Labor & Employment N.Y. ("LENY")

The Second Circuit, in Mihalik v. Credit Agricole Cheauvreux North America, Inc., No. 11-3361-cv (2nd Cir. April 26, 2013), ruled that federal standards do not govern claims under the New York City Human Rights Law ("NYCHRL"). Instead, such claims require a separate and independent analysis. The court explained that that the 2005 amendment of the NYCHRL compels this result.

Citing the First Department's decision in Williams v. New York City Housing Authority, 872 N.Y.S.2d 27 (1st Dep't 2009), the Second Circuit explained that under the NYCHRL the "severe and pervasive standard" is not the test of liability for gender discrimination, but is relevant only to the issue of damages. To prevail on liability, the plaintiff need only demonstrate by "a preponderance of the evidence that she has been treated less well than other employees because of her gender." The court cautioned, however, that the NYCHRL is not a "general civility code." Therefore, the plaintiff still must demonstrate "discriminatory motive," which requires a showing that she has been treated less well, at least in part, due to her gender.

Addressing the standard for a retaliation claim under the NYCHRL, the Second Circuit instructed that the plaintiff must establish that she opposed her employer's act(s) of discrimination and the employer responded with conduct "reasonably likely to deter a person from engaging in such action." The court opined that in the context of this case, Mihalik did not need to demonstrate that she was discharged for opposing her supervisor's alleged offensive behavior because "a jury could reasonably find that publicly humiliating Mihalik in front of her male counterparts and otherwise shunning her was likely to deter a reasonable person from opposing his harassing behavior in the future."

http://docs.justia.com/cases/federal/appellate-courts/ca2/11-3361/11-3361-2013-04-26.pdf

In Carter v. Luminant Power Services Co., No. 12-10642 (4/3/13), the Fifth Circuit, joined several other Circuits, in concluding that the cost-shifting provision of Title VII, 42 U.S.C. §2000e-5(g)(2)(B)(i), does not apply to mixed-motive retaliation claims. The court reasoned that the plain language of this section compels this finding. It explained that by its express terms the section applies only to violations under §2000e-2(m), which encompasses the anti-discrimination prohibitions of §2000e-2(a), but not the anti-retaliation proscription of §2000e-3(a).

The D.C. Circuit in Ayissi-Etoh v. Fannie Mae, No. 11-7127 (4/5/13), reversed the district court's grant of summary judgment for Fannie Mae. It found that plaintiff had established triable race discrimination and hostile work environment claims under the Civil Rights Act of 1866, 42 U.S.C. §1981.

Fannie Mae hired plaintiff as a senior financial modeler and promoted him three months later to modeling team lead. Plaintiff's claim of racial discrimination arose from Fannie Mae's failure to grant him a pay increase in connection with his promotion. He alleged that when he questioned Fannie Mae's chief audit executive concerning this issue, she replied: "For a young black man smart like you, we are happy to have your expertise; I think I am already paying you a lot of money." Noting that the executive denied making this statement, the court instructed that such a credibility contest cannot be resolved at the summary judgment stage against the non-moving party. Instead, it concluded that the "young black man" comment constituted direct evidence of racial bias that entitled plaintiff to a trial on the issue.

In reversing the grant of summary judgment on plaintiff's hostile work environment claim, the court cited both this comment and a subsequent incident in which a Fannie Mae vice president during a meeting on work assignments yelled at plaintiff, "Get out of my office n____." Addressing this latter event, the court suggested, "This single incident might well have been sufficient to establish a hostile work environment." It explained, "perhaps no single act can more quickly alter the conditions of employment" than "the use of an unambiguously racial epithet such as 'n_____' by a supervisor."

http://www.cadc.uscourts.gov/internet/opinions.nsf/5A1A6E0FFB5A980D85257B44004DF52C/$file/11-7127-1429152.pdf

In Locke v. Tom James Co., 2013 WL 1340841 (S.D.N.Y. March 25, 2013), the Court declined to dismiss claims by an employer seeking to enforce a two-year, 50-mile restrictive covenant. Judge Daniels denied summary judgment to the former employee, who was seeking dismissal of claims that he had breached the restrictive covenant and misappropriated trade secrets. The former employee worked as a clothier and salesman for a high-end custom clothing company.

The Court found that the customer list at issue was not publicly ascertainable, and noted that protecting customer relationships is especially important when employees work closely with customers over a long period of time, especially when the employee's services to the customers are significant. (Here, the former employee visited customers at their offices or homes.) The Court also concluded that a two-year duration and 50-mile radius were reasonable, and that the agreement was not obtained under duress.

(Thanks to WRR Committee member Steven T. Sledzik of Jones Morrison, LLP for this contribution!)

This case is discussed more fully in my posting of Nov. 11, 2012.

