WorkLawNY

A Southern District Bankruptcy Court in Poughkeepsie held attorneys for Wells Fargo Bank liable for sanctions for contempt of an order to mediate.http://www.nysb.uscourts.gov/cgi-bin/recent.pl The decision, In re A.T. Reynolds & Sons, Inc., a 32-page opinion by U.S. Bankruptcy Judge Cecelia G. Morris, concerned a report of a court-appointed mediator that Wells Fargo failed to participate in the mediation in good faith, citing the following reasons, among others: unreasonable insistence on recitation of issues to be mediated; failure to send representatives with full settlement authority; continual repetition of a "pre-conceived mantra that indicated that Wells Fargo was not open to any compromise that would involve 'taking a single dollar out of their pocket'; threatening the mediator that 'Wells Fargo would never agree to [his] acting as mediator in the future in which Wells Fargo might be a party.'" During the contempt hearing, the Court took affidavits, testimony, and examined the Mediator with respect to the procedural elements of the mediation but not discussion of the underlying substantive issues or merits. While the District Court was mindful of the Second Circuit decision, Negron v. Woodhull Hosp., No. 05-4147-CV, 2006 WL 759806 (March 23, 2006) that stands for the proposition that "a court cannot compel the parties to settle," Judge Morris concluded that "attendance without active participation is insufficient to constitute good-faith participation in mediation." Finding that mediation is a process "controlled by the Mediator," in which "risk-analysis" and "discussion" are essential elements, Judge Morris held that "where a party is ordered to participate in mediation, the party fails to comply with the order when it does not engage in the process of mediation, which entails consideration of the other parties' arguments." In short, "Wells Fargo was directed to participate in mediation, not sit as its own judge and jury in an off-the-record proceeding." She ordered Wells Fargo and its outside counsel to bear the costs of all parties to the mediation. Whether this decision stands on reconsideration or appeal, it should be read by all mediators and counsel who participate in court-annexed mediations for a thorough discussion of "do's and don'ts" in mediation advocacy.

On February 17, 2010, the Second Circuit held that an employee could not be judicially estopped from asserting a disability discrimination claim based on contradictory representations made on applications for disability benefits. DeRosa v. Nat’l Envelope Corp., No. 08-2562 (2d. Cir. Feb. 17, 2010).

Defendant employer is a paper manufacturer. Plaintiff was responsible for quoting prices to customers and processing orders. After a severe leg injury in 2002, the company allowed him to work from home by using his computer, phone and fax machine. However, in October 2004, the company rescinded the accommodation, and terminated the plaintiff when he refused to return to work. Plaintiff filed for Social Security and New York State disability benefits. On his benefits applications he stated that he could not “write, type, sit, stand, walk & lift, reach, grab, bend,” and that pain prevented him from engaging in social activities via phone or computer.

Plaintiff brought suit against his employer alleging that he was terminated in violation of the Americans With Disabilities Act. The district court granted summary judgment to the employer, holding that the plaintiff was judicially estopped from arguing that he could perform the essential functions of his job with reasonable accommodation because he had stated on his disability benefits applications that pain prevented him from using the phone or computer and, thus, he was unable to establish an essential element of his ADA claim. However, the Second Circuit reversed, holding that judicial estoppel only applies where the statements are “clearly inconsistent,” and that theoretically plaintiff’s statements could be reconciled. For example, the plaintiff might have explained the apparent discrepancy by saying that he was willing to endure the pain associated with phone and computer use in order to keep his job, but not for optional social activities. The court emphasized that the ADA and disability benefits laws have different definitions of “disability,” and that the statements the plaintiff made on the benefits applications were in response to questions about his social activities, not necessarily his ability to perform the essential functions of his job.

This post was authored by Matt Lampe with the assistance of Emilie Hendee.

On February 5, 2010, Governor David Paterson nominated Colleen Crawford Gardner to be New York State Commissioner of Labor. The position was left vacant after the United States Senate confirmed Patricia Smith as United States Solicitor of Labor. Gardner had been speculated to be the frontrunner to fill Smith's position. Prior to her nomination, Gardner served as the Associate Commissioner for Labor Affairs in the State Department of Labor and reported directly to Smith. Before taking on that position in March 2007, Gardner spent 23 years working for the AFL-CIO, most notably as the Director of Organizing and Community Services.

