U.S. Supreme Court Denies Certiorari Review of Bridgestone, Declining for a Second time to Consider a Challenge to PAGA

PAGA stays on track after Bridgestone

cert petition denied.

On June 1, 2015 the U.S. Supreme Court denied a petition for certiorari in Bridgestone Retail Operations, LLC v. Brown (“Bridgestone”), 2015 WL 86028, No. 14-790. The Bridgestone petition challenged the California Supreme Court’s decision in Iskanian v. CLS Transportation Los Angeles (“Iskanian”) (2014) 59 Cal.4th 348, holding that representative claims under the California Labor Code Private Attorneys General Act, Labor Code section 2698, et seq., are not preempted by the Federal Arbitration Act (FAA) and may not be compelled to individual arbitration since they, like qui tam claims, are brought on behalf of the state. Earlier this year, the U.S. Supreme Court declined to consider a petition for certiorari of the Iskanian decision itself.  By declining to accept a second challenge to Iskanian, the High Court has given employee advocates a reason to feel renewed confidence that they may proceed in court with PAGA actions, whether or not their clients are otherwise subject to individual arbitration agreements.

PAGA permits an employee to recover civil penalties for wage violations on behalf of California’s Labor Workforce Development Agency, for redistribution to the State and all aggrieved employees. As Bryan Schwartz Law has discussed in previous blog posts, Iskanian holds that employees cannot waive the right to bring representative actions under PAGA in a court of law by signing mandatory arbitration agreements. AT&T Mobility v. Concepcion (2011) 131 S.Ct. 1740 and its progeny interpret the FAA as permitting employees to give up the right to bring class actions asserting other claims by signing agreements to individually arbitrate those claims. However, in Iskanian, the California Supreme Court reasoned that PAGA is an enforcement mechanism designed to carry out California’s interest in ensuring compliance with state wage laws, and not merely a private litigant’s claim. Therefore, while employers may argue under AT&T Mobility that employees have signed away their rights to bring ordinary class claims alleging wage violations, employees’ representative PAGA claims remain unaffected.

On June 3, 2015 the Ninth Circuit heard oral arguments in three cases presenting questions of whether the FAA requires enforcement of PAGA waivers. See Hopkins v. BCI Coca-Cola Bottling Company of Los Angeles, No. 13-56126; Sakkab v. Luxottica Retail North America, Inc., No. 13-55184; and Sierra v. Oakley Sales Corp., No. 13-55891. Like the U.S. Supreme Court when presented with Iskanian and Bridgestone – the Ninth Circuit should not interfere with California’s right to enforce its own wage laws. Stay tuned. 

Ninth Circuit Again Strongly Disapproves of Reversionary Settlements

Yesterday’s decision by the Ninth Circuit in Allen v. Bedolla is yet another reason that class counsel should not agree to a reversionary settlement. As discussed in previous posts to this blog in 2009 and 2014, as well as other publications in 2010 and 2014, such settlements should generally be rejected out of hand.

In Bedolla, the Ninth Circuit vacated final approval of a settlement agreement with a reversion to the defendant, again signaling its strong disapproval of such clauses. Allen v. Bedolla, WL 3461537 (9th Cir. June 2, 2015).

At issue in Bedolla were wage and hour complaints regarding uncompensated waiting time violations and cash disbursement machines that charged employees a fee to receive their paychecks. The parties settled the case pre-certification for a gross settlement fund of $4.5 million. However, the devil is in the details. All the money not paid towards attorney’s fees, administrations costs, or to class members who submitted claims was reverted to the defendant employer.

In vacating this settlement, the Ninth Circuit only reviewed the settlement’s procedural fairness, i.e., whether the trial court properly explained its decision that the settlement was fair, reasonable, and adequate – not whether the settlement itself was a good deal. Id. Following its decision in In re Bluetooth Headset Products Liability Litigation, the court was troubled by the presence of a reverter to the defendant because reversionary settlements are a “subtle sign[] that class counsel have allowed pursuit of their own self-interests … to infect the negotiations.” Id. (internal citation omitted). Even more troubling was the fact that the attorney’s fees award was three times the “maximum possible amount of class monetary relief.” Id. The appellate court was dismayed that these seemingly self-interested terms were not thoroughly explained by the trial court, and accordingly, remanded the case to seek more thorough justification of the reversionary provision (among other worrisome settlement conditions).

