Connecticut Employment Lawyer & Attorney : Daniel Schwartz : Stamford, Hartford New Haven, CT

Attorneys can go months -- if not years -- without Supreme Court guidance on employment law issues. But today, the Supreme Court issued its second employment-law related decision in as many days.

However, for the second day in a row, the Supreme Court issued a decision that, at the end of the day, isn't really about employment law at all, but something else. In today's opinion, the Supreme Court really examined what type of deference  should be afforded to the EEOC in construing the federal statutes about what is a "charge" of discrimination under ADEA (the federal age discrimination statute).

In Federal Express v. Holwecki, the Supreme Court -- by a 7-2 margin -- decided the issue is what constitutes a "charge" of discrimination submitted to the Equal Employment Opportunity Commission under the Age Discrimination in Employment Act before plaintiff can institute a private lawsuit. Here, the Court found that the EEOC had some regulations and internal directives on the subject and is therefore entitled to some "measure of respect" as to what constitutes a charge.  It also provided that the EEOC acted reasonably in interpreting an intake questionnaire as a "charge".  

Workplace Prof has his early thoughts too and a general discussion of the case.

The case's outcome is good on two levels for employment discrimination plaintiffs. First, it allows these Fed Ex plaintiffs to get to the substance of their complaint and second, it will force the EEOC to come out with clear regulations on what counts as a "charge" in the future so the parties are able to structure their future conduct accordingly and not be prejudiced by a shifting rules.

And finally, I have to say that this well-reasoned majority opinion restores my faith somewhat that this court is not completely in the bag for employer interests. Not completely.

A few months ago, in a post entitled "'Supreme Court to Decide Age Discrimination!'" Is This Important To Employers in Connecticut",  I indicated that for employers in Connecticut, this case would not amount to much.  And since its not often an attorney gets to say, "I told you so", I'll just let my prior post speak for itself.

[For] employers and HR professionals, there is a remaining question that has not yet been answered so far: "Should we worry about this employment law case?" The answer is: Not that much.

For Title VII and ADA cases, this case will have no real impact. In those types of cases, an employee who wants to sue in federal court must first get a right to sue letter from the EEOC. For those cases, an employee's charge must be processed in a meaningful fashion.

ADEA (age discrimination) plaintiffs do not face a similar hurdle; rather the charge must simply be filed and the employee must simply wait 60 days before filing a federal claim; no right to sue letter is needed. Thus, the concern expressed by FedEx and by the U.S. Chamber of Commerce in their amicus brief, that employers may not receive the same type notice of ADEA claims, is certainly possible. In Holowecki, FedEx's problems were compounded by the EEOC's admitted failure to follow statutorily mandated procedures to notify the the employer of the complaint.

As a practical matter, nearly all of the ADEA claims filed, particularly in Connecticut, are handled in the normal course of business -- that is, that the employee files a discrimination charge, and the employer is notified of that charge. Even if the EEOC only fills out an intake questionnaire, the EEOC is mandated to followup on it typically.

Connecticut, which has a work-sharing agreement with the EEOC to process EEOC charges that are cross-filed in the state, goes one step further. The CHRO will send out notices to employers upon receipt and initial processing of an age discrimination suit. Thus, as a practical matter, it is highly unlikely that an employer in Connecticut will not get notice of the charge. Because virtually all discrimination charges are filed in the normal course of business, the situation that arises in Holowecki is simply not likely to repeat itself with any frequency, particularly within Connecticut.

For that reason, a Supreme Court's decision in Holowecki -- while perhaps interesting in a "technical" way -- is not likely to have any significant impact for employers in Connecticut. Unless the Supreme Court deviates from its typical path and sets forth new criteria for handling such claims, the case ultimately may be newsworthy only to employment law bloggers such as myself.

And in fact, the Supreme Court did not deviate from its expected path.  The court found that although the employer had good reason to complain about the way the EEOC treated the matter, it was not entitled to a decision in its favor. Ultimately, the Supreme Court warned, the EEOC and other agencies are responsible for cleaning up their regulations and practices:

Here, because the agency failed to treat respondent’s filing as a charge in the first instance, both sides lost the benefits of the ADEA’s informal dispute resolution process.

