Wednesday, November 16, 2016

7th Cir. Allows EMTs' Retaliation Claims to Move Forward Under Failure-to-Hire Despite Never Having Applied for New Positions

The facts of this case are initially confusing, but essentially, the plaintiffs, Shannon Volling and Allen Springer, worked at EMTs for a company called Metro and its contractor, a former defendant in the case, ARS.

In April 2011, Volling filed charges against ARS and Metro with the EEOC, alleging sexual harassment, discrimination and retaliation.   In July 2011, Volling filed a complaint in the Northern District of Illinois against ARS and Metro, alleging sex discrimination and misconduct in violation of the Emergency Medical Services Act.  In late 2011, Springer filed a supporting declaration in Volling's lawsuit against ARS and Metro.  Rolling also aided the Illinois Department of Public Health's investigation into ARS.  Like Volling, Springer also voiced his concerns at both ARS and Village of Antioch meetings.  Both plaintiffs alleged that ARS began acting against them immediately after they filed the lawsuit and declaration.

The retaliation at issue on appeal before the 7th Circuit stated on June 15, 2012.  ARS terminated its subcontract with Metro and all eight daytime, weekday Metro EMTs.  ARS replaced Metro with defendant Kurtz.  The next day, Kurtz began exclusively hiring former Metro EMTs.  Kurtz did not publicize its EMT vacancies or inform plaintiffs about them.  ARS instructed every former Metro EMT--except plaintiffs--on how to apply for employment under the new Kurtz contract.  Kurtz then asked ARS for the former Metro EMT's contact information to schedule interviews.  Neither plaintiff received application instructions, applied, or interviewed for a Kurtz EMT position.  Within one day, ARS and Kurtz allegedly "jointly" rehired every other Metro EMT except the plaintiffs.

Plaintiffs' Retaliation Claim

In June 2014, the plaintiffs filed suit against ARS and Kurtz, bringing state and federal retaliation claims.  The plaintiffs settled with ARS and Kurtz filed a motion to dismiss the plaintiffs' complaint.  In March 2015, the district court granted Kurtz's motion to dismiss, holding that the plaintiffs had failed to exhaust administrative remedies as required under Title VII and that regardless, plaintiffs failed to adequately state a claim for relief, as they did not apply for employment with Kurtz.

The plaintiffs filed an amended complaint and the district court again dismissed the complaint, with prejudice, finding that the plaintiffs failed to establish an adverse employment action under Title VII and the accompanying state law because they did not formally apply for employment with defendant Kurtz.

Retaliation Under Title VII

Title VII prohibits discriminating against an employee "because [she] has made a charge, testified, assisted, or participated in any manner in an investigation, proceeding, or hearing..."  To prevail under a Title VII retaliation claim, a plaintiff must "present evidence of (1) a statutorily protected activity; (2) a materially adverse action taken by the employer; and (3) a causal connection between the two."

In this case, the court held that is was undisputed that the plaintiffs engaged in protected activity and that what was disputed were the last two elements.

Materially Adverse Employment Action

The plaintiffs alleged that Kurtz refused to hire them in retaliation for their engaging in protected activity against ARS and Metro.  In the "failure to hire" context, a plaintiff satisfies the materially adverse employment action by showing she "(1)...engaged in a statutorily protected activity; (2) ...applied and had the technical qualifications required for the...position; (3)...was not hired for the position; and (4) a similarly situated individual who did not [engage in statutorily protected activity] was hired for the position."  The court held that it is undisputed that the plaintiffs satisfied these elements but the question remained whether their failure to apply for the position with Kurtz, because they were not informed about the position, is fatal to their retaliation claim.  For obvious reasons, the court held that this was not fatal and that the plaintiffs pled an adverse employment action against Kurtz deposit not applying for the EMT positions.

The court noted that McDonnell Douglas is not inflexible and recognized that the facts will vary in Title VII cases.  In cases such as this, the court held, the employer's "manner" of publication may involve the discriminatory absence of publication.  "Thus, plaintiffs' failure to apply stemmed from the very discriminatory practice they complain of, and their failure to apply need not bar their retaliation claims."  Kurtz had EMT openings and relied exclusively on ARS for referrals.  The two companies allegedly "jointly" refused to inform plaintiffs of the new EMT positions, while informing all other former Metro EMTs who had not engaged in protected activity.  No application is necessary in such circumstances, the court held.

Causal Connection

The lower district court also concluded that the plaintiffs failed to allege a causal connection between Kurtz's adverse employment action and their protected activity.   The Court held that an application is unnecessary when a plaintiff can show she would have applied had it not been for the complained-of-discriminatory practices.  In this case, plaintiffs contend Kurtz's alleged retaliatory discrimination--purposefully failing to inform plaintiffs of the new hiring process--caused plaintiffs' failure to apply.  Under the complaint, plaintiffs engaged in protected activity, and Kurtz was allegedly aware of this activity as ARS and Kurtz jointly retaliated against plaintiffs for this activity by intentionally excluding them from the EMT application process.

