EEOC Rules Sexual Orientation Discrimination Prohibited

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By R. Joseph Leibovich
(901) 328-8269

Employers cannot discriminate against employees on the basis of sexual orientation, according to a ruling by the Equal Employment Opportunity Commission (EEOC).  The question is, will this ruling ultimately persuade federal courts to agree?

No federal law currently explicitly prohibits employment discrimination on the basis of sexual orientation.  Several states do have such laws.

The case in question involved a federal air traffic controller who claimed he was denied a permanent position, in part, because he is gay.  In a 3-2 opinion, the Commission held that discrimination on the basis of sexual orientation because it is gender based discrimination, which is illegal under Title VII of the Civil Rights Act of 1964.

In coming to this conclusion, the Commission noted that sexual orientation discrimination directly relates to gender.  The opinion stated

For example, assume that an employer suspends a lesbian employee for displaying a photo of her female spouse on her desk, but does not suspend a male employee for displaying a photo of his female spouse on his desk.  The lesbian employee in that example can allege that her employer took an adverse action against her that the employer would not have taken had she been male.That is a legitimate claim under Title VII that sex was unlawfully taken into account in the adverse employment action.

In addition to this, the Opinion applied cases involving race discrimination to note that discrimination based on sexual orientation was “associational” discrimination.  That is, discrimination based on associating with an individual who is in a protected class.  In addition, the Commission stated that sexual orientation discrimination can be based on gender stereotypes, and is therefore illegal.

The EEOC’s decision only directly applies to federal employees.  However, federal courts do give deference to the Commission’s interpretation of Title VII.  Certainly, all the federal circuits could either accept or reject the EEOC’s interpretation.   Any courts that disagree with the Commission decision could find that had Congress intended to provide protection for sexual orientation in Title VII, it would have explicitly done so.

The likely result of this will be a split in the federal circuits, which would probably lead to the Supreme Court having the final say.  Of course, new legislation could moot this issue one way or the other.

Until this issue is clarified legislatively or by the Supreme Court, private employers covered by Title VII – those with 15 or more employees – should be aware that the EEOC’s decision has put sexual orientation discrimination on the table, and the agency will likely accept charges based on such alleged discrimination.

Now may be a good time to review policies and training to attempt to minimize potential exposure for the new charges and litigation that are almost certain to ensue.

Supreme Court Rules Religious Accommodation Does Not Require Actual Knowledge By Employers

By R. Joseph Leibovich
(901) 328-8269

The United States Supreme Court on June 1 issued a ruling on religious accommodations under Title VII of the Civil Rights Act of 1964 that should effect how employers make hiring decisions.

In EEOC v. Abercrombie & Fitch Stores, the clothing store refused to hire Samantha Elauf, a practicing Muslim.  At the time she applied for a position she was wearing a head scarf as mandated by her religion.  The individual interviewing her was concerned this violated Abercrombie & Fitch’s “Look” policy, that forbids caps.

Although no one asked Ms. Elauf what her religion was, the interviewer told her superiors that she felt the scarf was likely due to religious reasons.  She was told that the scarf would violate the Look policy, and she was told not to hire Ms. Elauf.

The EEOC sued Abercrombie & Fitch alleging religious discrimination against Ms. Elauf, and the agency won on summary judgment.  The Tenth Circuit reversed, holding that an employer cannot be liable for failing to provide a religious accommodation if it has no actual knowledge of the need for one.

The Supreme Court reversed the Tenth Circuit in an 8-1 opinion written by Justice Scalia.  The opinion held that actual knowledge is not required, and  “Instead, an applicant need only show that his need for an accommodation was a motivating factor in the employer’s decision.”

Therefore, a “neutral” policy can lead to a disparate-treatment claim when an employer decides not to hire a person because of potential religious accommodations.  As the Court explained,”…the rule for disparate-treatment claims based on a failure to accommodate a religious practice is straightforward: An employer may not make an applicant’s religious practice, confirmed or otherwise, a factor in employment decisions. For example, suppose that an employer thinks (though he does not know for certain) that a job applicant may be an orthodox Jew who will observe the Sabbath, and thus be unable to work on Saturdays. If the applicant actually requires an accommodation of that religious practice, and the employer’s desire to avoid the prospective accommodation is a motivating factor in his decision, the employer violates Title VII.”

