Washington Supreme Court Confirms Higher Standard for Harassment at a “Place of Public Accommodation”

Under the Washington State Law Against Discrimination (“WLAD”), the statute prohibits “places of public accommodation” discriminating against individuals on the basis of sex, race, national origin, and sexual orientation. RCW 49.60.215. “Places of public accommodation” is broadly defined and includes all facilities or businesses used by or open to the public. Sexual harassment is a form of sex discrimination prohibited under the WLAD.

On January 31, 2019, the Washington Supreme Court confirmed there is a higher standard for acts of sexual harassment committed in places of public accommodation. In Floeting v. Group Health, Inc., 192 Wn.2d 848, 434 P.3d 39 (Wash. Sup. Ct. 2019), the Court held that employers are strictly liable for the actions of even non-management employees who harass customers or members of the public in places of public accommodation.

The test for showing sexual harassment in a place of public accommodation requires that the:

  1. The member of the public is a member of a protected class;
  2. Employer’s establishment is a place of public accommodation;
  3. Employer discriminated against the customer or member of the public when it did not treat him/her in a manner comparable to the treatment it provides to persons outside of that class; and
  4. Person’s protected status was a substantial factor that caused the discrimination.

To be actionable, the Court held that the discriminatory conduct “must be of a type, or to a degree, that a reasonable person who is a member of the plaintiff’s protected class, under the same circumstances, would feel discriminated against. This is an objective standard.” Id. at 858 (emphasis in original). Under this “reasonable person” standard, it seems that a single incident could result in liability.

In contrast, employers have several opportunities to show they were not at fault in cases of employee workplace harassment under the WLAD. For example, employer can show that:

  1. The conduct did not affect the terms or conditions of employment;
  2. The harassment was not severe or pervasive;
  3. That the employer did not authorize, know of, or have the ability to know of the harassment or, if it did,
  4. The employer took reasonable prompt and corrective action.

The majority opinion stated the strict liability standard should motivate employers in public accommodations to implement quality training and supervision as well as effective procedures for reporting harassment and/or discrimination.

In this zero-tolerance context, employers should obtain counsel to re-evaluate anti-harassment and anti-discrimination policies to highlight public accommodation issues.

New Jersey Hotels Must Provide “Panic Buttons”

New Jersey Governor Murphy signed Bill S-2986 into law on June 11, 2019 mandating that “larger” hotels protect workers from sexual violence, assault, and other acts of harassment and violence that can occur on hotel premises by co-workers and/or guests. A copy of the law can be seen by clicking here. The law notes that “[d]ue to the unique nature of hotel work, hotel employees are particularly vulnerable to unsafe working conditions because they often work alone in hotel guest rooms, which sometimes may be occupied. This solitary work places them at risk of assault, including sexual assault, and sexual harassment.” Qualifying hotels include “any hotel, inn, boarding house, motel or other establishment” with at least twenty-five (25) guest rooms. A covered hotel must provide a “panic button” (and training in its use) to summon help if an employee reasonably believes “there is an ongoing crime, harassment, or other emergency….” An employee is legally authorized to leave any area where there is a perceived danger; retaliation is prohibited.

Although New Jersey is the first state to mandate these protections, the idea is not unique. In October 2017, the Chicago City Council passed a “panic-button” ordinance. In August 2018, California introduced its own “panic button” bill, but it stalled at the Senate’s Appropriations Committee. In California, though, Sacramento and Long Beach enacted similar ordinances.

Second Circuit: ADA Allows Hostile Work Environment Claims

The Second Circuit recently held that the Americans with Disabilities Act (“ADA”) encompasses claims for hostile work environment harassment (“HWE”). Fox v. Costco Wholesale Corporation. While this plaintiff-friendly ruling may be disappointing to employers, the decision also contains some helpful analysis for defense of those claims.

In Fox, Plaintiff brought ADA claims alleging discrimination, failure to accommodate, and hostile work environment. Dismissing the discrimination claim, the Court held, among other things, that the four verbal reprimands received by Plaintiff did not rise to the level of adverse employment actions because none “resulted in disciplinary action or a reduction in salary, benefits or other responsibilities.” As to the failure to accommodate claim, the Court refused to impute knowledge of the need for an accommodation to the employer because Plaintiff never asked for an accommodation. Moreover, there was no proof that the employer should have offered an accommodation due to its unquestionable need. (It should be noted that state or local laws may be more employee-protective and could support a failure to accommodate claim merely because the employer was on notice of the medical condition).

With respect to HWE, the Court joined four other Circuit Courts in ruling that HWE claims can be asserted under the ADA, but noted that “[l]egitimate reprimands by an employer are not abuse.” Moreover, the Court noted that “teasing in the workplace is not uncommon, and in most instances probably not actionable.” Thus, the mere fact that Plaintiff was teased about his condition was not necessarily actionable harassment. But, since it might be, a trial was ordered as to the HWE claim.

Employers in the Second Circuit must be aware of the possibility of HWE claims under the ADA. As such, employers should update supervisor training to account for ADA hostile work environment claims.