The employer’s interests, in particular, were given short shrift, for it was not notified of respondent’s complaint until she filed suit. The court that hears the merits of this litigation can attempt to remedy this deficiency by staying the proceedings to allow an opportunity for conciliation and settlement. True, that remedy would be imperfect.  Once the adversary process has begun a dispute may be in a more rigid cast than if conciliation had been attempted at the outset.

This result is unfortunate, but, at least in this case, unavoidable. While courts will use their powers to fashion the best relief possible in situations like this one, the ultimate responsibility for establishing a clearer, more consistent process lies with the agency.

Justice Thomas - fresh off of being in the majority in yesterday's decision -- writes a dissent that basically mocks the majority for its failure to outline any real standards in the case:

Today’s decision does nothing— absolutely nothing—to solve the problem that under the EEOC’s current processes no one can tell, ex ante, whether a particular filing is or is not a charge. Given the Court’s utterly vague criteria, whatever the agency later decides to regard as a charge is a charge—and the statutorily required notice to the employer and conciliation process will be evaded in the future as it has been in this case. The Court’s failure to apply a clear and sensible rule renders its decision of little use in future cases to complainants, employers, or the agency.

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After a long day of taking depositions on Tuesday, there's nothing like coming back to my computer with dozens of e-mail messages and hundreds of posts to read on the RSS feeds.  And, when I saw that the U.S. Supreme Court decided an employment law case, my brain got excited for a brief moment (and frustrated that I spent a day sitting in a conference room).

After all, when "The Nine" (good book by the way) speak, SURELY they must have something important to say. 

But alas, the decision issued on Tuesday by the Court is a let down. Don't get me wrong, I expected the results (though did not go into length about it as the Workplace Prof did), but I was hoping for something more dramatic than the nine-page, unanimous, color-by-numbers and connect-the-dots decision by Justice Thomas.

The SCOTUS Blog has, as usual, the most concise summary about the case, Sprint/United Management v. Mendelsohn.

[The Supreme Court] overturned a federal appeals court ruling on how courts are to treat ”me too” evidence — workplace discrimination testimony by workers other than the one raising a job bias claim.  In a unanimous decision, written by Justice Clarence Thomas, the Court found the Tenth Circuit Court in error in deciding on its own, without remanding to a trial judge, that such evidence is admissible.

Federal rules, the Court said, “do not make such evidence per se admissible or per se inadmissible.” It is up to District Courts, in trying job bias cases (here, an Age Discrimination in Employment Act case), to sort out the fact-intensive nature of such evidence. “Whether evidence of discrimination by other supervisors is relevant in an individual ADEA case is fact based and depends on many factors, including how closely related the evidence is to the plaintiff’s circumstances and theory of the case,” the opinion said.

Since other employment law bloggers have already dissected what's left of the decision, perhaps its best to let them start to summarize the case.  Here's the rundown:

• Michael Fox at Jottings by an Employer's Lawyer calls it "[T]he equivalent to a judicial mulligan"
• Law Memo says the case "was not so much an employment law case as it was an evidence case. It turned on the proper role of the trial courts versus the appellate courts in applying the Federal Rules of Evidence."
• Michael Moore, at the Pennsylvania Employment Law Blog indicates that the true issue that will be at the forefront of the practice is whether employees are "similarly situated" to the employee who has brought the suit.
  
• Workplace Prof indicates that there is "dicta" language (which for non-lawyers out there means "non-binding") in the opinion that should be watched and calls the decision "a moral victory for ADEA plaintiffs."
• Jon Hyman, at Ohio Employer's Law Blog, has another good analysis in which he states, "This decision makes a lot of sense. It skirts the ultimate issue of whether "me, too" evidence is admissible or inadmissible because that decision should be fought in the trial court, which is in the best position to examine the evidence and weigh its relevance and admissibility." 
  