The 7th Circuit reversed and remanded the plaintiffs' retaliation claim to the district court but upheld dismissal of the Illinois Whistleblower Act claim.

The case is Shannon Volling and Allen Springer v. Kurtz Paramedic Services, Inc., No. 15-3572 (7th Cir., October 19, 2016).

Wednesday, November 2, 2016

Wisconsin Court of Appeals Finds Construction Superintendent Fired While on Worker's Compensation Does Not Have Unreasonable Refusal to Rehire Claim

In May 2012, the plaintiff, Kevin Roberts, was hired by the defendant, Stevens Construction, to work as a project superintendent for a construction project in Michigan.  On July 29, 2012, Roberts suffered a work-related injury and received workplace restrictions and was unable to continue working on the Michigan project.  While he received medical treatment for his injuries, Robert remained employed by the defendant.  On August 20, 2012, Roberts' treating physician stated that Roberts was able to "return to regular duty."  That same day, Roberts reported to Stevens Construction and informed the HR manager that his restriction had been lifted.  However, the defendant informed Roberts that "things hadn't gone as well as [he] had hoped" and Roberts' employment was terminated.  In a letter dated August 20, 2012 from Stevens Construction, Roberts' termination was confirmed stating that his "performance at the Michigan project was not what [Vine, the president of Stevens Construction] had hoped for/expected and [Roberts'] position with Stevens Construction was terminated."

Roberts filed a claim under WIS. STAT. section 102.35(3) with the Wisconsin Department of Workforce Development ("DWD"), claiming Stevens Construction had unreasonably refused to rehire him following his injury.  Following a hearing before an administrative law judge, it was determined that Stevens Construction had not unreasonably refused to rehire Roberts, with the ALJ finding that Roberts' employment had been terminated because of his performance and also because Stevens Construction did not have any ongoing work available for Roberts when his employment was terminated.  Roberts petitioned the Labor and Industry Review Commission ("LIRC") who affirmed the ALJ and then sought review by the circuit court, who affirmed LIRC's decision, which prompted appeal to the Wisconsin Court of Appeals who upheld all of the lower decisions.

Court of Appeals Finds Stevens Construction Did Not Unreasonably Refuse to Rehire Roberts

Whether an employer has unreasonably refused to rehire an employee under WIS. STAT. section 102.35(3) presents a mixed question of fact and law.  Wisconsin courts employ a burden-shifting approach when an employee brings a Wis. Stat. § 102.35(3) claim for unreasonable refusal to rehire. Under this approach, the employee must first make a prima facie case of an unreasonable failure to rehire. It is undisputed that as part of the prima facie case, the employee must show that: (1) the claimant was an employee of the employer from which he or she seeks benefits;15 (2) the claimant was injured in the scope of employment; and (3) subsequent to the injury, the employer refused to rehire the employee.  If an employee makes their prima facie case, the burden shifts to the employer to show a reasonable cause of the employer's refusal to rehire the employee.  

LIRC determined that Roberts made a prima facie case showing that Stevens Construction unreasonably refused to rehire him, so the Court of Appeals focused on whether Stevens Construction satisfied its burden of showing a reasonable cause for its refusal to rehire Roberts.

Roberts essentially argued that even though the project was coming to an end, other employees besides him were laid off or not retired was not based on credible and substantial evidence and was instead based "on nothing more than conjecture and speculation."  Roberts argued that the evidence showed that other superintendents and employees who had been working on the Michigan project were either moved to one of the limited number of available superintendent jobs or were allowed to utilize their paid time off days (PTO).  Roberts also argued that Stevens Construction did not meet its burden because they did not show that not only was there a lack of superintendent work for him to perform, but they did not show that there was also non-superintendent work his could have performed within his limitations at the time he was terminated.  The Court of Appeals disagreed.

Stevens Construction showed that at the time Roberts' employment was terminated, the Michigan project was nearing completion and that employees working on that project were being taken off it.  Besides the Michigan project, they had 6 other ongoing projects in August 2012, but there were not available positions for Roberts at those projects.  The one comparable superintendent Roberts relied upon, was allowed to use PTO when he was terminated, which allowed him to remain employed, but Roberts had not shown that he had any PTO to use in the same manner.  Thus, Stevens Construction did not unreasonably refuse to rehire Roberts and his claim was dismissed.

The case is Kevin Roberts v. Stevens Construction CorporationDocket: 2015AP002441.

Tuesday, November 1, 2016

7th Circuit Holds Teacher with PTSD May Proceed on Failure-to-Accommodate Claim

Eymarde Lawler, the plaintiff, was diagnosed with post-traumatic stress disorder ("PTSD") at least 5 years before she was hired by School District 150 in Peoria, IL, the defendant, to teach students with learning disabilities.  Lawler worked for the next 9 years for the defendant performing her job satisfactorily and was given tenure.  In 2010, her PTSD relapsed and that is when the defendant first learned of her disability. 