Employers need to realize that merely avoiding asking someone’s religion will not shield them from liability if they are, indeed, refusing to hire a person to avoid a religious accommodation.  In short, a neutral policy and claiming ignorance of an applicant’s religion will not protect employers if they decide not to hire someone because of a perceived religious accommodation, even if the employer technically does not know for sure that the individual is even a member of that religion.  The courts will be analyzing an employer’s intent, and not it’s knowledge, and that can make things very interesting.

 

The Donald Sterling Saga: A Breakdown Of Some Legal Issues

By R. Joseph Leibovich
(901) 328-8269

We all know the story by now.  The girlfriend of Los Angeles Clippers owner Donald Sterling recorded a conversation with Sterling in which he made racist comments.

The recording somehow made its way to the public, igniting outrage from players and the public.  Three days later, NBA Commissioner Adam Silver announced that Sterling is banned for life from the NBA, that he must pay $2.5 million in fines and that Silver will take steps to force Sterling to sell his stake in the Clippers.

This whirlwind drama has led people to ask a lot of legal questions.  Let’s take a look at some of the interesting ones.

I.  Did the NBA violate Sterling’s First Amendment rights?

In short, the answer is no.

Public figures have routinely been smacked for making ill advised comments over the years.  And, every time a Paula Deen, a Phil Robertson, or a Donald Sterling are dealt consequences for their comments, a lot of people argue that their right to free speech has been abridged.

The First Amendment states that “Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.”

The First Amendment applies to federal and state governments. (There’s an explanation of how the First Amendment can apply to states. I don’t want to get into the whole thing here, but, trust me, it’s been incorporated to include state governments).    But, the First Amendment does not apply to private entities, such as the Food Network, A&E or the NBA.

So, there’s no First Amendment issue here.  Move along.

II.  How Can the NBA Get Rid Of An Owner?

Well, this is an interesting question.

Until the Sterling brouhaha emerged, the NBA had managed to keep its Constitution and By-Laws “secret”.  However, the League has since released the document to the public.  It’s 79 pages long, and I’m not going to pretend to have read the whole thing.  If you want to, knock yourself out. Here it is.  http://mediacentral.nba.com/media/mediacentral/NBA-Constitution-and-By-Laws.pdf

Relevant to the Sterling situation is Article 13, titled, appropriately enough, “Termination of Ownership or Membership”.  This Article sets out a number of reasons the League (called “the Association” in the document) can terminate ownership interests.  It appears that the NBA will rely on this in its efforts to get Sterling to divest:

The Membership of a Member or the interest of any Owner  may be terminated by a vote of three fourths (3/4) of the Board of Governors if the Member or Owner shall do or suffer any of the following:

(d) Fail or refuse to fulfill its contractual obligations to the Association, its Members, Players, or any other third party in such a way as to affect the Association or its Members adversely.

So, if Sterling breached a contract with the League, then there’d be grounds to terminate his ownership interest.  And the League has taken the position that is the case.

But, what contractual obligations has Sterling violated?  ESPN is reporting that when Sterling bought the Clippers in 1981, he signed some documents that include a “morals clause” and a clause indicating that owners will not take any position that could materially adversely affect a team or the League. Presumably the NBA will say that Sterling’s comments fall into this category, and, therefore he violated his contract with the NBA.

Is this argument a slam dunk? (Sorry, but one basketball metaphor was inevitable).  Probably not.

Sterling will likely claim that a private conversation with his mistress should not be deemed to be him “taking a position”.  It was not a public declaration, after all.  Will this argument carry the day if this matter gets to court? That is difficult, if not impossible, to say.  But, if the parties decide this matter is to be determined through litigation, we can expect a serious fight.

III.  Does Sterling Expose The Clippers To Discrimination Claims?

For the sake of this discussion, let’s assume Sterling is a racist.  I am certainly not going to argue this fact one way or the other.  The recording speaks for itself.  Draw your own conclusions from it and give whatever weight you feel is appropriate to prior lawsuits against Sterling involving housing discrimination, and allegations of prior racist comments.  But for purposes of this discussion, let’s assume racism.

If Donald Sterling is a racist, and if his employees know it, is that a problem?

Well, sure.

The Clippers organization includes several African-Americans and other minorities.  The Clippers employ more people than the players  on the court. Apart from the players and coaching staff, there’s marketing, ticket people, administration and so on.  It’s a lot bigger of an organization than you see during a game.

