. And in a number of these cases, the judges hired the same attorneys – and used the same doctors -- who appear regularly in their courts. In addition, the claims are ultimately heard before their colleagues on the bench!

I don't profess to know anything about California workers compensation law, but unless there are some pretty dilapidated buildings in which workers compensation justice is being dispensed in the Governator's state, I would guess a lot of those are "stress" related claims. Hmmm.

Signature Not Required for Arbitration Agreement, But Absence Can Lead To Fact Question

And when the fact question is decided against you at the trial court, the presumptions strongly favor the appellate court affirming. Faced with a personnel file with no acknowledgement signed by the employee, the employee's affidavit that she did not receive critical parts of the arbitration program, and the trial court's ruling that there was no arbitration agreement, here is what the Court said:

We may not overturn the trial court’s decision unless that court could reasonably have reached only the opposite decision.

Unable to say that was the case, the Court upheld the denial of the motion to compel arbitration. In re: Dillard Department Stores, Inc. (Tx. App. - El Paso 11/24/04) [pdf].



Managing the logistical issues of an arbitration program for an employer of any size is no small feat, but for a larger employer in numerous locations it is almost physically impossible to do so without some slip ups. It is amazing how often it seems the slip up had to happen with one who ultimately sues.

More Than You Probably Want to Know About USERRA From the 5th Circuit

In a military city, at a time when troops, involving a substantial number of national guard and reservists, are on the ground in hostile combat, a lawsuit brought by firefighters who also are reservists claiming that the City of San Antonio was violating their rights because of their military service is bound to be politically sensitive. And when the Circuit Court of Appeals is going to reverse a decision in favor of the reservists, you could reasonably expect a detailed explanation of why such a result was necessary. Which is exactly what happened today in Rogers v. City of San Antonio (5th Cir. 12/2/04) [pdf].



The issue was whether or not the City's practice of treating the firefighters as "absent" as opposed to "constructively present" when away on reserve duty for the following benefits was a violation of Uniform Services Employment and Reemployment Rights Act of 1994:

(1) lost straight-time pay;

(2) lost overtime opportunities;

(3) missed upgrading opportunities;

(4) bonus day leave;

(5) perfect attendance leave;

and (6) a twenty-seven hour cap on lost overtime.

Ultimately the Court reversed summary judgment which had been granted in favor of the reservists in all 6 categories. On the first 3, it rendered judgment in favor of the City. On the latter 3 it found factual issues and remanded to the trial court for further proceedings.



The legal argument was over which section of USERRA applied to the reservists' claim. The reservists argued that the issue was controlled by Section 4311(a) that provides:

A person who is a member of, applies to be a member of, performs, has performed, applies to perform, or has an obligation to perform services in a uniformed service shall not be denied initial employment, reemployment, retention in employment, promotion, or any benefit of employment by an employer on the basis of that membership, application for membership, performance, service, application for service, or obligation.

The City argued instead that it was controlled by Section 4316(b)(1):

[A] person who is absent from a position of employment by reason of service in the uniformed services shall be - (A) deemed to be on furlough or leave of absence while performing such service; and (B) entitled to such other rights and benefits not determined by seniority as are generally provided by the employer of the person to employees having similar seniority, status, and pay who are on furlough or leave of absence under a contract, agreement, policy, practice, or plan in effect at the commencement of such service or established while such person performs such service.

The Court's opinion thoroughly (36 pages) reviews the history of legislation designed to protect the employment rights of those serving in the uniformed services, along with its judicial construction. For anyone interested in the issue or a case under USERRA, it should serve as a great starting point. Following that exhaustive review of these two sections, the Court held the City's view was correct.



At the risk of oversimplification, it found that §4311(a) was an anti-retaliation provision, while §4316(b)(1) was designed for exactly this situation. Its purpose was to ensure that on issues involving non-seniority issues, military personnel were given "equal but not preferential" treatment to employees on non-military leaves of absence. In the 6 categories about which questions were raised it found no dispute that was true on the first 3, but there were fact issues as to whether there was equal treatment on the last 3.



The Court did generally agree with the reservists on the applicable statute of limitations under USERRA. It did not rule on the reservists' claim that there is no USERRA statute of limitations and that the claims are subject to being barred only by the doctrines of laches or estoppel, because it found that argument was raised too late in the litigation. It did however agree that the statute of limitations was at least four, not two years as urged by the City.



I was critical in a recent posting of the 1st Circuit for failing to address the central question on religious discrimination in a case involving the Church of Body Modification. Although I didn't call it a court appearing to be too "politically correct", that thought ran through my mind. By contrast, this decision by the 5th Circuit is I think appropriately "politically correct." It takes great pain to explain in detail the rationale for its decision adverse to a group that is uniformly honored and respected for all that they do -- put most starkly -- risking their lives to protect ours.

