Employer's Burden of Production Under McDonnell Douglas May Be Light, But Is Still Real

As the INS finds out as it suffers the reversal of a summary judgment because it failed to meet its burden of production under McDonnell Douglas. The Court started by reiterating what is well established law:

To rebut the presumption of discrimination created by the employee’s prima facie case, the employer must articulate a legitimate, nondiscriminatory reason for its decision. As this is a burden of production, the employer need not prove that it was actually motivated by its proffered reason.

Successfully doing so, removes the prima facie case and places the burden on the plaintiff of showing that there is a triable issue of fact on his or her claim. Patrick v. Ridge (5th Cir. 12/16/04) [pdf].The parties did not dispute that the plaintiff made a prima facie case that she did not receive a promotion either because of her age or in retaliation for filing an earlier claim of discrimination.



Instead, the focus was on the two reasons that the INS gave for not selecting her for the position. Its first reason was that she "was not sufficiently suited for the job." Unfortunately, the Agency did not express why she was not suited. Other than saying all candidates were evaluated not only for their work credentials and experience but how they would fit into the work group, the INS offered no further explanation. That failed to meet the burden of production because it failed to provide a reason "with 'sufficient clarity' to afford the employee a realistic opportunity to show that the reason is pretextual." Making the first of two, "as a matter of law" rulings the Court held:

We hold as a matter of law that justifying an adverse employment decision by offering a content-less and nonspecific statement, such as that a candidate is not “sufficiently suited” for the position, is not specific enough to meet a defendant employer’s burden of production under McDonnell Douglas. It is, at bottom, a non-reason.

The INS' second articulated legitimate reason fared no better. It claimed that it hired the best qualified person. Unfortunately, it did not even seek the candidate that it ultimately hired until it had eliminated a whole panel of applicants, including the plaintiff, as unacceptable. Using a "snapshot" view, the appeals court made its second matter of law holding:

We hold as a matter of law that an employer who offers the relative qualifications of the applicants as its legitimate, nondiscriminatory reason must show that, at the time it made the decision adverse to the complaining applicant, it already knew that the ultimately selected individual’s qualifications were superior.

To quote the Court again, "at bottom", the INS failed to meet what seems to be the minimal standard of articulating a legitimate reason for its action. Failing to meet that burden of production means the prima facie case remains intact at this stage and the case is remanded to the trial court for further action.



A good reminder not to overlook the simple things, some times they do mean a lot.

10th Cir. - FMLA Regulation on "Worksite" Arbitrary, Capricious and Unenforceable

It seems it takes about a decade for a new employment statute to become widely known, cases to be filed and appellate decisions issued on a regular basis. Sure enough, the volume of appellate decisions seems to be increasing as we begin the 2nd decade of the FMLA. For the second time in a week, an appellate court has occasion to address one unusual aspect of the FMLA, the so called 50/75 rule.



In order to be an eligible employee (and thus eligible for FMLA leave) the employer must have 50 employees within a 75 mile range of the employee's worksite. As the 6th Circuit held last week, see my previous post, an employee ineligible because of the 50/75 rule can not bring a retaliation claim. In Harbert v. Healthcare Services Group, Inc. (10th Cir. 12/13/04), the issue was entitlement to FMLA leave itself. Harbert was an account manager for HSG which provided housekeeping and laundry services to long-term care institutions. She was assigned and worked on a daily basis at Sunset Manor in Brush, Colorado. She reported to a regional manager who was in Golden, Colorado. Under these facts the parties did not dispute that she was jointly employed by HSG and Sunset Manor. At issue was the DOL regulation defining "worksite" in cases of joint employment, 29 C.F.R. 825.111(a)(3):

For purposes of determining that employee's eligibility, when an employee is jointly employed by two or more employers (see 29 C.F.R. §825.106), the employee's worksite is the primary employer's office from which the employee is assigned or reports. The employee is also counted by the secondary employer to determine eligibility for the secondary employer's full-time or permanent employees.

The rub of course is that there were 50 employees within 75 miles of Golden, but not 50 employees within 75 miles of Brush. Under the regulation, Harpert was entitled to FMLA leave because she reported to Golden; HSG had denied her leave.



Since there was no argument for compliance under the regulation, HSG took another route and attempted to blow it up. Successfully as it turns out. Although the dissenting member of the panel, noted that it was "heavy medicine" to overturn a regulation, that is exactly what the Court found -- at least as applied in this circumstance, the regulation was "arbitrary, capricious, and manifestly contrary to the FMLA."



Although this exact fact pattern may not show up often, its significance may be that it is yet another FMLA regulation that an appellate court has refused to uphold. So far, the Clinton administration FMLA regulations have not fared all that well under Reagan/Bush (I and II) led courts. As more cases arise, stay tuned for more clashes.

"Exceptionally Endowed Young Woman" Is Both Direct Evidence and Court Speak For ....

"a young chippie with big tits", at least it was in Glanzman v. Metropolitan Management Corp. (3rd Cir. 12/14/04) [pdf]. The more descriptive words were part of a statement made by the plaintiff's boss to her co-workers that he would like to replace the her with just such a person. Although not the most colorful parts of the statement, it was the "young" that caused the problem, as the Court held this statement enough was sufficient to constitute direct evidence of discrimination, thus sending the case into the mixed motive world first announced in Price Waterhouse.