The Supreme Court handed down its decision on Apr. 16, 2013. The question presented, which the majority (Thomas, J., with Roberts, CJ, and Scalia, Kennedy and Alito, JJ) sidestepped, was whether a would be FLSA collective-action case becomes moot when the lone plaintiff receives an offer from defendants to satisfy all of the plaintiff's claims. The Court assumed, without deciding, that the plaintiff's individual claim was moot, even though the plaintiff had declined the Rule 68 offer of judgment and the district court had dismissed the case -- leaving her without any damages remedy. (It seems likely that the Second Circuit, like some other Courts of Appeal, would at least have entered a default judgment in her favor, thus granting her individual relief. See McCauley v. Trans Union, LLC, 402 F.2d 340 (2005).)
Based on its assumption, the Court held that because plaintiff had no remaining personal stake in representing others in the action, the suit as a whole became moot. Along the way, it distinguished a number of cases that had declined to find mootness in a class action setting, deeming these precedents inaposite in the FLSA context.

J. Kagan, joined by Ginsburg, Breyer and Sotomeyer, JJ, issued a scathing dissent. She accused the court of having rushed to decide the broader issue based on an invalid premise: that the individual case was moot. (Justice Thomas held that plaintiff had waived the argument on individual mootness by not raising it until her brief on the merits in the Court.) J. Kagan also noted: "No more in a collective action brought under the FLSA than in any other class action may a court, prior to certification, eliminate the entire suit by acceding to a defendant's proposal to make only the named plaintiff whole. That course would short-circuit a collective action before it could begin, and thereby frustrate Congress' decision to give FLSA plaintiffs 'the opportunity to proceed collectively.'" (citation omitted).

On Wednesday, January 23, 2013, the New York City Council passed a bill amending the City's Human Rights Law to prohibit employment discrimination based upon an employee or applicant's "unemployment status." It defines "unemployment status" as "an individual's current or recent unemployment." Under the amendment, however, an employer is not precluded from considering unemployment status data that is substantially job related where it has a bona fide reason for doing so. Nor is an employer barred from inquiring as to prior terminations or demotions, including whether such action was taken for cause.

The amendment also addresses the advertisement of job vacancies by proscribing the inclusion of any statement that being currently employed is a job requirement or that unemployed applicants will not be considered.

It has been reported that Mayor Michael Bloomberg plans to veto the bill. In response, City Council Speaker Christine Quinn was quoted saying that should Bloomberg veto it, she is confident she has the votes to override him.

http://legistar.council.nyc.gov/LegislationDetail.aspx?ID=1102958&GUID=9B3B9F98-4E30-475C-A813-F9E1C99F1D99&Options=ID%7cText%7c&Search=

The United States District Court for the Northern District of Illinois, in Quinlan vs. Elysian Hotel Company, No. 1:11-CV-05956 (N.D. IL 1/4/13), ruled that plaintiff may proceed with her Title VII claim alleging her discharge shortly after she returned from maternity leave constituted sex discrimination. In denying the employer's motion for summary judgment, the court concluded that remarks purportedly made to Quinlan by three management officials who participated in the decision to discharge her raised a genuine issue that their decision was influenced by sex discrimination. The remarks at issue concerned the difficulty of balancing work and being a good mother. The court described Quinlan's claim as asserting "the employer discriminated based on a view that new mothers cannot (or are less able to) do the job."

Acknowledging that certain of the cited comments were attenuated from the Quinlan's discharge having been made more than six months prior, the court found that the remarks attributed to Mary Beth Malone, one of Quinlan's supervisors and one of the three decision makers, standing alone constituted sufficient circumstantial evidence that discrimination may have influenced the decision to terminate Quinlan's employment. These included repeated inquiries as to how Quinlan was going to manage a baby and her workload, as well as recommending that Quinlan consider returning to her career "later in life" because of the difficulty of managing work and being a "good mom."

The court refused to accept for summary judgment purposes, Elysian's contention that Malone's comments were not discriminatory, but represented "girl talk" conversations in which Quinlan and Malone chatted about life as friends. It explained, "at this stage, the Court must view the evidence in Quinlan's favor, and when the content of the remarks are combined with the settings in which they were made, and the repetitiveness with which they were made, and that it was allegedly Malone who repeatedly brought up the subject, the remarks are evidence of discrimination."

http://il.findacase.com/research/wfrmDocViewer.aspx/xq/fac.20130104_0000026.NIL.htm/qx

Denying defendant's motion to dismiss, the United States District Court for the Southern District of Ohio in Chenzira vs. Cincinnati Children's Hospital Medical Center, 1: 11-CV-00917 (S.D. Ohio 12/27/12), found that plaintiff stated a plausible claim of religious discrimination under Title VII and the Ohio Civil Rights Act based upon her adherence to veganism. Chenzira alleged that the hospital violated her religious convictions by discharging her for refusing to receive the flu vaccine. She explained that receiving a flu shot would contravene her convictions as a vegan not to ingest any animal or animal by-products because the flu vaccine is grown in chicken eggs.