The Ninth Circuit’s decision makes sense. As explained by the Federal Judicial Center’s publication, “Managing Class Action Litigation: A Pocket Guide for Judges”:

A reversion clause creates perverse incentives for a defendant to impose restrictive eligibility conditions and for class counsel and defendants to use the artificially inflated settlement amount as a basis for attorney fees.

If you anticipate a low participation rate, as the attorneys in Bedolla did, then direct any unclaimed funds on a pro rata basis to those class members who previously submitted claims. Bedolla, WL 3461537 at *5 n. 4 (“class counsel said that he would consider it a success if even 10% or 15% of the class made claims”). For example, if a class member in the Bedolla case initially received $25, then that member would receive $2.50 for every additional $1 received by a class member that initially received $10. Pro rata distribution can be done in a second payment, or (more cost-effectively) by increasing the allocations before the initial distribution.

Another option is to designate a cy pres beneficiary that receives any unclaimed funds. This option is particularly advantageous when it is difficult to contact class members or when the recovery for any one class member is likely to be relatively low. One famous example is class members that were overcharged on their taxi fares. Daar v. Yellow Cab. Co., 135 Cal. 2d. 695 (1967). In such cases, the defendant should not be able to benefit from low participation. Instead, a nonprofit that serves the affected community should be awarded any unclaimed funds. For example, in workers’ rights cases, funds should go to the Legal Aid Society-Employment Law Center; Impact Fund; National Employment Law Association Institute; the Foundation for Advocacy, Inclusion & Resources, or a similar organization.

Whatever choice you make, avoid problematic reversionary clauses, or risk your carefully negotiated settlement getting struck down on appeal.

If You Employ Nurses, Know Their Disability Rights

This article, co-authored by Bryan Schwartz Law's principal and Eduard Meleshinsky, is reprinted with the permission of Bloomberg BNA’s Health Law Reporter. The original article is available at here.

Nurses on the front lines of patient care have a significantly greater likelihood of sustaining a workplace injury than average private sector workers. The Bureau of Labor Statistics reports that nurses suffer greater numbers of musculoskeletal injuries than either firefighters or police patrol officers. Press Release, Bureau of Labor Statistics, Department of Labor, USDL-14-2246, Nonfatal Occupational Injuries and Illnesses Requiring Days Away From Work, 2013 (Dec. 16, 2014), available at http://www.bls.gov/news.release/pdf/osh2.pdf. As a result, health care employers need to be particularly mindful of their legal obligations under the Americans with Disabilities Act (ADA) and state disability laws, separate from the requirements of the Family Medical Leave Act (FMLA), state medical leave laws, and workers’ compensation statutes.

I. The ADA Creates Strong Protections for Nurses

The Americans with Disabilities Act (ADA) ensures that people with disabilities can “fully participate in all aspects of society.” 42 U.S.C. § 12101(a). Title I of the ADA, the section addressing employment, provides that a covered employer many not “discriminate against a qualified individual on the basis of disability in regard to job application procedures, the hiring, advancement, or discharge of employees, employee compensation, job training, and other terms, conditions, and privileges of employment.” 42 U.S.C. § 12112(a). Under the act, discrimination includes failing to make reasonable accommodations to an otherwise qualified job applicant or current employee unless such accommodations would constitute an undue hardship on the covered employer. 42 U.S.C. § 12112(b)(5)(A). Determining whether a reasonable accommodation creates an undue hardship is a fact-intensive inquiry, and must include consideration of “the overall financial resources of the facility making the reasonable accommodation; the number of persons employed at this facility” and “the overall financial resources, size, number of employees, and type and location of facilities of the employer (if the facility involved in the reasonable accommodation is part of a larger entity),” among other factors. Equal Employment Opportunity Commission, Notice No. 915.002, EEOC Enforcement Guidance on Reasonable Accommodation and Undue Hardship Under the Americans with Disabilities Act (2002) (EEOC Notice), available at http://www.eeoc.gov/policy/docs/accommodation.html. See also 42 U.S.C. § 12111(10)(B); 29 C.F.R. § 1630.2(p)(2). Accordingly, proving a reasonable accommodation constitutes an undue hardship is a difficult task for all but the smallest health care employers. See, e.g., Borkowski v. Valley Cent. Sch. Dist., 63 F.3d 131, 142 (2d Cir. 1995) (denying summary judgment because “nothing inherently unreasonable or undue in the burden that an employer would assume by providing an assistant to an employee with disabilities”); Garcia-Ayala v. Lederle Parenterals, Inc., 212 F.3d 638, 649 (1st Cir. 2000) (denying summary judgment on the basis that unpaid leave for more than one year was not an undue burden as a matter of law); Garza v. Abbott Labs., 940 F. Supp. 1227, 1241-43 (N.D. Ill. 1996) (summary judgment denied because $9,500 voice recognition system was not an undue burden as a matter of law); Equal Employment Opportunity Commission, Questions and Answers about Health Care Workers and the Americans with Disabilities Act, at Example 22 (2002) (EEOC Q&A) (presenting hypothetical where purchasing a $1,500 mechanical patient lifting device is not an undue hardship for a large hospital seeking to accommodate a nursing assistant with a back injury), available at http://www.eeoc.gov/facts/health_care_workers.html.