As a result, what the Court described as "the heavy burden" to show that it would have terminated Glanzman in any event, passed to the employer. Fortunately for the employer, Glanzman, an apartment manager, had done enough wrong, that the employer was able to meet this high standard even on summary judgment. Among her problems, multiple occasions where she both misused funds and lied about it, a number of times where she was not where she was supposed to be during working hours, she misused company employees to work on her own property and finally was caught in a scheme to steal a dishwasher. As the Court noted, it was not even necessary that all of these bad acts were true, just that the employer reasonably believed them to be. Finding that to be the case, the Court found there were a "surfeit of legitimate reasons to fire her." So, even though employers are justifiably concerned at being forced into the mixed motive arena, it is clear in the right case, that all is not lost.

Discrimination Claims of "Confederate Southern American" Fall

Last week it was the Church of Body Modification that the 1st Circuit faced, this week the 3rd Circuit gets the claim of a discharged security guard, who argues it was because of his national origin, "Confederate Southern American" and also his religion which arises from the same identity and the design of the Confederate flag. Storey v. Burns International Security Services (3rd Cir. 12/9/04) [pdf].



Once again, the all too obvious questions -- is this really a valid national origin, or is this really a religion -- get a pass:

For the sake of argument, we will assume that “Confederate Southern-American” is a valid national origin, and that the Confederate flag has some religious significance for members of this group.

Here, the Court found that Storey was really fired for refusing to remove Confederate flag stickers (4 to be precise) from his lunchbox. And since he did not make it clear that displaying the flags was significant to his religion, his case failed. Surely, there is a line somewhere that might raise the question of what is a valid religion, but if the Church of Body Modification or Confederate Southern-American, don't get us there, I can only wait with bated breath to see what does!

4th Cir. Upholds ERISA Plan's Requirement of Attorney Signed Subrogation Agreement

Employee benefit plans often have subrogation provisions which require an employee injured by a third party who sues and recovers to reimburse the plan for the benefits it has paid. The plan in question, took that one step further and required a signed subrogration agreement from the employee and his attorney that the plan would be paid "before all others." The attorney took the position that his fees should not be placed behind ERISA plan and refused to sign. The net result was severe in this case, since the employee not only did not get advances for the injuries caused by the third party, but since it was his only connection to the plan, he and his dependents were ultimately severed from the plan and lost all benefits.



Although the plan was challenged on numerous grounds, they all failed. Simply put, was nothing wrong with the requirement of the Plan that it be repaid -- first. Kress v. Food Employers Labor Relations (4th Cir. 12/10/04) [pdf].



And just in case, anyone should misunderstand the Court's position, "Throughout this litigation, Kress’s arguments have proceeded on the premise that the Fund’s provisions are somehow inimical to participants’ interests. But that is hardly the only interpretation that one could give them." Instead the Court noted the Fund provided advances when injuries were caused by third parties, even though it had no obligation to do so. Kress could have not accepted the advances and sued in tort with no obligation to the Fund. However, he could not accept the benefits, but choose not to accept the terms under which they were offered. (The legal equivalent of - you can't have your cake and eat it too.) Finally, the Court noted while he referred to the loss of all his benefits as "retaliatory," the Plan language clearly spelled out what would happen, and it was his attorney who refused to sign the agreement. Pretty clear where the Court thought the problem was in this case. Wonder if there might soon be a claim against the attorney who refused to sign?

FMLA Retaliation Only For "Eligible Employees"

Although all employers with more than 50 employees are covered by the FMLA, whether or not an individual employee is entitled to rights is based on other criteria. Among those who are not eligible employees, "any employee of an employer who is employed at a worksite at which such employer employs less than 50 employees if the total number of employees employed by that employer within 75 miles of that worksite is less than 50.” 29 U.S.C. § 2611(2)(B)(ii). Sandra Humenny was one such employee.



Yet, when she was terminated and felt that it was in part because she had expressed a need to take care of her sick mother, she filed a suit claiming, among other things, that she had been retaliated against for attempting to exercise rights under the FMLA. Her employer challenged her claim, arguing that in order to bring a cause of action for FMLA retaliation, she must be an eligible employee. Her argument -- since she was dismissed her for “attempting” to assert rights to which she, in good faith, believed she was entitled under the FMLA she should be allowed to sue. After all the retaliation provision refers to 'individuals' not 'employees.' Nice try, but wrong, said the Court, agreeing with the employer that to bring a suit for FMLA retaliation one must be an eligible employee. Humenny v. Genex Corp. (6th Cir. 12/8/04) [pdf].

Playing the Reference Game - More than Name, Rank & Social Security Number?

The official policy of most companies is to only give basic, neutral information. But many reference checkers have ways to try get more, and often succeed. And on the counter-offensive, commercial firms will check to see exactly what your prior employer is saying about you for a small fee. See Find Out What References Are Really Saying About You for the tricks of the trade.