U.S. Supreme Court: Employee May Proceed with Title VII Claim Despite Not Fulfilling EEOC Filing Obligation

The general rule is that a federal discrimination claim should be dismissed unless a timely charge was filed with the Equal Employment Opportunity Commission (EEOC). Whether that statutory requirement was jurisdictional (and could not be waived) or procedural (and must be presented to the Court in a timely manner or the defense is waived) was subject to judicial disagreement. Until today’s Supreme Court’s ruling in Fort Bend Cty. v. Davis, eight federal appellate courts ruled that the failure to exhaust administrative remedies was a procedural matter that would not necessarily bar a discrimination claim under Title VII. Three other appellate courts, however, had ruled that pre-suit claim exhaustion was a jurisdictional prerequisite to a court filing.

In Davis, plaintiff handwrote “religion” on the EEOC Charge intake questionnaire, but did not include that claim on the formal charge document. In 2012, Davis commenced a civil action in federal court alleging discrimination based on religion and retaliation for reporting sexual harassment. The District Court partially granted Fort Bend’s motion for summary judgment based on Davis’s failure to amend her charge to contain a claim for discrimination based on religion. The Court of Appeals for the Fifth Circuit reversed.

It was not until years into the litigation that Fort Bend sought dismissal due to the lack of federal jurisdiction because claimant had not stated a timely claim for religious discrimination in the EEOC charge. Rejecting this contention, the Supreme Court ruled that Title VII’s charge-filing requirement is not jurisdictional; it is procedural. Therefore, even though Title VII requires that a plaintiff file an administrative charge before filing a lawsuit, a case will not be dismissed unless the employer raises that objection in its Answer or by motion early in the case. In effect, assert the defense or forfeit it.

Second Circuit: Application of Neutral Policy Does Not Interfere with FMLA Rights

As recently reaffirmed by the U.S. Court of Appeals for the Second Circuit, neutral application of a policy to prorate incentive compensation contributions during leaves of absence does not unlawfully interfere with an employee’s rights under the Family and Medical Leave Act (FMLA).  In Clemens v. Moody’s Analytics, Inc., Plaintiff contended that he was denied benefits because his bonus was already “self-prorating” due to a reduced work period that naturally yielded a lesser bonus amount. In effect, he claimed, additional prorating was a doubled-reduction. Since the undisputed evidence showed that the employer’s prorating policy was neutrally applied based on the length of the employee’s leave (regardless of the reason for leave), there was no discriminatory interference with FMLA rights.

This decision serves as an important reminder that employers must review seemingly neutral policies (such as, for example, attendance or bonus policies) to consider the impact of those policies on employees on FMLA leave.

2019 EPLI Trends Report Published

Workplace law changes constantly. Employers and EPL carriers need to keep up with expanding risks, changing legal obligations, reason-defying jury verdicts, the #MeToo movement, and a record number of threatened and asserted claims associated with these changes. Our 2019 EPLI Trends Report gives an overview of the related risks and exposures employers and, by extension, carriers face in 2019.  Topics covered include:  Pay Equity Lawsuits, Medical Marijuana, Website Accessibility Lawsuits, Whistleblower Claims, Class Action Developments, Privacy and Data Breach Issues, and more.  See the full report by clicking here.

Hospital Privileges Do Not Confer Employment Status For Purposes of Title VII Liability, Seventh Circuit Holds

Having the power to grant, deny, or revoke hospital privileges does not give rise to liability under Title VII of the Civil Rights Act of 1964, according to a recent decision by the Court of Appeals for the Seventh Circuit. Yelena Levitin, M.D. v. Northwest Community Hospital.

For almost thirteen years, Dr. Yelena Levitin had performed surgeries at Northwest Community Hospital (the “Hospital”) as an attending physician. She had been granted privileges by the Hospital to send patients there for treatment and perform surgeries on her own patients there. The Hospital did not pay Dr. Levitin, she had her own medical practice, billed her patients directly, and filed taxes as a self-employed physician. She complained to Hospital leadership that a male surgeon had been harassing her. The Hospital reprimanded that physician and the alleged harassment ceased. Thereafter, other physicians filed complaints against Dr. Levitin related to her medical judgment. After further review of her practices, she was referred to the Medical Executive Committee, which voted to terminate her practice privileges.

Dr. Levitin filed suit, claiming, among other violations, that she suffered discrimination and retaliation under Title VII. The District Court granted the Hospital’s motion for summary judgment, determining that “the undisputed evidence showed that Levitin was not a Northwest employee, which put her discrimination claim outside of Title VII’s scope.” On appeal, the Seventh Circuit agreed.

In determining whether an individual is an employee for the purposes of Title VII, courts look to the economic realities of the circumstances. The Seventh Circuit acknowledged that there could be circumstances where an indirect employer-employee relationship is formed when a Hospital holds so much control over a physician’s privileges, such that it impacts the physician’s treatment decisions. The employer’s right to control is key to such an analysis. The facts in this case did not support such a conclusion. Notably, Dr. Levitin had complete independence: she set her own hours, could use her own staff, and could perform surgeries at and direct patients to other hospitals. As such, Dr. Levitin was deemed not to be an employee of the Hospital.