In response to her relapse, Lawler was transferred to a different school to teach children not only with learning disabilities, but also severe emotional and behavioral disorders.  After a year at this new school, Lawler was rated as "satisfactory" but by then her PTSD was "retriggered" and her psychiatrist notified the defendant that she needed to be transferred to a different teaching environment.  The defendant did not transfer the plaintiff but instead accelerated her next performance appraisal, rated her as "unsatisfactory" and fired her as part of an announced reduction in force that ended with all but "unsatisfactory" teachers being rehired. 

Lawler then sued the defendant under the Rehabilitation Act of 1973, claiming that the defendant not only failed to accommodate her PTSD but also fired her in retaliation for requesting an accommodation.  The district court granted summary judgment to the defendant on all claims, reasoning that the defendant had sufficiently engaged in an interactive process to accommodate Lawler's PTSD by permitting a 2-week medical leave of absence.  On appeal, the 7th Circuit found that Lawler had abandoned her retaliation claim and thus only addressed the failure-to-accommodate claim.

The School District Failed to Accommodate the Plaintiff's PTSD

On appeal, the plaintiff argued that the record included a material dispute about whether the Director of Human Resources, worked with her to accommodate her PTSD.  Lawler insisted that, during their very first meeting in September 2011, the HR director summarily refused to consider transferring her out of the new school she was transferred to.  Lawler contended that this constituted a refusal to engage in the interactive process. 

The Court noted that under the ADA, and therefore under the Rehabilitation Act, both parties are required to make a "good faith effort" to determine what accommodations are necessary, but if a breakdown occurs, "court should attempt to isolate the cause ... and then assign responsibility."  Lawler's physician sent the defendant a letter stating that Lawler should "transfer to another special education job in the District that does not involve [behavioral and emotional disorder] students."  The Court held that the defendant's outright refusal belies any contention that the defendant made a reasonable attempt to explore possible accommodations, such as looking for open positions in other schools or reducing the number of students with behavioral or emotional disorders in Lawler's classroom.  The Court found that the defendant "sat on [their] hands" instead of following-up with Lawler or asking for more information.

The Court found the defendant's argument that they reasonably accommodated Lawler by granting her 2-week medical leave of absence as "frivolous."  The Court found that this short-term leave did not address her psychologist's concern that Lawler's PTSD was aggravated by working with students having severe behavioral and emotional disorders:  "A few weeks respite from that environment might have given Lawler some relief while she was away, but according to her psychologist, returning to the same position would impede her ability to control her PTSD." 

The Court also noted that since Lawler's performance declined after she returned to the same position despite wanting a transfer, then the defendant "surely was on notice that more than a two-week break was needed to give Lawler an opportunity to continue working with PTSD (as she had been doing for years before the school district learned of her impairment).  Furthermore, the Court held that a jury could find from the evidence that Lawler's need for a transfer easily could have been accommodated, since at least 7 openings for special education teachers existed in other schools within the district at that time.

Even though the defendant may have been under the impression that Lawler had changed her mind about a transfer, the Court still found that the defendant failed to engage in the interactive process by making that assumption without seeking clarification from Lawler or her doctor.  Thus, the Court held that a reasonable jury could conclude that the defendant's failure to seek clarification from Lawler or her doctors caused the breakdown in the interactive process.

Summary judgment VACATED and the case REMANDED for further proceedings.

The case is Eymarde Lawler v. Peoria School District No. 150, Case No. 15-2976 (7th Cir. Sept. 16, 2016).

Wednesday, October 26, 2016

7th Circuit: At-Will Employee Cannot Prevail Against Coworkers Who Helped Get Him Fired

I get many, many, many calls from people who have been terminated from their job and claim that one or more of their coworkers lied about them or something they allegedly did and wonder about the legalities of such conduct.  I often have to explain that such conduct is often not subject to a claim and that even if they were, they are rare for practical reasons such as time and expense as these types of claims are what are known as "common law" claims that are pursued directly in either state or federal court.  While this sounds very discouraging, the Court of Appeals for the Seventh Circuit recently explained in a decision why at-will employment is the 'way it is.'  Indeed, the vast majority of employees in the United States are at-will.

At issue in Wesbrook v. Ulrich, (Oct. 20, 2016) was the scope of remedies a fired at-will employee might have against individual supervisors and co-workers.  The plaintiff, Dr. Stephen D. Westbrook, Ph.D. ("Westbrook"), was the former deputy director of the Marshfield Clinic, a prominent not-for-profit health care system headquartered in Marshfield, Wisconsin.  Westbrook's immediate supervisor was Dr. Humberto Vidaillet ("Vidaillet") and the defendants, Dr. Karl J. Ulrich, M.D. ("Ulrich") and Edward A. Belongia, M.D. ("Belongia") served as the president and chief executive officer and senior research scientist and research center director, respectively.