The court rejected defendant's argument that veganism represents nothing more than a dietary preference or social philosophy, and, as such, does not qualify as a religion for purposes of the protections afforded by Title VII or the Ohio Civil Rights Act. Instead, referencing the standard to be applied in the context of a motion to dismiss, the court concluded that it was "plausible" that Chenzira could subscribe to veganism with a sincerity equating that of traditional religious views, thereby satisfying the EEOC's definition. 29 C.F.R. §1605.1. It noted that this conclusion was further supported by Chenzira's citation to supporting essays and Biblical excerpts. "Although the Code makes it clear that it is not necessary that a religious group espouse a belief before it can qualify as religious, 29 C.F.R. §1605.1, the fact here that Plaintiff is not alone in articulating her view lends credence to her position."

The court also denied the hospital's motion to dismiss Chenzira's complaint as being untimely. Although Chenzira filed her formal charge with the EEOC beyond the 300-day limit, the court determined that the intake questionnaire that she completed at the EEOC prior to the expiration of that period was sufficiently detailed to satisfy the charge-filing requirement.

http://www.theemployerhandbook.com/ChenziraCincinnati.pdf

The Eighth Circuit, in Owen vs. Bristol Care, Inc., No. 12-1719 (8th Cir. 1/7/13), held that the plaintiff must arbitrate her Fair Labor Standards Act ("FLSA") overtime claim even though the governing mandatory arbitration agreement ("MAA") contained a waiver of class claims barring her proposed collective action.

Owen, a former administrator with Bristol Care, a nursing home operator, brought her FLSA action in federal district court on behalf of herself and other similarly situated current and former employees alleging that she and other administrators had been deliberately misclassified as "exempt" employees for purposes of FLSA and corresponding state laws. The district court denied Bristol Care's motion to compel arbitration in accordance with the MAA and the Federal Arbitration Act ("FAA"). The court reasoned that although the MAA encompassed Owen's claim, arbitration could not be ordered here because the inclusion of the class waiver in the MAA rendered it invalid. In so concluding, the court noted that the Supreme Court's decision in AT&T Mobility LLC vs. Concepcion, 563 U.S. __, 131 S.Ct. 1740 (2011), upholding a class waiver in a consumer arbitration agreement, was not controlling in the employment context. Citing Chen-Oster vs. Goldman Sachs & Co., 758 F.Supp. 2d 394 (S.D.N.Y. 2011) and D.R. Horton, Inc., 357 NLRB No. 184 (2012), it explained that class waivers are invalid in FLSA cases because the FLSA authorizes the bringing of a class action.

In reversing the district court, the Eighth Circuit instructed that Section 2 of the FAA "requires courts to enforce arbitration agreements according to their terms," absent a "contrary congressional command" in another statute overriding the FAA's mandate. It noted that the burden to make this showing rests with the party challenging the arbitration agreement.

Owen, the Eighth Circuit decided, failed to meet this burden. "Owen identifies nothing in either the text or legislative history of the FLSA that indicates a congressional intent to bar employees from agreeing to arbitrate FLSA claims individually, nor is there an 'inherent conflict' between the FLSA and the FAA. In short, the FLSA contains no 'contrary congressional command' as required to override the FAA."

The Eighth Circuit also highlighted that its conclusion is consistent with the five other courts of appeals that have addressed the issue. See Vilches vs. The Travelers Companies, Inc., 413 F. App'x 487 (3rd Cir. 2011); Caley vs. Gulfstream Aerospace Corp., 428 F.3d 1359 (11th Cir. 2005); Carter vs. Countrywide Credit Industry, Inc., 362 F.3d 294 (5th Cir. 2004); Adkins vs. Labor Ready, Inc., 303 F.3d 496 (4th Cir. 2002); Horentstein vs. Mortgage Market, Inc., 9 F. App'x 618 (9th Cir. 2001).

http://www.ca8.uscourts.gov/opndir/13/01/121719P.pdf

The EEOC has reported that Dillard's Inc., a national retail chain, agreed to pay $2 million and adopt company-wide policy changes to settle a class action disability discrimination lawsuit filed by the agency in 2008. The suit stemmed from Dillard's long-standing national policy of requiring employees to disclose personal and confidential medical information as a condition of being approved for sick leave. The settlement also disposes of claims that Dillard's violated the ADA by terminating a class of employees for exceeding their maximum sick leave.

Under Dillard's policy, employees were required to disclose the specifics of their medical condition when requesting sick leave even though they had provided a doctor's statement confirming that their absence was due to medical reasons. The EEOC maintained that the policy violated the ADA's prohibition against inquiring as to an employee's disability except where job-related and necessary for the conduct of business.

Commenting on the settlement, EEOC regional attorney Anna Park stated, "Policies and practices that permit medical inquiries without proof of a valid business necessity run afoul of the law, often having large-scale consequences. All employers should carefully examine their own policies and practices to ensure compliance with federal law."

http://www.eeoc.gov/eeoc/newsroom/release/12-18-12.cfm