• The Laconic Law Blog also finds the Court's decision unsatisfying and says the "opinion leaves many questions about the admissibility of so-called “me-too” evidence unanswered."
• Not to be outdone, John Phillips at The Word on Employment Law, stated that the case the Court "decided today was hyped, but the Court’s decision didn’t deliver on the hype. Of course, the Court wasn’t hyping it." John closes by hoping that "Maybe the next decision will bring more excitement with it."
• Perhaps Will Schendel, of Alaska Employment Law Blog had it right when he didn't even waste time analyzing the case and said the equivalent of "ditto" to the analysis of the Workplace Prof. 

For employers, though, the question remains -- what's the practical takeaway from this decision?

In my view, nothing. The Supreme Court's decision, in essence, is just telling lower courts that sometimes evidence of discrimination of other employees is admissible. And sometimes it isn't.  For employers making employment law decisions, this case will have no effect on how it will treat its employees.  After all, employers don't go into a day thinking -- "hey, I'll treat Bob nice because if I don't, then Jim is going to use how I treated Bob as evidence in his own discrimination case".

The words of wisdom spouted by others remain true today: Treat employees fairly and it will nearly always reduce the risk of lawsuits and liability. 

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Nothing like a U.S. Supreme Court case on employee benefits to get the blogs to come alive.  And yet, for some reason, I've had difficulty getting exciting about a case decided this week.

First, for those whose kids have been on vacation this week, a recap from Michael Moore of Pennsylvania Employment Law Blog.

The United State Supreme Court ruled that ERISA allows individual claims by plan participants for breach of fiduciary duty that result in losses to an individual account rather than only to the entire plan. In LaRue v. DeWolff, Boberg, & Assoc., Inc., an employee brought an ERISA claim against his employer who was the plan administrator of a 401k plan. The employee claimed $150,000 in losses to his 401k account caused by his the failure to make the changes the employee directed in the investments held in his account. The employee claimed that the failure to make the changes was a breach of fiduciary duty under ERISA. The Court noted the change in the retirement plan landscape from defined benefit plans to defined contribution plans necessitates the recovery of fiduciary breaches in a participant’s individual account. The Court did not decide whether the employer breached its fiduciary duty.

But will this lead to a slew of meritless lawsuits, as some predict? Count me in the group as "not yet convinced" and still puzzled whether this will truly impact 401(k) administration. 

Why? Because while the court did open the door to more lawsuits -- probably on a  breach of fiduciary duty claim -- on an individual basis, the standard for proving such lawsuits remains the same and still high. Without being too technical, a participant in a breach of fiduciary duty case needs to show, for example, that the plan did not discharge its duties with the same "care, skill, prudence, and diligence" that a prudent person would use under similar circumstances.

In the LaRue case, the court didn't even decide whether the plan acted prudently or not, since it sent the case back down.  But I believe the facts alleged seemed so outrageous (plan refuses to abide by participants instructions) that the court couldn't turn a blind eye to an outcome that would allow the plan to avoid liability entirely.

Stephen Rosenberg of Boston ERISA & Insurance Litigation Blog raises some other head-scratching questions:

Does the majority’s heavy emphasis on the fact that LaRue concerned a defined contribution plan hint at a belief among the majority that, in fact, ERISA needs to be treated as an organic, evolving body of law that needs to shift from its past precedents to account for the rise of defined contribution plans? And if so, is the emphasis on this point in the majority’s opinion a subtle suggestion to lower courts to approach new issues brought before them concerning defined contribution plans - or even old issues never before resolved under defined contribution plans - with an eye to how ERISA should develop to fit those types of plans?

These are, to be sure, interesting and noteworthy points worth debating in the intellectual discourse about the case.

However, from a practical perspective, I'm not sure much will change for 401(k) plan administrators. They have had to act and should continue to act prudently in administering the plan.  If anything, they should recognize that their decisions may be under more of a microscope than in the past. But for those plan administrators who have always acted under a microscope and been cautious in their decision-making processes, the LaRue decision isn't going to change the way they act.

So, let others debate whether individual lawsuits under 401k are a good or a bad thing. While they are doing that, employers can refocus their efforts to make sure that their 401k is being properly administered either by them or a company hired to make such decisions.

