Nadine Roddy—Senior Attorney, National Legal Research Group
John Buckley—President, National Legal Research Group

            A federal district court sitting in Pennsylvania has held that an employer may proceed with its unfair competition suit asserting contract and tort claims against a former employee and the employee’s current employer. The employer adequately stated claims of common-law breach of fiduciary duty and unfair competition against the employee, and of aiding and abetting the same against the competitor. However, the employer’s claim of tortious interference with prospective contractual relationship against the employee would be dismissed because the complaint failed to allege a sufficient likelihood of a prospective contract. Neopart Transit, LLC v. CBM N.A., Inc., 314 F. Supp. 3d 628 (E.D. Pa. 2018).

Matthew McDavitt, Senior Attorney, National Legal Research Group

            In circumstances where an employer subject to the workers' compensation mandate fails to obtain the requisite insurance coverage, such noncompliance can have serious legal consequences. By statute in many states, such noncompliance deprives the employer of the standard employer tort defenses barring a defendant employer from asserting (1) an assumption of risk, (2) the fellow servant rule, and (3) contributory negligence in a tort suit brought by an injured worker.

            From a policy perspective, this statutory defensive penalty was intentionally enacted so as to materially disadvantage noncompliant employers at trial (by removing an employer’s preferred tort defenses), thereby encouraging employers to participate in the system. Bath Mills v. Odom, 168 F.2d 38, 39-40 (4th Cir. 1948); Blinkinsop v. Weber, 85 Cal. App. 2d 276, 279, 193 P.2d 96, 97 (1948).

Nicole D. Prysby, Senior Attorney, National Legal Research Group 

            On September 20, 2017, the Seventh Circuit Court of Appeals affirmed a decision by a district court, holding that the failure to provide an employee with long-term medical leave is not a violation of the Americans with Disabilities Act ("ADA"). The decision, Severson v. Heemployartland Woodcraft, Inc., No. 15-3754, 2017 WL 4160849 (7th Cir. Sept. 20, 2017), rejects the Equal Employment Opportunity Commission ("EEOC") position that long-term medical leave may qualify as a reasonable accommodation.

            Severson worked for Heartland Woodcraft, Inc., in a position for which heavy lifting was an essential function. In 2013, he took 12 weeks of Family and Medical Leave Act ("FMLA") leave due to back pain. On the last day of leave, he had back surgery, which required that he take another two to three months of leave from work to recuperate. He asked if he could continue his medical leave, but because he had exhausted his FMLA leave, Heartland denied the request and told him that he could reapply for a position once he was medically cleared to work.

Nicole Prysby, Senior Attorney, National Legal Research Group

     In interpreting the coverage of Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e, appellate courts have held that the prohibition against discrimination based on sex does not encompass discrimination based on sexual orientation. E.g., Simonton v. Runyon, 232 F.3d 33 (2d Cir. 2000); Blum v. Gulf Oil Corp., 597 F.2d 936 (5th Cir. 1979). In December 2012, however, the Equal Employment Opportunity Commission ("EEOC") took the opposite position in a Strategic Enforcement Plan that prioritized enforcement of discrimination against lesbian, gay, bisexual, and transgender employees under the sex discrimination provisions of Title VII. Since that time, the EEOC has filed a number of lawsuits alleging discrimination against gay and lesbian employees and has consistently maintained that Title VII's prohibition of discrimination based on sex protects employees against discrimination based on sexual orientation. See, e.g., Complainant v. Anthony Foxx, Secretary, Dep’t of Transp. (Fed. Aviation Admin.), Agency, EEOC DOC 0120133080, 2015 WL 4397641 (July 15, 2016).

            In April 2017, the Second Circuit, relying on Simonton, held that Title VII does not prohibit discrimination based on sexual orientation. Zarda v. Altitude Express, 855 F.3d 76 (2d Cir. 2017). The court also noted that a separate panel had held that Simonton could only be overturned by a Second Circuit en banc decision.

            Similarly, the Eleventh Circuit held in March 2017 that a lesbian employee was not protected under Title VII against discrimination based on her sexual orientation. Evans v. Ga. Reg’l Hosp., 850 F.3d 1248 (11th Cir. 2017). In the Evans decision, the court cited a 1979 case that held that discharge for homosexuality is not protected by Title VII, Blum v. Gulf Oil Corp., 597 F.2d 936, 938 (5th Cir. 1979) (adopted as binding precedent for the Eleventh Circuit in Bonner v. City of Prichard, 661 F.2d 1206, 1209 (11th Cir. 1981), and found that it was bound to follow the ruling in Blum unless that decision is overruled by an en banc holding of the Eleventh Circuit.

John Stone, Senior Attorney, National Legal Research Group

     As with most forms of employment discrimination, an employer's retaliation against an employee for asserting discrimination under the Equal Pay Act ("EPA") gives rise to an additional and distinct cause of action for the employee. To state a claim for retaliation under the EPA (as incorporated into the Fair Labor Standards Act), a plaintiff must plausibly allege (1) engagement in protected activity, (2) materially adverse action that might well have dissuaded a reasonable worker from making or supporting a charge of discrimination, and (3) causality.