What, if any, effect does having someone who is publicly deemed to be a racist have on a workplace?

Let’s take the obvious path first.  If Sterling had not been banned, and were to walk up to Clippers coach Doc Rivers (who is African-American) and were to fire him for whatever reason, could Rivers allege he was terminated due to his race and file a claim under Title VII of the Civil Rights Act or state law?  Sure he could.

 And what would part of his proof be?  It would include evidence that the guy who fired him had demonstrated racial animus, and that whatever reason he gave for the termination was a mere pretext for discrimination.   Does this mean he’d win the case?  Not necessarily.  But it could give a court a basis for denying summary judgment.  So, keeping Sterling on could have exposed the Clippers to extended litigation in the future.

But, let’s say that Sterling didn’t fire anyone.  Let’s assume he has never said a racist word to any Clippers employees, and that he has never once made an employment decision that can be attributed to race.  Could an employee somehow claim that Sterling has created a “hostile work environment” due to his private comments?

It seems highly unlikely.

In general, to establish a claim of a racially based hostile work environment, a plaintiff must show:
1.  He or she is a member of a protected class;

2.  He or she was subjected to unwelcome racial harassment;

3.  The harassment was based on race.

4.  The harassment unreasonably interfered with his or her work performance by creating an intimidating, hostile, or offensive work environment; and

5.  The employer is liable.

Examining a workplace where you have someone deemed to be a known racist as an owner or supervisor, we have to ask could the mere fact that they are a racist expose an organization to liability or that fact alone?  I think the answer is no.

As long as the individual leaves their racism at home and doesn’t spread those thoughts in a work setting, absent action, liability seems unlikely.

So, could a member of the Clippers organization who suffered no tangible job action sue the Clippers on the basis of a hostile work environment simply because Donald Sterling made racist comments privately to his paramour?  Not likely.

But , is every employment decision Sterling made in relation to an African-American now subject to attack based on his comments?  Possibly.

And, beyond the employment realm, has Sterling arguably violated Title II of the Civil Rights Act of 1964?  That section prohibits discrimination on the basis of race in places of public accommodation.  Did Sterling, by telling his girlfriend to not bring black people to games somehow violate Title II?  Seems unlikely, but it’s certainly interesting to consider the argument.

The Sterling case provides a lot of fertile ground for legal debate.

But, beyond the legalities, the key take away here is that if you own a business or work in management, it’s probably a good idea to avoid spouting off racist comments, even privately.  You never know who is recording you and when.

After all, if you can’t count on your mistress who is about a half century younger than you to be discreet, who can you trust?

Supreme Court Limits Vicarious Liability In Harassment Cases

By Joe Leibovich
(901) 328-8269

The United States Supreme Court has narrowed the definition of who is a supervisor for purposes of sexual harassment cases.  The effect of this is that employers will have an easier time defending sexual harassment cases.

The Court in Vance v. Ball State University, 570 U.S. _____ (2013), took on a question left open by prior decisions Burlington Industries, Inc. v. Ellerth, 524 U.S. 742 (1998) and Faragher v. Boca Raton, 524 U.S. 775 (1998).

Both Ellerth and Faragher dealt with when a company can be held responsible for sexual harassment.  In these cases, the Court held that employers are vicariously liable for harassment by a supervisor when it leads to a tangible employment action, including firing, hiring, failure to promote, job reassignment, or loss in benefits.  In such cases, an employer is strictly liable for the harassment, whether or not the employer knew about the harassment.

Furthermore, the Court previously held that a company is vicariously liable for “hostile work environment” harassment by a supervisor, even where there is no tangible job employment action.  In such cases, employers can attempt to raise a defense (which is the employer’s burden to prove) that the employer exercised reasonable case to prevent and correct harassing behavior, and that the plaintiff failed to take advantage of such opportunities.

In cases of non-supervisor harassment, courts look to whether or not the employer knew or should have reasonably known about the harassment, but failed to take remedial action.

So, it becomes important to know who is and is not a supervisor when defending claims of sexual harassment.

Today’s decision in Vance stated:

“We hold that an employer may be vicariously liable for an employee’s unlawful harassment only when the employer has empowered that employee to take tangle employment actions against the victim…”

In doing this, the Court rejected the EEOC’s definition of “supervisor,” which lower courts had been utilizing.  Under that definition, a supervisor was one who had the ability to exercise significant direction over an employee’s work. This could have led to situations where a co-worker who had some oversight, even for a short period, could be deemed to be a supervisor.