While Westboork had a good working relationship with his immediate supervisor Vidaillet, it appears his working relationship with most others, including the defendants, was "marked with internal conflict."  Westbrook's behavior as deputy director apparently led to employee complaints and departures which ultimately led to Westbrook being terminated in 2010 (though reinstated), and then placed on a performance improvement plan and then terminated again on January 2, 2012.

In 2013, Westbrook filed suit accusing Ulrich, Belongia, and two other former colleagues of tortiously interfering with his employment based on four statements that Ulrich published to the Clinic's board of directors (Westbrook's complaint contained many more allegations but by summary judgment, those were narrowed down to the four statements).  The district court allowed Westbrook's claims against Ulrich and Belongia to proceed to discovery and then they later moved for summary judgment, which was granted by the district court.  In granting the defendants' motion for summary judgment, the court acknowledged that Westbrook's "evidence of internal strife within the Clinic is strong, especially as it concerns Ulrich's possible motives," but the court found undisputed facts that showed that each of the challenged statements were true or substantially true.  Ulrich's motives where therefore immaterial.

                                               The 7th Circuit's Decision

Under Wisconsin law, a claim for tortious interference with a contract requires proof of 5 elements:

1)  the plaintiff had a contract or a prospective contractual relationship with a third party;
2)  the defendant interfered with that relationship;
3)  the interference by the defendant was intentional;
4)  there was a causal connection between the interference and damages; and
5)  the defendant was not justified or privileged to interfere.

The parties disputed the 5th element: whether the defendants' challenged statements were privileged.  Wisconsin law recognizes an important exception to the ordinary multi-factor inquiry about privilege.  If a claim for interference is based on statements that are true, the claim must fail as a matter of law, at which point, motive is immaterial.  The Court also noted that a statement may be "substantially true"--and thus privileged--even if some fine splitting of semantic hairs might leave room to argue about its literal truth.

The Court ultimately held that two of the four statements Westbrook narrowed his argument down to involved "semantic hairsplitting," one misconstrued what was actually said about him, and the fourth was unsupported by the record and immaterial. Thus, summary judgment was upheld.

                                             Preston v. Wisconsin Health Fund

Westbrook also urged the 7th Circuit to overturn precedent in Preston v. Wisconsin Health Fund, 397 F.3d 539 (7th Cir. 2005) whereby they addressed Wisconsin's law of tortious interference in the context of employment.

In affirming summary judgment in Preston, the 7th Circuit explained that an employee who alleges tortious interference by a co-worker or supervisor must prove "both that the employer did not benefit from the defendant's act and that the act was independently tortious, for example as fraud or defamation."  Westbrook challenged this two-prong test arguing that Preston improperly modified the elements of a tortious interference claim under Wisconsin law.

The 7th Circuit declined to overturn Preston for two reasons:  1)  the Wisconsin judiciary has not given them any indication that it disagrees with Preston as 12 years has passed and no Wisconsin court has disapproved or even distinguished it.  2)  they believe Preston was decided correctly:
If Preston had allowed the plaintiff's tortious interference claims to proceed to trial, it would have opened a rather broad avenue under tort law to bypass well-established limits on contract remedies for at-will employees.  Fired at-will employees who have no remedy under contract law would have incentive to sue not their employers for breach of contract but their former co-workers and supervisors under tort.  Under Westbrook's theory, a fired at-will employee would be entitled to a jury trial if there were evidence of ill will or malice on the part of a former co-worker or supervisor who participated in a firing decision.  Such evidence would not be rare.  Such a new avenue under tort law would likely "transform employment at will into employment terminable only for cause,"  Preston, 397 F.3d at 543, as the threat of personal liability in a lawsuit could easily discourage supervisors from taking adverse employment actions.
Thus, if Preston were overruled, the 7th Circuit foresaw a "floodgate of litigation" for at-will employees who are fired because of things their co-workers or supervisors communicated leading to their termination.  The 7th Circuit also opined that a change to the at-will doctrine is a matter of state law to be decided by state legislatures and courts.

The case is Wesbrook v. Ulrich, No. 15-3870 (Oct. 20, 2016).

Wednesday, October 19, 2016

11th Circuit Holds Job Applicants Cannot Sue For Age Discrimination Under the ADEA

In a decision that has sent shockwaves to plaintiff's attorneys in the 11th Circuit and beyond, a recent decision by the Court of Appeals for the Eleventh Circuit has held that job applicants cannot sue for disparate impact under the Age Discrimination in Employment Act ("ADEA") based upon a plain reading of the text.  The decision itself is 76 pages and went deep into the tenets of statutory construction and is beyond the scope of a blog article.  However, Harvard University law professor Noah Feldman wrote about the decision in a Bloomberg article headlined, “Subtle Age Discrimination Gets a Court’s Blessing” and sums up the decision and its effect very well.