     A showing of the causality element requires either (1) that the retaliation closely followed the protected activity, or (2) that the plaintiff put forth a sufficient explanation for the delay between the protected activity and the alleged retaliation. Where the time between the protected conduct and the alleged retaliation is too great to establish causation based solely on temporal proximity, a plaintiff must present other relevant evidence to establish causation, such as continuing retaliatory conduct and animus in the intervening period. In addition, when there may be valid reasons why an adverse employment action was not taken immediately, the absence of immediacy between the cause and the effect does not disprove causation in a retaliation case.

Suzanne Bailey, Senior Attorney, National Legal Research Group

     For almost 80 years, the National Labor Relations Board ("NLRB" or "Board") has awarded "search-for-work" and "interim employment" expenses as part of its broad discretionary authority under section 10(c) of the National Labor Relations Act ("NLRA"), 29 U.S.C. § 160(c), to provide a make-whole remedy for those injured by unfair labor practices in violation of section 8 of the NLRA, 29 U.S.C. § 158. See Crossett Lumber Co., 8 N.L.R.B. 440, 497-98, enforced, 102 F.2d 1003 (8th Cir. 1938). Such expenses include, for example, increased transportation costs necessitated by seeking or commuting to interim employment, room and board while seeking employment and/or working away from home, and the cost of moving if necessary to assume interim employment. During those almost-80 years, the NLRB has awarded these expenses to those individuals who have suffered discrimination under section 8 of the NLRA in the form of an offset to interim earnings, rather than as a separate element of a back-pay award. The result of treating the award as an offset to interim earnings was that (1) individuals who were unable to find interim employment did not receive any compensation for their search-for-work expenses, and (2) individuals who found jobs that paid wages lower than the amount of their expenses did not receive full compensation for the search-for-work and interim employment expenses

     EEOC announced that McDonald’s will pay $56,500 and other relief to settle a disability discrimination lawsuit in which EEOC alleged that the company refused to hire a deaf applicant. The applicant, a man who is unable to hear or speak, had previous experience working at another McDonald’s. When the manager discovered that the young man needed an interpreter for the interview, she canceled the interview, even though the applicant’s sister had volunteered to act as an interpreter for the interview. The applicant made several (unsuccessful) attempts to reschedule the interview and McDonald’s continued to interview other applicants throughout that time period.

 For additional information, see the EEOC press release.

     Title VII protects employees from discrimination based on their religion (or lack of religious belief). A U.S. District court recently clarified that for the purposes of discrimination, a belief system called “Onionhead” is a religion. The defendant in the case is a small company that decided its corporate culture was deteriorating. The company hired a relative of the CEO to assist with morale and she brought Onionhead, a program she had developed, to the workplace. The company asserted that Onionhead is a conflict resolution tool. The plaintiffs asserted that it is a system of religious beliefs and practices. There were a series of Onionhead workshops, prayers, and meetings in the workplace, which the defendant said were voluntary but plaintiffs characterized as mandatory. Some plaintiffs described being told not to use overhead lighting "to prevent demons from entering the workplace through the lights." Plaintiffs also cited many other instances where spiritual language was used in Onionhead training. Plaintiffs contended that they were fired for either rejecting Onionhead beliefs or for having their own, non-Onionhead religious beliefs. The court found that the Onionhead set of beliefs did constitute a religion, based on a two-factors analysis: (1) whether the beliefs are sincerely held and (2) whether they are, in the believer’s own scheme of things, religious. The court stated that as a matter of law, the Onionhead beliefs are religious. On the issue of sincerity, the court found that there was a factual dispute and that a reasonable factfinder could find that the beliefs were sincerely held. For background on this case, see the EEOC’s new release: https://www.eeoc.gov/eeoc/newsroom/release/6-11-14.cfm    

     There have been similar cases in the past in this same vein. For example, in one case, the Eighth Circuit upheld a jury verdict that an employer that used Mind Body Energy (MBE) training sessions had discriminated against an employee on the basis of religion. The employer, a home builder and seller, required employees to participate in MBE sessions to "cleanse negative energy." The sessions included reading Hindu and Buddhist literature and affirming the belief in past lives. The employee complained that the sessions conflicts with his religious beliefs and he declined to participate in them. He was subsequently terminated. The Eighth Circuit noted that although there was some conflicting testimony as to the reasons for the employee’s termination, the fact that the employer kept attendance records for the sessions and the fact that the sessions were reasonably perceived by employees as required, was sufficient basis for a jury to find in the employee’s favor. Ollis v. HearthStone Homes, Inc., 495 F.3d 570 (8th Cir. 2007).     

     As these cases show, employers must take care to screen any training programs and accommodate any employees who give notice that these programs are inconsistent with the employees’ religious beliefs, whether or not the employer believes there is a religious basis for the employee’s objection.

      The EEOC announced that it has charged Detroit’s Greektown Casino with violating the Americans with Disabilities Act (ADA). The casino allegedly fired a pit manager who was on leave for a stress-anxiety disorder and requested several more weeks of leave. The casino denied the leave and fired him. For more information, see the EEOC’s press release:

https://www.eeoc.gov/eeoc/newsroom/release/10-4-17a.cfm

    The EEOC announced that it has released the latest edition of the Digest of Equal Employment Opportunity Law (EEO Digest), featuring an article on “Discrimination on the Basis of Mental Health Conditions Under the ADA and Rehabilitation Act.” The article discusses some cases specifically dealing with how to accommodate employees with mental health conditions, including modified work environments, use of leave, and reassignment. The digest is available at:

https://www.eeoc.gov/federal/digest/vol_4_fy2016.cfm#article