The Court’s 5-4 decision by Justice Alito is a victory for employers, but by no means signals that employers can not be liable for non-supervisory harassment.  The Court stated “As an initial matter, an employer will always be liable when its negligence leads to the creation or continuation of a hostile work environment.  And even if an employer concentrates all decisionmaking authority in a few individuals, it will likely not isolate itself from heightened liability under Faragher and Ellerth.  If an employer does attempt to confine decisionmaking power to a small number of individuals, those individuals will have a limited ability to exercise independent discretion when making decisions and will likely rely on other workers who actually interact with affected employees. … Under those circumstances, the employer may be held to have effectively delegated actions to the employees on whose recommendations it relies.”

Overall, Vance does not change the landscape much.  But it does provide some help to employers for the actions of individuals who can’t directly or indirectly take tangible job actions against employees or applicants.

While Vance gives employers some comfort, it is important for employers to continue to provide an avenue for reporting harassment that will lead to proper investigations and results.  An employer can not simply turn a blind eye to an atmosphere charged with sexual harassment.  And, employers still need to be aware that even if an individual can not directly fire or discipline an employee, that individual may still be a supervisor if their input is given weight in employment decisions.  Proper policies and training remain invaluable in this context.

EEOC Files Lawsuits Over Background Checks

By Joe Leibovich
(901) 328-8269

The EEOC has filed two lawsuits, including one against Tennessee based Dollar General Corp., over the use of criminal background checks.  The lawsuits filed this week against Dollar General and BMW essentially allege that the background checks have a disparate impact on minority employees and applicants.

The EEOC takes the position that background checks affect African Americans adversely due to disparities in arrest and convict rates between minority and White individuals.

The Agency issued guidance to employers in April 2012 regarding the use of criminal background checks.  In that guidance, the EEOC reiterated its position that the fact of an arrest has little meaning, as that does not provide proof of criminal wrongdoing.

On the other hand, a conviction is reasonable proof that the person did what they were accused of.

But, according to the Agency, that alone is not enough in light of the disparate impact on African Americans.  The EEOC turned to a 1977 Eighth Circuit case, Green v. Missouri Pacific Railroad, 549 F.2d 1158 (8th Cir. 1977), to describe when the use of criminal background checks may be valid.  The EEOC listed three Green factors

1.  The nature and gravity of the offense or conduct;

2.  The time that has passed since the offense or conduct and/or completion of the sentence; and

3.  The nature of the job held or sought.

The guidance went in depth into each of these factors, and ultimately provided a set of “Employer Best Practices”.  The EEOC states employers should:

  • Eliminate policies or practices that exclude people from employment based on any criminal record.
  • Train managers, hiring officials, and decisionmakers about Title VII and its prohibition on employment discrimination.
  • Develop a narrowly tailored written policy and procedure for screening applicants and employees for criminal conduct.
  • Identify essential job requirements and the actual circumstances under which the jobs are performed.
  • Determine the specific offenses that may demonstrate unfitness for performing such jobs.
  • Identify the criminal offenses based on all available evidence.
  • Determine the duration of exclusions for criminal conduct based on all available evidence.
  • Include an individualized assessment.
  • Record the justification for the policy and procedures.
  • Note and keep a record of consultations and research considered in crafting the policy and procedures.
  • Train managers, hiring officials, and decisionmakers on how to implement the policy and procedures consistent with Title VII.
  • When asking questions about criminal records, limit inquiries to records for which exclusion would be job related for the position in question and consistent with business necessity.
  • Keep information about applicants’ and employees’ criminal records confidential. Only use it for the purpose for which it was intended.

The EEOC has indicated this issue is a high priority for the Agency.  And these new lawsuits would seem to indicate that is the case.  Both Dollar General and BMW deny their policies are unlawful.

It is certainly not possible to predict whether or not the EEOC’s lawsuits will ultimately prevail.  But, it is vital for employers to note that the EEOC is looking at these policies.  Both lawsuits do stem from individual complaints, but it is possible the Agency could aggressively pursue employers over this issue.

In any event, and certainly while we wait for the results of this litigation, employers should take a look at their background check policies to see if they are in compliance with the EEOC’s guidance.