The 11th Circuit covers Alabama, Florida and Georgia, not Wisconsin as we reside in the 7th Circuit.

Tuesday, October 18, 2016

8th Circuit: Trucking Company's Requirement That Drivers with High BMI Submit to Sleep Study Does Not Violate ADA

The Court of Appeals for the Eighth Circuit recently held that a trucking company who subjected one of its truck drivers to a sleep study to see if he had obstructive sleep apnea because he had a body mass index ("BMI") over 35, did not violate the Americans with Disabilities Act ("ADA"), nor did it discriminate against the plaintiff, Robert J. Parker ("Parker"), when he was terminated for refusing to take a sleep study.


The defendant, Crete Carrier Corporation ("Crete") hired Parker as an over-the-road truck driver in 2006.  As a driver of a commercial motor vehicle for a motor carrier, Parker was bound by regulations issued by the USDOT's Federal Motor Carrier Safety Administration.  In 2010, Crete began a sleep apnea program based primarily on recommendations from two advisory committees.  The program required drivers at risk for obstructive sleep apnea to undergo in-lab sleep studies.  Crete required an in-lab sleep study if either (1) the driver's BMI was 35 or above, or (2) the driver's physician recommended a sleep study.  At parker's most recent DOT physical, his BMI was over 35.

In July 2013, Parker visited a certified physician not affiliated with Crete who wrote a prescription stating, in whole, "I do not feel it is medically necessary for Robert to have a sleep study."  Parker then refused to participate in a sleep study and then Crete took Parker out of service.  Parker then sued Crete alleging it required a medical examination violating 42 U.S.C. section 12112(d)(4)(A) and discriminated against him because it regarded him as having a disability, violating 42 U.S.C. section 12112(a).

                                 CRETE'S SLEEP STUDY DID NOT VIOLATE THE ADA

The ADA prohibits employers from "requiring a medical examination ... unless such examination ... is shown to be job-related and consistent with business necessity."  When an employer requires a medical exam of its employees, the employer has the burden of showing that the exam is job-related and that "the asserted 'business necessity' is vital to the business and the request for a medical examination or inquiry is no broader or more intrusive than necessary."  "[C]ourts will readily find a business necessity if an employer can demonstrate ... a medical examination or inquiry is necessary to determine ... whether the employee can perform job-related duties when the employer can identify legitimate, non-discriminatory reasons to doubt the employee's capacity to perform his or her duties."  "The examination or inquiry need not be the only way to achieve a business necessity, but it must be a reasonably effective method to achieve the employer's goals." 

Parker argued that Crete failed to consider his individual characteristics before mandating the sleep study.  However, the Court held that the text of the ADA (section 12112(d)(4)(A)) does not require this, and, to the contrary, the ADA permits employers to require a CLASS of employees to get medical exams.  When an employer does this, they meet their burden by showing a "reasonable basis for concluding" that the class poses a genuine safety risk and the exam requirement allows the employer to decrease that risk effectively.  Crete met this burden as its required class--drivers with BMIs of 35 or above--had to submit to an in-lab sleep study, a medical exam. 

The Court found that, by their undisputed facts, the sleep study requirement is job-related because it deals with a condition that impairs drivers' abilities to operate their vehicles and it is consistent with business necessity because it is necessary to determine whether an individual has obstructive sleep apnea, a condition that poses a public safety hazard by increasing the risk of motor vehicle accidents.  Furthermore, the Court held Crete had reasons to suspect that Parker had sleep apnea because of his BMI being over 35.


The Court also found that Crete did not discriminate against Parker based upon perceived disability because of his failure to submit to a lawful sleep study for the reasons previously mentioned, which serves as a legitimate, non-discriminatory reason for his termination.

For all of these reasons, the 8th Circuit upheld the District Court's grant of summary judgment, dismissing all of Parker's claims.  The case is Robert J. Parker v. Crete Carrier Corporation, No. 16-1371 (8th Cir. Oct. 12, 2016).

Tuesday, October 11, 2016

NLRB Issues Complaint Against Postmates

The National Labor Relations Board ("NLRB") recently announced that it has issued a complaint against the popular mobile food delivery app, Postmates.  From the press release on the complaint:
The complaint alleges that Postmates violated the National Labor Relations Act by requiring employee drivers to enter into arbitration agreements as a term of employment. Additionally, the Region 13 Office found that Postmates interfered with employees Section 7 rights by prohibiting them from discussing terms and conditions of employment, including safety, with other drivers.