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As with other U.S. Supreme Court cases this term, there's been more virtual ink spilled this week over two oral arguments scheduled for the U.S. Supreme Court this week that will examine some of the parameters of  when it is illegal for an employer to retaliate against an employee for complaining about discrimination.  For most employers, however, these cases may not have nearly the practical impact that some commentators seem to suggest.

I'll leave it to others, such as Ross's Employment Law Blog to explain the cases. 

• In Gómez-Pérez v. Potter, to be argued today, the question for the court is whether for federal employees, the ADEA prohibits retaliation for filing an EEO complaint.  ADEA already prohibits retaliation by private employers.  Even if the U.S. Supreme Court decides that the statute does not explicitly cover retaliation claims by federal employees, it is hard to imagine that Congress would not take up this issue immediately with bi-partisan support.
• In CBOCS West, Inc. v. Humphries , to be argued tomorrow, February 20th, the question for the court is whether 42 U.S.C. Sec. 1981 (which prohibits race discrimination in the "making, performance, modification, and termination of contracts...") provides a cause of action for retaliation as well.   However, as readers are no doubt aware, Title VII already prohibits retaliation on the basis of race, so there is and has always been some overlap between the two claims. 

Emily Bazelon, over at Slate, suggests that this is a "Big Discrimination Case."  Unless the decision's rationale is broad, that seems to be an overstatement at this point.  Most discrimination and retaliation claims, as a practical matter, are brought under Title VII, not Section 1981.  Indeed, the only reason the Humphries case is not a Title VII claim is that the Plaintiff missed the statute of limitations.  Section 1981 mostly gets used when an employee bringing a retaliation or discrimination claim misses that deadline.  Thus, even if the court were to rule against the employee in this case, it will have no impact on the vast majority of race retaliation cases out there that are being filed under Title VII.

Jon Hyman, at Ohio Employer's Law Blog, has some additional thoughts on the Humphries case as does Workplace Prof.  A decision on these cases is expected by June 2008.

For employers in Connecticut, I would ignore the hype about these cases.  Retaliation against employees for filing race and age discrimination claims would still violate state law, under Conn. Gen. Stat. 46a-60(a)(4).  Regardless of how the Supreme Court decides, state law will continue to apply.  If and when an employee claims discrimination at the workplace, take steps to avoid a retaliation lawsuit, and don't worry about whether federal or state law will ultimately apply. 

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There's been a lot of good material this week and there just isn't time for full-fledged posts on each of them. But check these other posts for some additional information or background on various employment-law topics that may have an impact in Connecticut.

• The Word on Employment Law has a good alternative take on the Tribune Company's new employee handbook that I posted on yesterday.  Ultimately, I don't think John and I differ that much -- keeping handbooks readable to employees (and avoiding unnecessary legalese such as "whereas" or "notwithstanding the foregoing") is an important goal in any drafting exercise.  But making sure that your handbook doesn't confuse your employees or send your employees mixed messages is just as important as well.  The Ohio Employer's Blog has also added some insight too. 
  
• Overlawyered refers to a New York Times article over the weekend about the unintended consequences of the Americans with Disabilities Act.
• Ross' Employment Law Blog  talks about the decision late last week by U.S. Supreme Court' to take on three new employment law and ERISA cases this term.  The cases will address issues such as: "Is cooperating with internal investigation protected activity" and "Which party has burden of persuasion in establishing 'reasonable factors other than age.' under the ADEA."  It will also address the ERISA question of what standard of review should apply where a plan administrator both decides claims and pays claims.  Ohio Employer's Blog also chimes in on the subject as does the Workplace Prof. 
  
• Workplace Horizons reports on a potential new Microsoft program that would take employee monitoring to a whole new level.  A patent application by Microsoft describes a system of components that would use various "physiological or environmental sensors to detect at least one of heart rate, galvanic skin response, EMG, brain signals, respiration rate, body temperature, movement, facial movements, facial expressions, and blood pressure.”
• And finally, there was this amusing article from the BBC which asks the question: Why Do U.S. Pickets Walk in Circles? (H/T Workplace Prof.)  Apparently, union workers strike differently over the big pond.
  