Gardner is serving as acting Commissioner and will continue to do so until the New York State Senate votes on her nomination. Since beginning her tenure on February 5, Gardner has already issued a statement at Governor Paterson's request in response to a WARN notice received from a Rome, New York company that sets forth a potential plan of action involving retraining, providing unemployment benefits and securing new jobs for laid off workers. Acting Commissioner Gardner's statement is available at: http://www.labor.ny.gov/pressreleases/2010/Feb11_2010.htm.

You can view the Governor's press release on Gardner's nomination at http://www.labor.ny.gov/pressreleases/2010/Feb05_2010_2.htm.

This post was authored by Matt Lampe with the assistance of Kristina Yost.

Under New York’s Education Law, probationary teachers must be given written notice at least 30 days prior to the effective date of termination (or at least 60 days prior to the expiration of the teacher’s probationary period). In Vetter v. Board of Education, decided February 11, 2010, the New York State Court of Appeals was asked to determine whether a monetary remedy was available for a terminated probationary teacher who was not given such notice. The Board admitted it failed to follow the law’s requirements, giving the petitioner only two days’ notice, but contended “that a compensation remedy is inappropriate because the 28 days fell during summer vacation, a period when petitioner would not have been paid any salary had he received timely notice.” The Court rejected the Board’s argument and concluded, relying on its 1993 ruling in Tucker v. Board of Education [82 N.Y.2d 274], that teachers are entitled to “one day’s pay for each day the notice was late.”

On Tuesday, February 9, 2010, a Republican-led filibuster blocked the appointment of Craig Becker, a union lawyer for the AFL-CIO and SEIU, to the National Labor Relations Board. Supporters of Becker urge President Obama to make appointment while Congress is in recess this month. For more, see GOP Blocks Obama Labor Board Nominee (New York Times, 2/9/10) and Unions Push White House to Appoint Becker (Wall Street Journal, 2/11/10).

In Rohn Padmore, Inc. v. LC Play Inc. d/b/a/ LaQue Clothing, No. 06 Civ. 0498(PKL), 2010 WL 93109 (S.D.N.Y. Jan. 11, 2010), Judge Peter Leisure held that an employee can assert a claim for discrimination based on perceived sexual orientation under the New York State Human Rights Law and New York City Human Rights Law and, further, held that an employee who lives and works outside of New York can assert these claims. Plaintiff, who lived and worked in California and was employed by a New York clothing manufacturer, allegedly received an e-mail informing him of his termination. Plaintiff claimed to receive a subsequent e-mail from the account of the company’s owner stating that “reason for your termination was because of the image of my company. The models and other people had questions about your sexuality and my company can’t afford to [be] attached to no gay . . .”

First, Judge Leisure examined the text of both the NYSHRL and NYCHRL, as well as the legislative history of the NYSHRL, and concluded that both statutes protected against discrimination based on “perceived” sexual orientation, regardless of the employee’s actual sexual orientation. Second, Judge Leisure analyzed the geographic scope of the NYSHRL and NYCHRL. The opinion discussed, at length, the split within the Southern District as to whether a nonresident plaintiff bringing suit under the NYSHRL or NYCHRL must also demonstrate that the discriminatory act had an impact in either New York City or State. Judge Leisure agreed with the more recent cases, and held that the NYSHRL and the NYCHRL apply “when a discriminatory act is committed in New York, even if the impact of that act is felt outside of New York.”

This post was authored by Matt Lampe with the assistance of Erin Dittus.

Retaliation claims in the Second Circuit will be governed by the U.S. Supreme Court's decision in Burlington Northern & Santa Fe Railway Co v. White, 548 U.S. 53 (2006) and not under the more stringent tests in Second Circuit decisions, Williams v. R.H. Donnelly, 368 F.3d 123, 128 (2d Cir. 2004) and Galabya v. N.Y. City Bd of Educ., 202 F.3d 636 (2d Cir. 2000), which "no longer represent the state of the law," according to the decision Hicks v. Baines, No. 06-3782-cv (Feb. 2, 2010). Circuit Judge Jacobs affirmed a grant of summary judgment in part, and remanded in part, ruling that under Burlington Northern, that acts of workplace sabotage and punitive scheduling could constitute "adverse employment actions," since they could "well dissuade a reasonable worker from making or supporting a charge of discrimination," regardless of whether the adverse action is tied to a term or condition of employment. In this case, since plaintiffs worked in secure residential facilities where safety concerns are paramount, a plaintiff might well be dissuaded from participating in a workplace investigation if he could be retaliated against by being assigned to a less safe or more threatening workplace.