Older Employee Let Go in Reduction in Force Can Proceed to Trial on ADEA Claim

An employer’s retention of a younger, less-qualified employee instead of the older, more experienced employee, who was terminated during the Company’s reduction in force, can give rise to liability under the Age Discrimination in Employment Act (“ADEA”), according to a recent decision by the United States District Court for the Southern District of Texas. Harrison v. Chipolbrok America, Inc.

After a downturn in business, the Company conducted a reduction in force (“RIF”) terminating the 64-year-old Plaintiff, while retaining a 27-year-old employee. Plaintiff filed suit under the ADEA. The Company moved to have the case dismissed before trial, claiming that the Plaintiff was terminated due to the reduction in force and that Plaintiff was not qualified for the shipping associate position. The District Count denied defendants’ motion, stating the Plaintiff produced enough evidence to merit sending the age discrimination claim to trial. The Plaintiff presented evidence showing that she was qualified for the position including that Plaintiff’s manager wanted to keep Plaintiff on as a shipping associate and that Plaintiff actually trained the 27-year-old employee who was given the job over the Plaintiff. Additionally, there was testimony that the Company President allegedly stated that they did not want to keep Plaintiff on after the reduction in force because the 64-year-old employee was too old, too sick, and was costing the Company too much in medical expenses.

Before conducting a RIF, the company should carefully review its selection criteria and be sure it has support for its selection decisions. The mere statement that an employee was laid off with others as part of a RIF does not necessarily provide a complete defense.

Employee’s Receipt of Social Security Benefits May Prevent a Subsequent Claim for Disability Discrimination under the ADA

An employee who applies for and receives Social Security disability benefits may be judicially estopped from bringing a disability discrimination claim under the Americans with Disabilities Act (the “ADA”) according to a recent Louisiana District Court case. Tanner v. BD LaPlace, LLC.

Paul Tanner was separated from his employment with BD LaPlace LLC (“BD”) for job abandonment in March 2016 after he refused to submit to a mandatory fitness for duty evaluation (“FDDE”). Tanner was employed with BD as a crane operator. In 2016, BD received complaints of Tanner’s erratic workplace behavior. After investigation, BD required Tanner to undergo a mandatory FFDE. Tanner refused to comply with the testing. Accordingly, BD determined that Tanner had abandoned his position.

Tanner filed a charge for disability discrimination with the Equal Employment Opportunity Commission (“EEOC”) in September 2016. Seven months later, he applied for and received Social Security benefits in which he provided sworn testimony to the Social Security Administration (“SSA”) stating he became disabled on March 1, 2016. The SSA found that Tanner was, in fact, disabled, and backdated his disability to February 10, 2016. Tanner then filed suit alleging discrimination under the ADA.

The Court held that Tanner was precluded from bringing an ADA claim because of his sworn testimony provided to the SSA that he was “totally disabled” as of February 10, 2016. Relying on the Supreme Court’s decision in Cleveland v. Policy Mgt. Sys. Corp., 526 US 795, 806 (1999), the court here determined that it was Tanner’s responsibility to explain the contradiction, which he failed to do.

Employers should always request and review SSA records from a plaintiff. If a plaintiff has received Social Security benefits, an employer may use the plaintiff’s own sworn testimony provided to the SSA to defeat a disability discrimination claim.

Workplace Gossip May Lead to Title VII Liability, Fourth Circuit Holds

An employer’s failure to stop a false rumor that a female employee slept with her male boss in order to obtain a promotion can give rise to liability under Title VII of the Civil Rights Act of 1964, according to a recent decision by the Court of Appeals for the Fourth Circuit. Parker v. Reema Consulting Services, Inc.

Evangeline Parker was fired after complaining that male employees at Reema Consulting’s Virginia-based warehouse spread a false rumor that she was promoted because of a sexual relationship with a high-ranking male manager.  The facility’s highest-ranking manager allegedly not only knew of the gossip, but participated in spreading the rumor by discussing it at a group meeting and by blaming Parker for “bringing the rumor into the workplace.”

The District Court initially granted the employer’s motion to dismiss, ruling that although the workplace gossip was “truly offensive,” the rumor’s circulation was not based upon her gender and thus not unlawful under Title VII.  The Fourth Circuit disagreed and reversed, holding that because Parker “plausibly involved a deep rooted perception . . . that generally women, not men, use sex to achieve success” she adequately pleaded gender-based discrimination.  The Court also held that the conduct, as alleged, was sufficiently severe pervasive, as it persisted continuously for approximately two months.

Employers should be aware of their obligations to address potentially unlawful workplace rumors, and should consider training managers and human resources on how to take appropriate steps to stop such rumors without infringing on employees’ rights to discuss the terms and conditions of their employment.  For a more complete discussion of this case, please see our publication by clicking here.

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