To remedy the unfair labor practices, the complaint seeks an order requiring that Postmates rescind the overly broad provisions in their arbitration agreements then notify the employees of this change; post a notice both electronically and at all Postmates facilities in the U.S.; and cease and desist from enforcing their unlawful policies.

Parties have until October 19th to respond to the complaint. Absent a settlement, the NLRB is scheduled to begin litigation in Chicago on January 26th.

Wednesday, September 28, 2016

7th Circuit Finds No Hostile Work Environment When Employee Finds Noose in Work Space

Undoubtedly, most, if not all, laypersons, and even most lawyers, who read the title of this post will instantly wonder how any court could not find a hostile work environment claim to have merit when a noose is discovered in the workplace by an African-American employee.  I often find myself in very difficult phone call consultations with people when I have to hear their very difficult work situations and then have to explain the law to them.  Indeed, some of these callers hang up on me as if I do not know what I am talking about and they do not want to hear it anymore.  However, as this case highlights, plaintiffs in discrimination, harassment and hostile work environment cases, have very difficult burdens to meet.


The plaintiff, Jerome Cole, worked for Northern Illinois University in the Building Services Department since 1998.  Cole is African-American and alleges that, beginning in 2009, he experienced race discrimination, retaliation, and a hostile work environment based on his race.  He sued the university's board of trustees and eleven (11) individuals under Title VII of the Civil Rights Act of 1964 and the Equal Protection Clause of the 14th Amendment. 

In 2009, Cole because a sub-foreman.  In 2011, Cole claims he was promoted to foreman (the defendants disputed this, but for purposes of summary judgment, Cole's assertion was taken as true).  At all times relevant, Cole was the only African-American foreman or sub-foreman in the department.  Cole alleged that his promotion to sub-foreman marked the start of a "laundry list of events" he claims amounted to unfair and discriminatory treatment.  Cole was demoted in 2012 because the acting superintendent learned that Cole and Ruth Stone, an acting sub-foreman in the same department, had been promoted without attention to proper procedures.

In mid-November 2012, Cole discovered a hangman's noose in his work area.  Cole threw the noose away, but inexplicably, the next day he discovered the same or possibly a second noose outside the building.  A department sub-foreman, John Holmes, told Cole that he, and two others found the noose earlier in an office on the other side of Cole's new work area.  Cole called two police officers he knew for advice and was told to "keep his cool" to try to "smoke out" the perpetrator.  Cole took the noose to the university police department.  He later emailed one of the Building Services supervisors, Richards, and told her that he had discovered a noose and taken it to the police.

Richards took Cole's email to the police station and turned it in to the acting superintendent and spoke to two other university officials about the incident.  By February 2013, the university police had begun an investigation.  A detective interviewed Holmes and Cole but the detective was then told by his supervisor to stop the investigation.  The person who left the noose in the break room was never identified.  The police investigation, which ultimately proved fruitless, was the only substantial step the university took after the noose incident.  Nothing in the record suggested that the noose incident was repeated after that.

7th Circuit Finds No Hostile Work Environment

The district court granted the defendants' motion for summary judgment, rejecting the hostile work environment claim, holding that (1) most of the hostile events were not based on Cole's race; (2) Cole had not produced evidence that the noose was intentionally left for him to find; and (3) Cole had not shown a basis for employer liability.

Harassment sufficiently severe or pervasive to alter the terms and conditions of employment is actionable under Title VII as a claim of hostile work environment.  To prove a claim for hostile work environment based on race, an employee must show:  (1) he was subject to unwelcome harassment; (2) the harassment was based on his race; (3) the harassment was severe or pervasive so as to alter the conditions of the employee's work environment by creating a hostile or abusive situation; and (4) there is a basis for employer liability.  Thus, as I mentioned at the outset of this article, a plaintiff has a large burden to meet and a lot of things to prove to meet their burden.

The crux of Cole's hostile work environment claim is the discovery of the noose.  The 7th Circuit found that the first and second prongs were easily met as the noose undoubtedly qualifies as "unwelcome harassment" and that given its disturbing history and status as a symbol of racial terror, the Court had no difficulty assuming that the harassment could be treated as based on race.

The Court agreed with the district court that the record in the case does not support a reasonable inference that most of the hostility Cole encountered was connected to his race as there was almost no evidence of racial animus in the record:  no hostile or ambiguous remarks, no racial slurs, nothing beyond the notable exception of the noose itself and the later secondhand report of a racist sign posted somewhere, at some unknown time by some unknown person.

With respect to the third prong, the Court held that they were hesitant to agree with the district court when they found that Cole count not produce evidence that the noose had been displayed or intentionally left for him to find.  The Court noted that a noose on display is generally likely to have more of an impact on employees than one hidden away in a co-worker's desk.  Thus, the Court decided not to lay down firm rules for when a noose in the workplace is or is not severe enough to be actionable.