Some Things About Wage and Hour Are Complicated, But Some Aren't

There are aspects of wage and hour law which can be quite complicated and involve judgment calls on which reasonable minds can differ. But the issue highlighted in this recent New York Times story, Employees go public about jobs that require working off the clock, is not. Knowingly allowing or requiring employees to work more than 40 hours without recording the time is not complicated, just wrong. The money quote, this time meant literally:

Many people who study business practices say off-the-clock work has become more prevalent because middle managers face greater pressure to lower labor costs and because the managers' bonuses may even be tied to cutting those costs. Off-the-clock work is most often found, they say, at workplaces that employ many immigrants, such as farms and poultry-processing plants, but the phenomenon has spread, especially among low-wage companies in the service sector. "There's more of this stuff going on than 10 and 20 and especially 30 and 40 years ago," said David Lewin, a human resources professor at the Anderson School of Management at UCLA. "There are a lot of incentives to engage in these kinds of practices, because they result in higher profits for the company, and they can lead to higher bonuses for local managers."

Employers should stop the practice because it is wrong, but if that is not enough incentive, they should check the growing number of collective action suits being brought under the FLSA and some of the rather hefty payments being made to resolve those claims.

A Piercing Problem - 1st Cir. Ducks the Real Question

In a cutting edge decision, the 1st Circuit today upholds Costco's dress policy against a challenge by an employee who argued her right to wear her eyebrow piercing was required by her religious beliefs as a member of the Church of Body Modification (CBM). Cloutier v. Costco (1st Cir. 12/01/04). According to the Court's opinion:

The CBM was established in 1999 and counts approximately 1000 members who participate in such practices as piercing, tattooing, branding, cutting, and body manipulation. Among the goals espoused in the CBM's mission statement are for its members to "grow as individuals through body modification and its teachings," to "promote growth in mind, body and spirit," and to be "confident role models in learning, teaching, and displaying body modification."

The Court also found that the CBM's website was its primary mode of attracting adherents. Included is an application to become a minister of the CBM. When Cloutier was terminated for refusing to remove her eyebrow piercing while working, she filed a charge of religious discrimination with the EEOC which found the her belief in the CBM creed to be "religiously based as defined by the EEOC." A very interesting choice of words.



Given that background one might think the central question to be addressed by the Court is the first element of a prima facie case of religious discrimination, did a bona fide religious practice conflict with an employment requirement? However, that question was decided by neither the district nor the appeals court. In the latter's words:

Determining whether a belief is religious is "more often than not a difficult and delicate task," one to which the courts are ill-suited. Thomas v. Review Bd. of Indiana Employment Sec. Div., 450 U.S. 707, 714 (1981). Fortunately, as the district court noted, there is no need for us to delve into this thorny question in the present case. Even assuming, arguendo, that Cloutier established her prima facie case, the facts here do not support a finding of impermissible religious discrimination.

Unfortunately, the Court's refusal means many employers can now anticipate challenges brought by the CBM faithful (or similar groups) resulting in more litigation, more costs, and at least in many's eyes, questions about the sanity of our legal system.



The district court found that Costco had made a reasonable accommodation, to allow Cloutier to cover her piercing with a band aid or wear a clear plastic retainer, which Cloutier refused. Thus even assuming it was a religious belief, Costco met its burden of accommodation. Unfortunately, there was a dispute as to the timing of the offer of accommodation -- was it before or after the termination? The district court was not bothered that the offer of accommodation might have been after the termination, but the appeals court was. Surveying other courts, it found a split in the circuits. It could have weighed in on that debate, but once again the court played artful dodger:

Even this limited discussion illustrates that the question of whether a post-termination offer extended during the EEOC mediation process can be a reasonable accommodation raises difficult issues. We have yet to consider this question directly and decline to do so here on the limited summary judgment record.

Instead the court based its affirmance of summary judgment for Costco on "an alternative ground advanced by Costco -- namely, that the only accommodation Cloutier considers reasonable would impose an undue hardship on Costco."



Cloutier's only accepted accommodation was a complete exemption from Costco's ban on facial jewelry. Why would that be an undue hardship? The Court's answer:

Granting such an exemption would be an undue hardship because it would adversely affect the employer's public image. Costco has made a determination that facial piercings, aside from earrings, detract from the "neat, clean and professional image" that it aims to cultivate. Such a business determination is within its discretion. As another court has explained, "Even assuming that the defendants' justification for the grooming standards amounted to nothing more than an appeal to customer preference, . . . it is not the law that customer preference is an insufficient justification as a matter of law." Sambo's of Georgia, Inc., 530 F. Supp. at 91.

Although perhaps distinguishable, in many contexts customer preference has proved not to be a justifiable basis for a discriminatory practice. One of the most famous for those old enough to remember the initial "Love Flights" of Southwest Airlines was their "customer preference" argument in support of their female only flight attendant policy. If you have flown SWA in the last 20 years, you know how successful that argument was for them.



Rather than stretch to get a result, the Court should have answered the tough question. Some day some court will.

Tort Claims Against Lab for Improper Drug Tests Not Preempted by Federal Statute

If you have an interest in the potential liability of a drug testing lab under various state causes of action, including negligence, you might want to check out Chapman v. Lab One (8th Cir. 11/30/04) [pdf]. Ruling in consolidated cases originally filed in the state courts of Iowa and Nebraska, the Court holds the Federal Railroad Safety Act, as amended by the Federal Omnibus Transportation Employee Testing Act of 1991, did not preempt a wide variety of state law claims brought against a drug testing laboratory which reported positive drug tests. The Court did not decide the issue of whether such claims against employers would be preempted by the same statutes.