On February 4, 2010, the Third Department decided Carr v. New York State Department of Transportation (DOT), concluding that the disciplinary procedure set forth in a union contract was inapplicable where an employee’s off-duty conduct resulted in his no longer possessing the minimum qualifications for the job he was hired to perform. In Carr, DOT terminated Plaintiff James Carr, a Highway Maintenance Worker, after an off-duty alcohol related driving offense resulted in the revocation of Carr’s commercial driver’s license (CDL). DOT argued that possession of a CDL was a minimum qualification for Carr’s position and that his failure to have a valid CDL was ground for dismissal. But DOT failed to follow Carr’s collective bargaining agreement which sets forth a disciplinary procedure applicable to employee incompetency or misconduct and is expressly “in lieu of the procedure specified in Civil Service Law [§] 75." Carr’s union argued that his failure to possess a valid CDL amounted to “incompetency” requiring DOT to follow contractual procedures but the Third Department disagreed, finding instead that failing to possess a valid CDL is not a disciplinary matter. Rather, it held that failure of an employee to hold a valid commercial driver’s license (CDL) “renders him unqualified for the position of [highway maintenance worker]based upon his off-duty conduct, which is unrelated to any deficient job-related performance, misconduct or lack of competency on his part.” Thus, DOT was not required to follow contractual procedures. The fact that DOT afforded Carr an opportunity to present documentation that he possessed a valid CDL after giving him written notice it believed he no longer possessed the minimum qualifications for his job was sufficient due process.

In a summary order issued on February 2, 2010, the Second Circuit upheld the firing of an employee who accessed sexual materials on the internet while at work. In Pacenza v. IBM (09-CV-2025), Plaintiff alleged he was fired because of his age and his disability. IBM argued it fired Plaintiff, then 54 years old, in 2003 on the grounds that he violated certain IBM policies regarding internet abuse. According to Plaintiff, the real reason for terminating him was “because of his disability, Post Traumatic Stress Disorder (‘PTSD’), and his age. He contends that his condition manifests itself in a variety of addictive disorders, including a compulsion to access sexually-oriented material on the internet.” The Court rejected Plaintiffs’ arguments and affirmed the district court’s granting of summary judgment for IBM, reasoning:

Because Plaintiff did not adduce evidence that his supervisor had knowledge of his disability, he failed to make a prima facie showing of discrimination under the ADA [citation omitted]. Moreover, even if Plaintiff had established a prima facie case, he nonetheless failed to satisfy his burden of persuasion to overcome summary judgment by producing evidence ‘that would tend to show that the proffered reason [for termination] was merely a pretext for discrimination’ [citation omitted]. Plaintiff’s conduct was a clear violation of IBM’s policies, and we see no reason to conclude that Plaintiff was singled out or treated more harshly than similarly situated non-disabled employees who violated those policies [citation omitted].

Finally, the district court was correct in granting summary judgment to IBM on Plaintiff’s age discrimination claim. Plaintiff failed to demonstrate that he was terminated on account of his age, instead of his accessing a sexually-oriented chat room on his work computer. The mere fact that Plaintiff’s work duties were partially assumed by younger individuals following his termination was insufficient to survive summary judgment [citation omitted]. Because Plaintiff did not satisfy his burden of persuasion under the ADEA his claims were properly dismissed.

On January 27, 2010, in Weintraub v. Board of Education (07-CV-2376), the U.S. Court of Appeals for the Second Circuit found the filing of a grievance by a New York City public school teacher was not protected speech since it “was in furtherance of one of his core duties as a public school teacher, maintaining class discipline, and had no relevant analogue to citizen speech.” Interpreting the U.S. Supreme Court’s 2006 decision Garcetti v. Ceballos, 547 U.S. 410, the Second Circuit joined five other circuits when it concluded that “under the First Amendment, speech can be ‘pursuant to’ a public employee’s official job duties even though it is not required by, or included in, the employee’s job description, or in response to a request by the employer.” Applying this viewpoint to Weintraub, the Court explained, in part:

The lodging of a union grievance is not a form or channel of discourse available to non-employee citizens, as would be a letter to the editor or a complaint to an elected representative or inspector general. Rather than voicing his grievance through channels available to citizens generally, Weintraub made an internal communication made pursuant to an existing dispute-resolution policy established by his employer, the Board of Education [citation omitted]. As with the speech at issue in Garcetti, Weintraub could only speak in the manner that he did by filing a grievance with his teacher’s union as a public employee [citation omitted]. His grievance filing, therefore, lacked a relevant analogue to citizen speech and “retain[ed no] possibility” of constitutional protection [citation omitted].