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The U.S. Supreme Court this afternoon granted certiorari to an important question under the Americans with Disabilities Act, namely whether disabled employees must be reassigned to a vacant position for which they are qualified or merely be permitted to apply for such a position.

In Huber v. Walmart, the Eighth Circuit held for the employer in concluding that:

the ADA is not an affirmative action statute and does not require an employer to reassign a qualified disabled employee to a vacant position when such a reassignment would violate a legitimate nondiscriminatory policy of the employer to hire the most qualified candidate. ... Thus, the ADA does not require Wal-Mart to turn away a superior applicant for the router position in order to give the position to Huber. To conclude otherwise is “affirmative action with a vengeance. That is giving a job to someone solely on the basis of his status as a member of a statutorily protected group.” [citation omitted]

Here, Wal-Mart did not violate its duty, under the ADA, to provide a reasonable accommodation to Huber. Wal-Mart reasonably accommodated Huber’s disability by placing Huber in a maintenance associate position. The maintenance position may not have been a perfect substitute job, or the employee’s most preferred alternative job, but an employer is not required to provide a disabled employee with an accommodation that is ideal from the employee’s perspective, only an accommodation that is reasonable.

The SCOTUSBlog, as usual, has the particulars including the opinion below, the petition for certiorari and the brief in opposition. Expect more analysis to come.

UPDATE: Oral argument is likely to be held in March 2007, with a decision by the end of the term in June 2007.

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Last week, lots of virtual ink was spilled on the U.S. Supreme Court's arguments in Federal Express v. Holowecki which has been labeled as a noteworthy age discrimination claim, following in the shoes of the Supreme Court's ruling in Ledbetter in the spring.  Several blogs have good summaries of what happened, including: LawMemo, Ohio Employer's Law Blog, and the New Jersey Employment Law Blog. 

What's the issue before the Supreme Court? The issue is what constitutes a "charge" of discrimination submitted to the Equal Employment Opportunity Commission under the Age Discrimination in Employment Act before plaintiff can institute a private lawsuit.   From the oral argument and the reports on the case, it appears likely that the court will find that the EEO's use of an intake questionnaire may be a "charge". 

All very well and good, but for employers and HR professionals, there is a remaining question that has not yet been answered so far: "Should we worry about this employment law case?" The answer is: Not that much.

For Title VII and ADA cases, this case will have no real impact. In those types of cases, an employee who wants to sue in federal court must first get a right to sue letter from the EEOC. For those cases, an employee's charge must be processed in a meaningful fashion.

ADEA (age discrimination) plaintiffs do not face a similar hurdle; rather the charge must simply be filed and the employee must simply wait 60 days before filing a federal claim; no right to sue letter is needed. Thus, the concern expressed by FedEx and by the U.S. Chamber of Commerce in their amicus brief,  that employers may not receive the same type notice of ADEA claims, is certainly possible. In Holowecki, FedEx's problems were compounded by the EEOC's admitted failure to follow statutorily mandated procedures to notify the the employer of the complaint.  

As a practical matter, nearly all of the ADEA claims filed, particularly in Connecticut, are handled in the normal course of business -- that is, that the employee files a discrimination charge, and the employer is notified of that charge.  Even if the EEOC only fills out an intake questionnaire, the EEOC is mandated to followup on it typically. 

Connecticut, which has a work-sharing agreement with the EEOC to process EEOC charges that are cross-filed in the state, goes one step further. The CHRO will send out notices to employers upon receipt and initial processing of an age discrimination suit.  Thus, as a practical matter, it is highly unlikely that an employer in Connecticut will not get notice of the charge.  Because virtually all discrimination charges are filed in the normal course of business, the situation that arises in Holowecki is simply not likely to repeat itself with any frequency, particularly within Connecticut. 

For that reason, a Supreme Court's decision in Holowecki -- while perhaps interesting in a "technical" way -- is not likely to have any significant impact for employers in Connecticut.  Unless the Supreme Court deviates from its typical path and sets forth new criteria for handling such claims, the case ultimately may be newsworthy only to employment law bloggers such as myself.

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