Supreme Court Issues Two Title VII Decisions Favorable for Employers

This post was contributed by Adam R. Long, a Member in McNees Wallace & Nurick LLC's Labor and Employment Law Practice Group.

At our recent Labor and Employment Law Seminar, we highlighted a number of outstanding legal cases that have the potential to have a significant impact on employer liability. On Monday, the U.S. Supreme Court issued decisions in two closely watched Title VII employment discrimination/retaliation cases. In each case, the Court clarified previously unsettled legal questions in favor of employers.

In Vance v. Ball State University, a 5-4 majority of the Court held that an employee qualifies as a "supervisor" for purposes of Title VII harassment liability only if the employee "is empowered by the employer to take tangible employment actions against the victim." In its analysis, the Court expressly rejected the EEOC's more expansive definition of "supervisor," which included any employee who had "the ability to exercise significant direction over another's daily work," even if the employee lacked the authority to take tangible employment actions.  

In University of Texas Southwestern Medical Center v. Nassar, the same 5-4 majority confirmed that to establish a Title VII retaliation claim, an employee must prove that the alleged protected activity was a "but for" cause of the employer's alleged adverse action. With this decision, the Court rejected the lower standard of proof used in Title VII discrimination claims, which requires proof only that the retaliation was a "motivating factor" in the employer's action. The "but for" causation standard is the same standard endorsed by the Court in 2009 for discrimination claims arising under the Age Discrimination in Employment Act.

Both Vance and Nassar will assist employers when defending against Title VII discrimination and retaliation claims. The Court in Vance limited the scope of employees who will qualify as "supervisors" for purposes of Title VII's harassment liability. If the alleged harasser does not qualify as a "supervisor," the plaintiff will need to prove that the employer was negligent in allowing the harassment to occur, a showing not necessary for supervisor-based harassment. With its Nassar decision, the Court made it more difficult for plaintiffs to prove Title VII retaliation claims by necessitating proof of but-for causation. In light of the ever increasing number of Title VII retaliation claims filed with the EEOC and in court, the Nassar decision could have a significant impact for litigants moving forward.   

Public Sector Supervisors Can Be Personally Liable for Violations of the FMLA

A recent Third Circuit Court of Appeals decision has made clear that supervisors in public agencies may be subject to individual liability under the Family and Medical Leave Act (FMLA). The court previously has held that public employers, private employers, and supervisors in the private sector may be liable for FMLA violations. Now, for the first time, in Haybarger v. Lawrence County Adult Probation and Parole, the court has extended FMLA liability to supervisors in the public sector.

The facts in Haybarger may seem eerily familiar to many of you. A public-sector employee took FMLA-covered absences for a number of different health issues. The supervisor, who served as the Director of the Probation and Parole Office, believed that the employee was under performing and that her attendance problems contributed to her poor performance. The supervisor wrote in the employee's performance evaluations that she needed to improve her overall health and cut down on the days that she missed due to illness (red flag!). The supervisor also formally disciplined the employee, placing her on probation for six months, which required weekly formal progress assessments and monthly meetings. While it is unclear who specifically made the ultimate decision to terminate the employee, she was terminated when her performance did not improve.

Not surprisingly, following her termination the employee brought suit raising a number of claims against the County, the Probation and Parole Office, and the supervisor. After many of the claims were dismissed, and a few were settled, all that remained for the court to decide was the FMLA claim against the supervisor. The supervisor argued that he was not liable under the FMLA.

Unfortunately for public sector supervisors, the court disagreed and held that public sector supervisors can be individually liable for violations of the FMLA.

This decision is scary for public sector supervisors, who now may be personally liable for back pay and other damage awards where their individual actions and decisions violate the FMLA. Whether or not an individual is a supervisor under the FMLA will depend on the facts and circumstances. While there might be a debate regarding who constitutes a supervisor in a particular situation, the message of Haybarger is clear: where a supervisor exercises supervisory authority over the complaining employee, and is responsible, in whole or part, for the alleged violations of the FMLA while acting in the employer's interest, that supervisor may face liability under the FMLA.

In Haybarger, the court concluded that the Director of Probation and Parole Office was a supervisor with respect to the particular employee. When acting on behalf of the employer (i.e., within the scope of his authority), he had control over the termination decision (even though he was not the final decision maker), he supervised her work, he completed her performance evaluations, and he had the authority to discipline the employee; as a result, the court concluded that he could be individually liable for FMLA violations that were a product of his supervisory actions.