Furthermore, an employer cannot rely on generalized stereotypes of disabilities in deciding whether to grant a request for a reasonable accommodation. Instead, an employer must enter into a good-faith interactive process with an eligible employee to determine whether any reasonable accommodations are possible based on an individualized assessment of the employee’s restrictions and the essential duties of the job. 49 C.F.R. § 1630.2(o)(3).

II. Consider the Full Range of Accommodations Nurses May Require 

While injury prevention should be every employer’s goal, nurses likely will continue to account disproportionately for on-the-job back injuries. Accordingly, hospitals should design their leave and accommodation policies to consider the unique facts at issue when nursing staff is injured. When a nurse suffers a back or other type of injury, she or he often remains capable of performing the vast majority of her job duties. If the back injury substantially limits her in one or more major life activities (personal care, driving for long periods, lifting, bending, sitting, working, etc.), she or he will have an ADA-covered disability. See, e.g., EEOC v. AutoZone, Inc., 630 F.3d 635, 637 (7th Cir. 2010) (employee sustained an injury to his back that limited his ability to carry out many activities requiring physical exertion, such that a reasonable jury could find him substantially limited in the major life activity of personal care); Norris v. Allied-Sysco Food Servs., Inc., 948 F. Supp. 1418 (N.D. Cal. 1996), aff’d, 191 F.3d 1043 (9th Cir. 1999), cert. denied 528 U.S. 1182 (2000) (employee with a back injury had an ADA covered disability because of acute pain and substantial limitations on driving, lifting, and working in a broad class of jobs). It is incumbent on the employer to perform an individualized assessment of the injured nurse and determine whether the nurse can perform her or his essential job duties with or without reasonable accommodations. Many health care employers make the mistake of thinking too narrowly about what constitutes a reasonable accommodation. Under the ADA, the following is a nonexhaustive list of reasonable accommodations:

• Job restructuring,  
• Modified or part-time schedule,
• Leave, and, if no other reasonable accommodation exists, 
• Reassignment 

See EEOC Notice; See also 42 U.S.C. § 12111(10)(B); 29 C.F.R. § 1630.2(p)(2).

1. Job restructuring 

An employer can choose to modify injured nurses’ job duties such that they are not required to perform certain physically demanding tasks permanently, or temporarily while recuperating. Healthy nurses can be assigned more strenuous activities while injured nurses remain capable of serving many less physically demanding functions in a hospital or medical facility, such as calling patients before a procedure and medical coding. Job restructuring is often a sound business decision given the costs of training new nurses. Hospital Patient and Health Care Worker Injury Protection Act, Ch. 554, § 2(d), 2011 Cal. Legis. Serv. (codified at Cal. Lab. Code § 6403.5) (California Legislature found that the cost “to train and orient each new nurse” was “between sixty thousand dollars ($60,000) and one hundred forty thousand dollars ($140,000)”).