No Employer Liability
The Court did find that Cole failed to present evidence to support the fourth element of his claim: a basis for employer liability.  Employers are strictly liable for supervisor harassment, but when a plaintiff claims that co-workers are responsible for the harassment, "he must show that his employer has 'been negligent either in discovering or remedying the harassment.'"  There was no evidence that a supervisor was involved in leaving the noose, so Cole had to present evidence allowing a reasonable jury to find that the university was negligent--which means in this context that it failed to take "prompt and appropriate corrective action reasonably likely to prevent the harassment from recurring."

A prompt investigation is the first step toward a reasonable corrective action.  The undisputed facts in this case, the Court held, show that Cole notified a supervisor of the discovery of the noose, the supervisor spoke to him about it and delivered her notes of the incident to the university police.  The supervisor also reported the incident to a couple university officials.  The Court held that in these circumstances, it was reasonable for the administration, having involved the university police, to leave the investigation to them.

The Court was also careful to make it clear that they were not holding that an employer necessarily fulfills its responsibility to take appropriate corrective action if it has reported an incident to some other party--such as university police.  The question is whether the employer took corrective action "reasonably likely" to prevent harassment from recurring.

The Court did conclude by stating that, "bad 'joke' or not, the presence of a hangman's noose in the workplace is not acceptable.  But based on the circumstances here, including Cole's reaction and the fact that the Building Services Department turned the matter over to the police for investigation...we see no basis for employer liability in this case."

Plaintiff's Race Discrimination and Retaliation Claims Likewise Failed

The 7th Circuit also upheld the district court's granting of summary judgment for the defendants on Cole's disparate treatment and retaliation claims finding that Cole presented no direct or circumstantial evidence of disparate treatment based on race and that Cole had not engaged in protected activity to survive a retaliation claim.  While these claims were not the highlight of this case, it is important to note that this decision cites a recent significant case, Ortiz v. Werner Enterprises, Inc., No. 15-2574, - F.3d -, -, 2016WL 4411434, at *4 (7th Cir. Aug. 19, 2016), which is a case that held that "evidence must be considered as a whole, rather than asking whether any particular piece of evidence proves the case by itself--or whether just the 'direct' evidence does so, or the 'indirect' evidence."  I blogged about this case previously.

The case is Jerome Cole v. Board of Trustees of Northern Illinois University, et al., No. 15-2305 (7th Cir. Sept. 27. 2016).

Tuesday, September 27, 2016

EEOC Loses Another Battle Against Employer's Wellness Program

Back in January I blogged about a case out of the Western District of Wisconsin whereby the federal district court there granted summary judgment against the Equal Employment Opportunity Commission ("EEOC") in their challenge to an employer's wellness program.  Undeterred, the EEOC continued with a suit it had previously filed in the Eastern District of Wisconsin against Orion Energy Systems, Inc., also alleging their wellness program violated the Americans with Disabilities Act ("ADA") and that Orion retaliated against an employee who chose to speak out against the program and opted out of the wellness program.  The judge in the Eastern District likewise ruled against the EEOC, but on very different grounds than the Western District, potentially giving rise to the 7th Circuit finally addressing this issue.


In 2008, Orion decided to switch from a fully insured health plan to a self-insured health plan, believing that a self-insured company can reduce or at least slow the increase of its health care costs by improving the health of its employees.  Toward that end, in the spring of 2009, Orion decided on a wellness initiative including three (3) components:
(1)  employees who elected to enroll in Orion's plan would have to certify that they did not smoke or pay a surcharge ($80/month for single coverage);
(2) employees would have to exercise sixteen (16) times per month on a range of motion machine located in Orion's fitness center or pay a surcharge ($50/month); and
(3) employees would have to either complete a health risk assessment (HRA) at the beginning of the insurance year or pay the entire monthly premium equivalent amount, which was $413.43 for single coverage, $744.16 for limited family coverage, and $1,130.83 for family coverage.  Employees who completed the HRA paid no premium equivalent, but still had to pay their own deductibles, co-pays and out-of-pocket expenses.

Wendy Schobert was an employee in Orion's accounting department from 2003 until May 18, 2009 when her employment was terminated.  Before ultimately opting out of the HRA in April 2009, Schobert raised questions about the new wellness initiative, including the HRA.  She questionied whether medical information collected in the HRA would remain confidential and also questioned how the premium amount was calculated, and believed it was excessive in light of the service fee Orion was paying its third-party administrator, Auxiant.  Due to privacy concerns in which Orion was conducting the HRA's, Schobert sent a letter to Orion's HR director, stating she elected not to participate in the HRA.  Sometime around April 2009, Schobert was "talked to" by her supervisor where Schobert claims she was told to keep her opinions about the new wellness program to herself.  On May 7, 2009, Schobert sent an email challenging and criticizing Orion's then CEO's request for information on how much time employees were using to get water and coffee in light of what Schobert believed were Orion's extravagant spending decisions on a variety of programs.  A few days later, the CEO instructed the CFO to terminate Schobert.