With this decision, the court set up what is known as a circuit split, meaning that the different appeals courts around the country have decided the same issue differently. Often in these situations, the Supreme Court of the United States will step in and decide the issue to ensure consistency across the country. For now, though, the Haybarger decision is the law only in the Third Circuit, i.e. Pennsylvania, New Jersey, Delaware and the U.S. Virgin Islands.

Employers, both public and private, should make sure that supervisors receive regular FMLA training. While supervisors do not necessarily need to become experts, they should know: how to recognize a potential FMLA-covered absence; that employees cannot be disciplined for FMLA-covered absences; and that FMLA-covered absences should not be referenced in performance evaluations, among other things. In addition, employers should ensure that supervisory decisions related to the discipline and discharge of employees who are out of work on, or have recently returned from, FMLA leave are given more rigorous scrutiny.

Who is a "Management Level Employee" for Imputing Notice of Co-worker Harassment to an Employer?

An employer's liability for co-worker harassment exists if the employer knew or should have known of the harassment and failed to take prompt remedial action. In other words, an employer may be liable for non-supervisory co-worker harassment if the employer was negligent in failing to discover the co-worker harassment or in responding to a report of harassment. Knowledge of a sexually hostile work environment arises when a "management level employee" obtains enough information to raise the probability of sexual harassment in the mind of a reasonable employer.

In its decision in Huston v. The Proctor & Gamble Paper Products Corp., the Third Circuit Court of Appeals concluded that an employee’s knowledge of allegations of co-worker sexual harassment may typically be imputed to the employer in two circumstances:

  1. "where the employee is sufficiently senior in the employer’s governing hierarchy, or otherwise in a position of administrative responsibility over employees under him, such as a departmental or plant manager, so that such knowledge is important to the employee’s general managerial duties. In this case, the employee usually has the authority to act on behalf of the employer to stop the harassment, for example, by disciplining employees or by changing their employment status or work assignments. The employee’s knowledge of sexual harassment is then imputed to the employer because it is significant to the employee’s general mandate to manage employer resources, including humanresources;" or
  2. "where the employee is specifically employed to deal with sexual harassment. Typicallysuch an employee will be part of the employer’s human resources, personnel, or employee relations group or department. Often an employer will designate a human resources manager as a point person for receiving complaints of harassment. In this circumstance, employee knowledge is imputed to the employer based on the specific mandate from the employer to respond to and report on sexual harassment."

The court went on to clarify that mere supervisory authority over the performance of work assignments by other co-workers is not, by itself, sufficient to qualify an employee for management level status unless the worker has  a mandate generally to regulate the workplace environment. This reasonably bright line test should help employers to avoid allegations of constructive knowledge of workplace problems; provided, job descriptions clearly define the employee's job duties. Employers should examine generalized policy statements that create a "duty" to report workplace harassment or mistreatment.

Human Resources Legal Compliance Checklist for 2009

Human Resource Professionals face a demanding legal compliance year in 2009. The following five items should be added to your "To Do" list for the first quarter of '09:

ADA Amendments Act Compliance (effective 1/1/2009):  The amendments greatly expand the definition of disability refocusing compliance on determining whether the employee is "qualified" and evaluating reasonable accommodations. Employers should consider the following:

  • Revising job descriptions to define essential job functions and minimum qualifications.
  • Formalizing the interactive process for assessing disability issues.
  • Educating supervisors on the expanded ADA coverage.

E-Verify Registration and Immigration Compliance (effective 1/15/2009):  Government contractors and subcontracts may need to register for and use the E-Verify System for new and existing government contracts. Employers who may be covered should inventory their existing contracts and review prospective contracts and subcontracts to determine whether they are covered by the regulations.

U.S. Citizenship and Immigration Services (USCIS) has amended regulations governing the types of acceptable identity and employment authorization documents that employees may present to their employers for completion of the Form I-9, Employment Eligibility Verification. Under the interim rule, employers will no longer be able to accept expired documents to verify employment authorization on the Form I-9. There are other changes to the types of acceptable documents. Employers must use the revised Form I-9 (not yet issued) for all new hires and to re-verify any employee with expiring employment authorization beginning January 31, 2009. The current version of the Form I-9 will no longer be valid as of February 2, 2009.