2. Modified or Part-time Schedule 

At times, an injured nurse may be released back to work by a doctor, but only with a reduced or modified schedule. Honoring such a schedule is critical for injured nurses who can return to work, but who, for example, still require time-intensive physical therapy to regain physical functioning. Health care employers must consider allowing a modified or part-time schedule unless doing so would impose an undue hardship on operations. See, e.g., Ward v. Mass. Health Research Inst., Inc., 209 F.3d 29, 36 (1st Cir. 2000) (rejecting employer’s “general statements regarding the snowball effect” of allowing disabled employee part-time schedule because “[t]he ADA explicitly states that ‘job restructuring’ and ‘part-time or modified work schedules’ are potential reasonable accommodations”) (citing to 42 U.S.C. § 12111(9)(B)).

3. Leave 

Often, a back injury can last more than the 12 weeks of medical leave guaranteed by the FMLA. However, inflexible leave policies that apply a one-size-fits-all approach to injured nurses violate the ADA. Additional leave should always be considered as a reasonable accommodation regardless of the injured worker’s FMLA eligibility, sick time, vacation time, or other benefits. Humphrey v. Mem’l Hospitals Ass’n, 239 F.3d 1128, 1137-39 (9th Cir. 2001) (employer violated ADA by failing to consider leave of absence in carrying out its “mandatory obligation under the ADA to engage in an interactive process with the employee to identify and implement appropriate reasonable accommodations”); Press Release, Equal Employment Opportunity Commission, Princeton Healthcare Pays $1.35 Million to Settle Disability Discrimination Suit with EEOC (June 6, 2014) (EEOC Release), available at http:// www.eeoc.gov/eeoc/newsroom/release/6-30-14.cfm (employer’s leave policy that “merely tracked the requirements of the federal Family Medical Leave Act” violated the ADA); Shannon v. City of Philadelphia, No. CIV.A. 98-5277, 1999 WL 1065210, at *5 (E.D. Pa., Nov. 23, 1999) (reasonable accommodation may require an employer “to grant liberal time off or leave without pay when paid sick leave is exhausted and when the disability is of a nature that it is likely to respond to treatment [or] hospitalization”) (citing Department of Labor regulations for disability accommodation law covering federally funded programs). The EEOC is targeting inflexible leave policies as one of its regulatory priorities, and has successfully obtained seven-figure outcomes and injunctive relief against health care employers for their inflexible leave policies. See EEOC Release. Health care employers should revisit any leave policies providing for automatic termination following a fixed period of leave.

4. Reassignment 

Reassignment to a vacant position is an often misunderstood form of reasonable accommodation, though it is required under the ADA. 42 U.S.C. § 12111(9)(A). Reassignment should be used as an accommodation of last resort after the employer and employee agree that no reasonable accommodation is possible in the employee’s current position either long-term or permanently. If a nurse’s injury is so severe as to render her or him unable to safely handle patients or otherwise limits performing essential job functions, and no other reasonable accommodations exist, the health care employer must consider reassignment. If any vacant position is available for which the injured nurse is qualified, then the employer must reassign the nurse without a competitive application process. Smith v. Midland Brake, Inc., 180 F.3d 1154, 1164 (10th Cir. 1999) (“ ‘reassignment’ must mean something more than the mere opportunity to apply for a job with the rest of the world.... ‘reassign’ must mean more than allowing an employee to apply for a job on the same basis as anyone else. An employee who on his own initiative applies for and obtains a job elsewhere in the enterprise would not be described as having been ‘reassigned. . . .’ ”). However, the ADA does not require preferential reassignment if the vacant position would constitute a promotion. See EEOC Notice, at Question 24. Reassignment must be considered not just in the single facility in which the injured nurse previously worked, but at all of the employer’s locations. EEOC Notice, at Question 27 (employer’s obligation to reassign is not “limited to those vacancies within an employee’s office, branch, agency, department, facility, personnel system (if the employer has more than a single personnel system), or geographical area”). Disabled nurses still have a wide range of skills that can be deployed in a variety of positions such as medical coding, auditing, patient interviewing (including pre-visit calls), training other health care workers, quality assurance, supply management, infection control, and many more. In addition to the medical skills mentioned above, hospitals have many stationary (e.g., administrative) positions that an injured nurse could perform effectively. Frequently, employers do not consider all of these potential positions that a disabled nurse can successfully occupy. One overlooked position is case manager, with duties such as providing day-to-day case management to patients by “documenting the costs of care, preparing reports regarding a plan of care, and identifying and implementing medical services to meet the needs of” patients. Rieve v. Coventry Health Care, Inc., 870 F. Supp. 2d 856, 864 (C.D. Cal. 2012). A case manager position utilizes nurses’ wealth of medical knowledge and patient interaction skills without significant physical exertion. A good-faith effort by health care employers likely would uncover similar positions within their organizations should reassignment be necessary. In general, “Employers, who fail to engage in the interactive process in good faith, face liability for the remedies imposed by the [ADA] if a reasonable accommodation would have been possible.” Humphrey, 239 F. 3d at 1137-38 (internal citations and quotation marks omitted).