Legal Analysis

The EEOC alleged that Orion's wellness program violated Section 12112(d)(4)(A) of the ADA, which states that a covered entity "shall not require a medical examination and shall not make inquiries of an employee as to whether such employee is an individual with a disability or as to the nature of severity of the disability, unless such examination or inquiry is shown to be job-related and consistent with business necessity."  Section 12112(d)(4)(B), however, permits employers to conduct "voluntary medical examinations, including voluntary medical histories, which are part of an employee health program available to employees at that work site."  The EEOC argued that the HRA was not "voluntary" under (d)(4)(B) given Orion shifted 100% of the health benefit premium to employees who opted out, and also given that Schobert was fired 3 weeks after opting out (she was the only employee to opt out).

Orion argued that its wellness program did not violate section 12112(d)(4)(A) for 3 reasons:
(1) the ADA's safe harbor provision relating to insurance applies to the challenged aspects of the wellness program;
(2) Orion did not "make inquiries" as prohibited by (d)(4)(A) where Orion received only anonymous, aggregated employee responses and results from the HRA; and
(3) the wellness program was voluntary because Orion's employees had a choice regarding whether to participate and sufficient time to make that choice.

The Safe Harbor Provision Found to Not Apply
The district court judge found that the safe harbor provision did not apply, but that the wellness program was voluntary even though Orion shifted 100% of the health premium to any employee that opted out. 

In arguing that their wellness program is protected by the safe harbor provision, Orion relied on Seff v Broward County, 691 F.3d 1221 (2012), and EEOC v. Flambeau, Inc., 131 F. Supp. 3D 849 (W.D. Wis. 2015), the case I mentioned back in January 2016 and cited above.  The EEOC argued that these cases were wrongly decided and the Eastern District noted that the EEOC had since created a new regulation on this issue, which should receive "Chevron deference," and the court agreed.  However, the court also held that even without relying on the regulation, the safe harbor provision did not apply to Orion's wellness program, declining to adopt the holdings of Seff and Flambeau, because Orion's wellness program was not use to underwrite, classify, or administer risk and, in short, Orion's wellness program was wholly independent from its insurance plan.

The Court Held Orion's Wellness Program to be Voluntary
An employer cannot conduct a medical examination or make medical inquiries of an employee, "unless such examination or inquiry is shown to be job-related and consistent with business necessity."  A medical examination or inquiry that is "voluntary" and part of a health program does not violate the ADA.  The Court found Orion's wellness program to be voluntary because, even though opting out means paying 100% of the premium cost, the court noted that "a hard choice is not the same as no choice," citing the U.S. Supreme Court case of United States v. Martinez-Salazar, 528 U.S. 304, 315 (2000).  Thus, the court granted Orion summary judgment as to the EEOC's claim that their wellness program, including the HRA, violated the ADA.

EEOC's Retaliation Claim Allowed to Move Forward
Because Orion's wellness plan was ruled lawful, they argued that the EEOC's retaliation and interference claims fail as a matter of law, because, Schobert did not therefore engage in protected activity.  The ADA's retaliation provision does not protect an employee's right to complain generally.  However, the court noted, it is well established that an employee may engage in protected activity even if the challenged practice is not actually illegal, so long as the employee has a sincere and reasonable belief that she is opposing an unlawful practice.  The court found Schobert's opting out of the HRA to be protected activity.  Therefore, given the conflicting evidence regarding who actually decided to terminate Schobert and why, and the timing of her termination, a fact question remained as to whether there was any causal link between Schobert's protected activity and her termination.

The case is EEOC v. Orion Energy Systems, Inc., September 19, 2016, Griesbach, W.

Wednesday, September 21, 2016

Illinois General Assembly Passes Legislation Limiting Use of Noncompete Agreements

A year ago popular sandwich maker Jimmy John's made news for their use of noncompete agreements for their employees, many of whom were low wage earners.  While many scoffed at these agreements, Jimmy John's fared well in court winning a defense to an injunction filed in federal court in Illinois.  In response, the Illinois General Assembly has passed legislation, the Illinois Freedom to Work Act, effective January 1, 2017, whereby an employer and a low-wage employee are prohibited from entering into any agreement that restricts the employee from performing work for another employer for a specified period of time or that restricts the employee from working in a particular geographic area or working for another employer that is similar to the low-wage employee’s work for the employer.  

A “low-wage” employee is defined as someone who earns $13 per hour or the local, state or federal minimum wage if it is greater than $13. For such workers, an agreement with restrictive covenants as described in the act will be “illegal and void.”

It'll be interesting to see if other states follow suit.  Currently, Wisconsin strongly disfavors noncompete agreements, but legislation was introduced by Republicans in the state to make them easier to enforce, though that legislation doesn't appear to have been passed.