FMLA Regulations Implementation (effective 1/16/2009):  Amendments to the FMLA's regulations require action by employers in the following areas:

EFCA and RESPECT Act Planning:  This pending legislation has enormous potential consequences for employers. Developing an action plan should include the following items:

Wage & Hour Self-Audit:  As evidenced by Wal-Marts recent record settlement, wage and hour lawsuits will play prominently in 2009. A self-audit of compliance practices can mitigate these claims particularly in the following areas;

  • Employee classification (exempt vs. non-exempt)
  • Off the clock work (starting times, breaks and meal periods)
  • Donning and Doffing
  • Child labor

Will Your Employees be some of the 5 million Workers Unions expect to add to their Membership under the Employee Free Choice Act?

Change is coming to Washington and to America's workplaces. President Elect Obama launched a new website where he explains his labor agenda which included passage of the Employee Free Choice Act. The Obama Administration's transition views are summarized at the Connecticut Employment Law Blog.
Unions are on board too. After their push for Obama, Unions seek new rules for organizing workforces through the EFCA, as observed by Steve Greenhouse of the NYTimes:

With union membership sliding to 7.5 percent of the private-sector work force, one-third the rate in 1983, unions see enactment of the bill as the single most important step toward reversing their loss of membership and power. Some labor leaders predict that if the bill is passed, unions, which have 16 million members nationwide, would add at least five million workers to their rolls over the next few years.

The impact of the EFCA will be monumental so we will be dedicating a lot of blog time to this topic. Look for future posts in the following areas:

  • Nuts and Bolts of EFCA: examines the specifics of the proposed legislation.
  • Employer's Guide to Authorization Cards: looks in detail at authorization cards, their legal significance and how they are solicited by unions.
  • Identifying and Training Supervisors to Maintain your Union-Free Status: outlines the role of supervisors in disseminating the employer's message including the impact of the RESPECT Act.
  • Employee Engagement Surveys as a Tool to Combat Union Organizing: keeping your finger on the pulse of employee.
  • Becoming Politically Active in Response to EFCA: making your business's voice heard in Washington and particularly by the one Republican Senator, Arlen Specter of Pennsylvania, who has co-sponsored the EFCA.
  • How to Avoid Unfair Labor Practices when you are an Organizing Target: negotiating the legal landscape of traditional labor law.


Bosses do not Deserve RESPECT

October 16th is the annual celebration of Boss’s Day, which has traditionally been the day for employees to “thank their boss for being kind and fair throughout the year”. In most workplaces, it is clear who is a boss and who is not. The boss is the one who tells you what to do, completes your performance review and hassles you when you do not follow company policy.

The term “boss” generally means “supervisor”. For us in the legal-compliance world, knowing who is a supervisor and who is not is very important. Supervisors are not paid minimum wage and overtime; cannot be members of a union; and make the company liable for their actions like sexual harassment. Organized Labor has pushed the NLRB to narrowly define supervisor, but the Supreme Court rejected previous definitions as inconsistent with the text of the NLRA. In Oakwood Healthcare Inc, the NLRB modified the definitions of "assign," "responsibly direct," and "independent judgment" (all used to determine a supervisor) to conform to the Supreme Court rulings in NLRB v. Kentucky River Comty. Care, Inc. and NLRB v. HCR.

The RESPECT Act would make three major changes to the current definition. It would eliminate the two most common supervisory duties- the authority "to assign" other employees, and the authority to "responsibly to direct" other employees. In addition, the RESPECT Act would require that the "majority of a supervisor's work time" be spent engaging in the remaining duties outlined in the NLRA definition below.

The new definition of “supervisor” under Section 2(11) of the NLRA would read as follows:

Any individual having authority, in the interest of the employer, and for a majority of the individual’s worktime, to hire, transfer, suspend, lay-off, recall, promote, discharge, assign, reward, or discipline other employees, or responsibly to direct them,or to adjust their grievances or effectively to recommend such action, if in connection with the foregoing the exercise of such authority is not of a merely routine or clerical nature, but requires the use of independent judgment.


Changing the definition of “supervisor” would significantly affect many workplaces by:

  • Create divided loyalties among front-line supervisors who assign work to employees. Under the RESPECT Act, such supervisors would be covered by the NLRA and could then form, join or assist labor organizations; be eligible to vote in NLRB supervised elections; solicit signatures for union authorization cards from "co-workers;" or picket, go on strike or engage in other work stoppages that would be inconsistent with a supervisor's duty.
  • Fundamentally tip the balance between the dual functions of the national labor policy: (1) to protect the rights of rank-and-file employees in exercising their rights to form, join or assist a union without managerial or supervisory interference, while at the same time (2) ensuring supervisors act as agents in the interests of their employers in matters of labor-management relations.
  • To the extent that the NLRA definition is changed, there may also be changes to the FLSA’s definition, triggering litigation involving individuals currently classified, as "supervisors" but who may not meet a new definition.