III. Workers’ Compensation Compliance Does Not Equate to ADA Compliance. 

Because nurses are frequently injured on the job, they often file a claim for workers’ compensation benefits in conjunction with taking a medical leave. A common mistake committed by health care employers is substituting compliance with a workers’ compensation statute for compliance with the ADA. This mistaken belief can lead to costly liability. The authors of this article represented a registered nurse in a disability accommodation action against her health care employer for failure to timely accommodate her disability. She injured her back at work and went on leave. When she returned, she was reassigned because her physical restrictions prevented her from serving in her previous position. After three months, however, she was notified that she would be put on indefinite, unpaid leave until her restrictions were determined to be “permanent” by the workers’ compensation medical examiner—a process that can take years. Indeed, she was forced out on unpaid leave for 19 months without any attempt by the employer to explore reasonable accommodations such as reassignment to a different position. Conflating ADA obligations with workers’ compensation obligations, or those under leave laws or other statutory schemes, can lead to liability. In the case just discussed, the nurse was forced out of her job without any consideration of a reasonable accommodation (of which there were many possible) because of a mistaken belief that no accommodation was necessary until the workers’ compensation process had been completed.

IV. Conclusion. 

A prudent health care employer will ensure that its ADA policy is reviewed for compliance with the ADA’s demanding requirements. If you employ nurses, you should be helping disabled nurses to keep utilizing their valuable talents and experience in your service, and in service of your patients.

Supreme Court Rules Employers Cannot Refuse to Hire Job Applicants Because of Headscarves Worn in Observance of Their Religion

In Equal Employment Opportunity Commission v. Abercrombie & Fitch Stores, Inc. the Supreme Court ruled 8-1 that Abercrombie acted in violation of Title VII when it refused to hire Samantha Elauf, a practicing Muslim, because she wore a headscarf for religious reasons.

Ms. Elauf had applied for a position with an Abercrombie store in the fall of 2007. During her interview she scored well enough to be hired, but the store’s assistant manager charged with interviewing Ms. Elauf was concerned about the headscarf Ms. Elauf wore. Under Abercrombie’s “Look Policy” for employees “caps” are prohibited. The assistant manager asked the district manager whether she could hire an applicant even if the applicant wore a headscarf. The district manager responded that the Look Policy barred all head coverings, including headscarves worn for religious reason, and directed the assistant manager to reject Ms. Elauf’s application.

The EEOC sued Abercrombie on Ms. Elauf’s behalf, arguing that Abercrombie’s refusal to hire her was a violation of Title VII. The relevant portion of Title VII states that it is a violation of the act “to fail or refuse to hire … any individual, or otherwise to discriminate against any individual… because of such individual’s … religion.”

The EEOC won a summary judgment in District Court. But, Abercrombie successfully argued to the Tenth Circuit that because Ms. Elauf had not requested an accommodation their decision not to hire her was not a violation of Title VII. The Supreme Court, however, disagreed.

Justice Scalia, writing for the majority, said that a job applicant “need only show that his need for an accommodation was a motivating factor in the employer’s decision” to prove discrimination in violation of Title VII. Justice Scalia added that while evidence a job applicant had requested an accommodation made motive easier to prove, it was not a prerequisite to demonstrating liability. Ultimately, the court determined that an employer cannot use “actual knowledge, a well-founded suspicion or merely a hunch” about an applicant’s religion in making employment decisions. Justice Thomas was the lone dissenter.

Bryan Schwartz Law has previously represented Sarabjit Kaur, a Sikh woman, who like Ms. Elauf faced employment discrimination because of her religious head covering. We see the Supreme Court’s decision in Abercrombie as key to ensuring that people of all religions can pursue employment free from discrimination, and hope employers will take note of this decision.

If you have concerns that your employer is discriminating against you because of your religion, or that you were not hired because you require a religious accommodation, please contact Bryan Schwartz Law. 

Workers Prevail in Fight Against Binding Arbitration

On April 29, 2015, the United States District Court for the Central District of California, Hon. Phillip S. Gutierrez, issued an important decision denying defendants' motion to compel arbitration on an individual basis in Maria Ford, et al. v. Gary Yasuda, et al. finding an arbitration agreement unenforceable on grounds of waiver. The opinion provides a well-reasoned decision on conduct inconsistent with arbitration rights and resulting prejudice suffered by the non-moving party. In its decision, the court held that defendants had actively litigated the case in federal court and warned against defendants attempting to compel arbitration for fear of future unfavorable rulings.

The Ford plaintiffs allege that while enrolled at Milan Institute of Cosmetology they were “employees” when they performed services on their paying customers, sold products and services for the for-profit business and engaged in janitorial work including stocking supplies and laundering towels on behalf of defendants Milan Institute of Cosmetology and Gary Yasuda. Because they were not paid wages or provided any employee benefits to which they were due, the Ford plaintiffs brought suit in October 2013 on behalf of themselves and others who enrolled at Milan. 

The court denied defendants’ motion which sought to compel individual arbitration and relief, in the alternative, to extend the scheduling order to allow more time for discovery it had not initiated pending the motion to compel, in its entirety. The court found that defendants abandoned their rights to arbitration by unreasonably delaying filing a motion to compel arbitration seventeen months into the litigation. The court also found that defendants' delay was unjustified where it could not rest on claims on any “precedential, procedural, or other barriers to arbitration.” The opinion exposed defendants' “protracted silence regarding arbitration” as a conscious effort to seek judicial judgment on a threshold legal question then shop for a more receptive forum after an adverse ruling on the issue.

                The court found prejudice in the time defendants took after the filing of the complaint and after it raised arbitration as an affirmative defense before moving to compel. The court also found prejudice to the Ford plaintiffs due to a previous order by the court on defendants’ motion to dismiss which “resolved a crucial issue in [plaintiffs] favor.” Discussed in a previous Bryan Schwartz Law blog post, the court determined that “[b]ased on Martinez, the Court concludes that the California Supreme Court would hold that [Defendants’] students may be properly classified as its employees, if they are within the definition of ‘employment’ established by the IWC.” The court’s analysis highlights that where motions practice requires the litigation of claims on the merits “touch[ing] on the basic issues in the case,” a motion to compel following the motions practice will not be received favorably. As is the case here, plaintiffs would be substantially prejudiced by a need to relitigate matters decided by the district judge. 

The decision not only permits the Ford plaintiffs to proceed in the vindication of their statutory employment rights on behalf of themselves and others similarly situated in federal court, but also enumerates conduct of parties moving to compel arbitration that run afoul of a good faith exercise of arbitration rights. Read the full opinion here.

Young v. United Parcel Service, Inc. Strengthens Pregnant Workers’ Right to Accommodation

In Young v.UPS, a 6 to 3 Supreme Court majority vacated a Fourth Circuit decision upholding a District Court decision granting UPS summary judgment and supported a driver’s pregnancy discrimination claims. The Court resolved a Circuit split regarding employers’ duty to accommodate pregnancy-related limitations. Justice Breyer, writing for the Court, explained that Young demonstrated a genuine issue of material fact as to whether UPS’s facially neutral reasons for not accommodating her were a pretext for pregnancy discrimination. Only Justices Thomas, Scalia, and Kennedy dissented.

I.                   Young’s Story

Young worked as a part-time delivery driver for UPS. She became pregnant in fall 2006, and her doctor told her that she should not lift more than 20 pounds during the first 20 weeks of her pregnancy, or more than 10 pounds thereafter. With this lifting restriction, UPS told her that she could not work during her pregnancy because UPS required drivers to be able to lift parcels weighing up to 70 pounds (and up to 150 pounds with assistance). UPS also told her that she was not qualified for a temporary alternative work assignment even though UPS promised to provide temporary alternative work assignments to employees who were injured at work based on a collective bargaining agreement. Young, as a result, stayed home and remained on a leave of absence without pay during most of her pregnancy, and eventually lost her employee medical coverage.