Organized Labor’s legislative wish list includes the Re-Empowerment of Skilled and Professional Employees and Construction Trades workers ("RESPECT") Act, along with similarly misnamed Employee Free Choice Act.   Candidate Obama supports both acts; while Candidate McCain opposes them. The addition of supervisors to the ranks of potential union members and the ease of organizing workforces without a secret ballot election would dramatically change the balance of labor management relations. It would also greatly increase the dues collected by unions from organized employees.

Legal System to Blame for Humorless Work Environment?

Hard economic times, perpetual threat of layoffs, workers stretched too thin could all be contributing to the “increasingly humorous American workplace” according to MSNBC author Eve Tahmincioglu in her post No joke! The workplace needs a good laugh. However, others are pointing to our legal system’s clamp down on “hostile work environments” as the cause of a joyless workplace:

What’s exacerbating the joylessness this recession has spawned, some believe, is decades of joke slap-downs in offices and factories. “The whole issue of political correctness has gone too far when it comes to the criteria for determining an offensive comment,” says Thierry Guedj, workplace psychology expert and professor at Boston University. “If anybody is offended, then it’s offensive. The criteria has become much too personalized. It only takes one person being slightly upset at something for it to become offensive.” It started in the 1980s, he continues, got worse in the 1990s and “has now reached its maximum.”

It is true that more claims of workplace harassment are being filed. The EEOC received 27,112 charges of harassment in 2007, up almost 18% from the prior year. Employer’s settlement payments of $65.6 million for these charges are no laughing matter. From a legal perspective, should employees be worried about injecting humor into the workplace and is an employer’s “joke slap-down” necessary? If your humor doesn’t demean people based on their membership in a protected class, then joke away.

It is the “off-color jokes” and other “humor” related to gender, race, national origin, religion or other protected classifications that can be considered harassment. These types of comments always find their way into allegations of discrimination or harassment when a complaint is filed. However, there is an important distinction between remarks uttered by a supervisor (quid pro quo harassment) verses those spoken by a co-worker (hostile environment harassment).

Potentially discriminatory remarks or jokes spoken by a decision maker are evidence of discriminatory motive in adverse employment decisions as noted by the Supreme Court in Ash v. Tyson Foods. A couple of off-color jokes followed up by a disciplinary suspension may give a discrimination charge some merit. On the other hand, mere utterance of a joke or other inappropriate remarks by a co-worker may not sufficiently affect conditions to create a hostile environment as noted in Meritor Savings Bank v. Vinson.   But that’s your risk.

According to EEOC Policy Guidance, a "hostile environment' harassment takes a variety of forms, many factors may affect this determination, including: (1) whether the conduct was verbal or physical, or both; (2) how frequently it was repeated; (3) whether the conduct was hostile and patently offensive; (4) whether the alleged harasser was a co-worker or a supervisor; (5) whether the others joined in perpetrating the harassment; and (6) whether the harassment was directed at more than one individual. 

Severity and the pervasiveness of alleged hostile activities are the focus of the legal analysis. This is a very fact sensitive inquiry which depends in part on what a reasonable person would find offensive. For example, the New Jersey Supreme Court has held that some racial slurs and jokes are so historically offensive that their use in the workplace, even once, can lead to liability for an employer who doesn’t respond appropriately. A single utterance of an epithet can create a hostile work environment if it is viewed as “severe” and it is aimed at the individual rather than a generalized comment.  

Professor Guedj is correct that workplace humor has changed; but, perhaps the change was needed.  The impact of hypersensitivity is theoretically mitigated by the reasonable person standard.  However, the gray of the law may have led some workplace humorist to abstinence. Alternatively, practicing “safe humor” could include the following prophylactic measures:

  • Evaluate the content of the humor; some words and subjects are never appropriate for the workplace.
  • Know your audience.
  • Save your stand up routine for the comedy club where patrons are willing participants.
  • Don’t make jokes personal by singling out one individual as the butt of your humor.
  • Stop joking with people who seem uncomfortable with it.
  • Don’t ridicule co-workers who don’t like your humor
  • Try ask whether someone is offended by the humor.
  • If a co-worker’s joke offends you, then say something to the jokester.
  • Don’t e-mail jokes to everyone in the office.
  • Take seriously complaints about inappropriate humor, but remember the conduct must offend a reasonable person.