Young sued UPS, claiming that UPS discriminated against her by failing to accommodate her during her pregnancy. UPS filed a motion for summary judgement, arguing that there is no duty to accommodate pregnancy, and that Young did not fit into any of the three categories of drivers UPS would accommodate under its company policy: (1) those who injured at work; (2) those who lost their Department of Transportation (DOT) certifications, and (3) those who suffered from a disability covered by the Americans with Disabilities Act of 1990 (ADA). In reply, Young proffered the following facts she believed she could prove to support her claims. First, her co-workers were willing to help her with heavy packages, but UPS denied this as an accommodation. Second, UPS accommodated other drivers who suffered disabilities that created work restrictions similar to hers. Third, a UPS shop steward who had worked for UPS for roughly a decade testified in his deposition that “the only light duty requested restrictions that became an issue” at UPS “were with women who were pregnant.”

II.                Holdings of the District Court and the Fourth Circuit

The District Court granted UPS’ motion for summary judgment. It reached two conclusions. First, Young could not show intentional discrimination through direct evidence merely based on the fact that UPS denied her accommodation requests and approved of accommodating others. Second, Young could not make out a prima facie case of pregnancy discrimination under McDonnell Douglas because those drivers who were accommodated by UPS (on-the job injuries, DOT or ADA categories) and Young were too different to be deemed similarly situated. In short, the District Court treated UPS’ reliance on its three-category facially neutral policy as a legitimate, nondiscriminatory reason for refusing to accommodate Young. The District Court found that Young created no genuine issue of material fact as to whether UPS’s reason was pretextual. The Fourth Circuit affirmed the District Court’s findings.

III.             The U.S. Supreme Court        

A. Disputes over Interpretations of the Second Clause of the Pregnancy Discrimination Act (PDA) under Title VII

Young filed a petition for certiorari asking the U.S. Supreme Court to review the Fourth Circuit’s interpretation of the PDA under Title VII, and the Supreme Court granted her petition. The focus of the dispute was the PDA’s second clause: “Women affected by pregnancy, childbirth, or related medical conditions shall be treated the same for all employment-related purposes . . . as other persons not so affected but similar in their ability or inability to work.” Young contended that a court, under the second clause of the PDA, should find a Title VII violation whenever a pregnant worker is not accommodated as other workers who have similar inability to work. UPS, in contrast, maintained that the second clause merely incorporated pregnancy discrimination into the ban on sex discrimination, and held that courts should compare accommodations a pregnant worker receives with those received by other workers within a facially neutral policy.

Justice Breyer, in the majority opinion, while denying pregnant women have an unconditional “most-favored-nation” status under the PDA and while refusing to give special weight to the EEOC’s 2014 guidelines supporting Young’s interpretation, held that UPS’s interpretation failed to carry out Congress’ objectives in the PDA. First, UPS’s interpretation would render the second clause of the PDA superfluous because the first clause of the PDA already defined pregnancy discrimination as a kind of sex discrimination. Second, accepting UPS’s interpretation (followed by the dissent) would revive the Court’s decision under General Electric Co. v. Gilbert, 429 U.S. 125 (1976) -- one that the Congress passed the PDA to overturn. The employer’s plan in Gilbert was similar to the UPS’s facially neutral accommodation policy. The Gilbert employer plan “provided non-occupational sickness and accident benefits to all employees without providing disability benefit payments for any absence due to pregnancy,” and thus did not violate Title VII, because pregnancy was neither a disease nor necessarily a result of accident. Justice Breyer, invoking California Fed. Sav. & Loan Assn. v. Guerra, 479 U.S. 272 (1979), emphasized that the first clause of the PDA reflected the Congress’ disapproval of the reasoning in Gilbert by expressly adding pregnancy to the definition of Title VII’s sex discrimination, while the second clause was intended to overrule the holding of Gilbert and to illustrate how pregnancy discrimination could be remedied.

      B. Applying the McDonnell Douglas Framework Under the Second Clause of the PDA to Young’s Case

Justice Breyer clarified the McDonnell Douglas framework under which pregnant workers, when being denied an accommodation under the PDA’s second clause, could show disparate treatment through indirect evidence. To make out a prima facie case, the pregnant worker must show: (1) that she belongs to the protected class (pregnancy); (2) that she sought accommodation; (3) that the employer did not accommodate her, and (4) that the employer did accommodate others “similar in their ability or inability to work.” Then, the burden of proof shifts to the employer and the employer could justify its refusal to accommodate her by showing “legitimate, non-discriminatory” reasons. To rebut the employer’s justifications, the pregnant worker may in turn show that the employer’s proffered reasons are in fact pretextual through two steps. First, the pregnant worker can provide sufficient evidence showing that the employer’s policies impose a significant burden on pregnant workers. Second, the pregnant worker can further demonstrate that the employer’s “legitimate, nondiscriminatory” reasons are not sufficiently strong to justify the burden. After the pregnant worker meets the above evidentiary standards, an inference of intentional discrimination may arise. For example, when the pregnant worker provides evidence demonstrating that the employer accommodated a large percentage of non-pregnant workers while failing to accommodate a large percentage of pregnant workers, this creates a genuine issue of material fact as to whether a significant burden is imposed upon pregnant workers.

Applying the clarified framework and viewing the record in the light most favorable to Young, Justice Breyer held that Young created a genuine dispute as to whether UPS provided more favorable treatment to at least some employees whose situation cannot reasonably be distinguished from hers. Also, the Fourth Circuit failed to consider whether UPS’s three-category policy significantly burdened pregnant women and whether UPS’s justifications were strong enough to justify such a burden. The lower courts, on remand, will need to determine whether Young created a genuine issue of material fact regarding whether UPS’s reasons were pretextual. 

Justice Alito concurred with the majority and held that UPS’ justifications for differentiating drivers in the three categories of accommodated workers were not clear enough to justify their decision to treat pregnant drivers less favorably.

If you believe that your employer imposed an unjustifiable burden upon you during your pregnancy, please contact BryanSchwartz Law. 

Ninth Circuit: Employee’s Statements Suffice to Overcome Employer’s Summary Judgment Motion

In the context of employment discrimination litigation, one of the most challenging tasks for both the aggrieved employee and his or her attorneys is to find evidence beyond the employee’s own statements. For example, when you informed your supervisor of your disabled status over the phone, and your supervisor verbally declined your accommodation requests, how can you prove this conversation happened? Your supervisor may deny the conversation took place.

The Ninth Circuit Court of Appeals recently announced good news for workers who must rely upon their own testimony to survive an employer’s motion for summary judgment. In Nigro v. Sears, Roebuck and Co., 778 F.3d 1096 (9th Cir. 2015), the Ninth Circuit reversed the district court’s summary judgement in favor of Sears on the plaintiff’s claims under California’s Fair Employment and Housing Act (FEHA). The Court held that the District Court erred in disregarding the plaintiff’s declaration and deposition testimony because it was “self-serving.” As the Ninth Circuit explained, “declarations are often self-serving, and this is properly so because the party submitting it would use the declaration to support his or her position.” Id. at 1098. Ultimately, the fact “that evidence is to a degree self-serving is not a basis for the district court to disregard the evidence at the summary judgment stage.” Id. In Nigro, the plaintiff’s testimony – plus a statement of a witness that the supervisor had admitted “I’m done with that guy” about the plaintiff – were sufficient to overcome summary judgment on Nigro’s disability-based wrongful termination claim.

The Ninth Circuit reiterated in Nigro the important holding that it should not take much for employees in a discrimination case to overcome a summary judgment motion.

The Ninth Circuit also reversed summary judgment on Nigro’s FEHA claims based upon denied disability accommodation and failure to engage in the interactive process. The District Court concluded that there were no genuine issues of material fact because Nigro “continued to be accommodated…despite ‘any actual or perceived irritation’” by the boss. Id. at 1099. But the Ninth Circuit found, based upon the plaintiff’s testimony, that the supervisor’s boss “chilled” Nigro’s right to use an accommodation and stifled the interactive dialogue, and as such, that summary judgment should have been denied on both counts. Id. Nigro’s testimony that he spoke to the supervisor’s boss about accommodations in a single phone conversation was enough to obligate Sears to participate in the interactive process.

If you have concerns over the way your employer is responding to reasonable accommodation requests, please contact BryanSchwartz Law.