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Labor Update - Third Quarter 2010                                         Recent Developments in Labor and Employment Law


 

Since 1984, Peters & Lyons, Ltd. has written and published a quarterly newsletter, The Labor Update,

as a service to our clients and other friends.  Please find our current Newsletter edition below.

Feel free to search our newsletters in addition to browsing through past editions.                       

 

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Beware of the Cat’s Paw!

 

        The “cat’s paw” doctrine can result in company liability for employment discrimination even where the manager making the challenged employment decision is innocent of any bias!

     This rather new theory of liability takes its name from the 17th century French fable, The Monkey and the Cat. In the fable, a conniving monkey convinces a naïve cat to pull out some chestnuts roasting on a fire. The cat’s paw is burned and the monkey eats the chestnuts. From this fable, “cat’s paw” has come to mean a biased supervisor or manager’s use of another manager to bring about the discharge or discipline of an employee.

     In April 2010, the United States Supreme Court agreed to hear the appeal of a case involving the cat’s paw doctrine, to determine and shape its use and limitations. The case under review arose in Peoria, Illinois. Vincent Staub was employed as a technologist at Proctor Hospital. After Staub returned from military service, some of his immediate supervisors verbally and repeatedly expressed resentment toward him and made negative remarks about his continuing reservist duties. These same supervisors reported to human resource manager Linda Buck that Staub shirked his hospital duties, refused to help out, and was abrupt to others. Based on this information, Buck discharged Staub, who sued the hospital in federal court under the anti-discrimination provisions of the Uniformed Services Employment and Reemployment Rights Act (USERRA).

     The federal district court allowed Staub’s case to proceed, despite the protests of the hospital that decision maker Linda Buck was not shown to be biased in her decision. After the trial judge instructed the jury as to the “cat’s paw” doctrine, the jury found in favor of Staub, awarding him $57,640 in damages. However, the United States Court of Appeals in Chicago reversed, finding that under these circumstances the jury should not have been so instructed. The appeals court found that there had been no evidence brought forth at trial that Linda Buck was “singularly influenced” by Staub’s allegedly biased line supervisors. The court said that because Buck had looked into the matter to some degree, her unbiased decision should not have been subject to attack merely because some non-decision making supervisors were biased against Staub. Since other federal courts of appeals have not been so restrictive in the application of the cat’s paw theory of liability, the Supreme Court agreed to hear and decide the matter. Not surprisingly, the Obama administration has filed an amicus brief with the Court, in support of the affirmative recognition of the cat’s paw theory, with as broad a reach as possible.

     The employment law community will be anxiously awaiting the Supreme Court’s opinion. The Court is expected to specify the degree of biased influence that a plaintiff must show over an ultimate decision maker, before a company’s decision may be attacked as tainted.

     However the “cat’s paw” doctrine may be shaped by the Supreme Court, it is clear that employers can largely inoculate themselves against liability by adjusting their investigatory and disciplinary procedures to guard against claims of biased manipulation. Employers can do so by insisting, to the degree practical, that the decision maker conduct an independent investigation of the facts, and not simply rely on the assertions of front line supervisors. This may seem like an inefficient derailing of the usual chain of reporting and information, but nevertheless some degree of a documented independent investigation by the decision maker is prudent. In addition, employers are wise to consistently allow an employee who may be subject to discipline, an opportunity to explain his side of the story. At that juncture, the employee could presumably assert that he is a victim of biased reporting, which the decision maker would then have the opportunity to further investigate before any disciplinary action is taken. Staub v. Proctor, 560 F.3d 647 (7th Cir. 2009), cert. granted, 130 S.Ct. 2089 (2010).
 

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GET THE MESSAGE--HARASSMENT VIA TEXT A GROWING PROBLEM

    

       Text messaging can create liability for employers in more ways than by contributing to job related accidents. Although the dangers of “texting and driving”are more highly publicized and have long been a source of concern when employees use mobile devices in their employment, the growth of communication via text has spawned a whole new type of harassment liability. In fact, the sending of offensive messages and imagery through cell phones and the like has become so common that it has been dubbed “textual harassment.”

     The problem is no laughing matter. Old-fashioned rules of “professional” correspondence seem to apply with even less vigor to text messages than they do to “regular” e-mails. Text messages are often short, jokey and abbreviated, and therefore potentially more susceptible to being misconstrued. Furthermore, because text messages are often sent and received on employee owned devices and through “personal,” non-business phone numbers and accounts, rules governing the use of employer systems and equipment are often incorrectly assumed not to apply. Employees who would never dream of sending a racy e-mail from a company computer to a business e-mail account, may not even pause before sending a coworker a friendly “personal” text message to or from a private device.

     However, as legions of legal case books and Labor Updates will attest, what is all too often meant as harmless, flirtatious and/or funny by one employee can be perceived by another as unwelcome and offensive. Furthermore, the law does not distinguish between harassment perpetrated on the clock or off. Moreover, text messages create a clear and lasting record of alleged harassment, and can be compelling evidence at a trial.

     Accordingly, it is vitally important that employers update both their anti-harassment and computer/internet usage policies to address the growing problem of harassment via text. This problem is especially troublesome in Illinois, where employers are held strictly liable for a hostile environment of harassment created by company supervisors under state law. Under this theory of strict liability, Illinois employers must arguably do even more than adopt and implement effective policies to ward off potential liability for their supervisors’ texts. Because Illinois employers can be liable for their supervisors’ harassment even without prior knowledge or awareness of their misconduct, they must arguably look for ways to proactively prevent such harassment in the first place. Peters & Lyons, Ltd. can help update employee handbooks to address this troublesome trend, and help companies take affirmative action to prevent potential claims.
 

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NO CASE IN CHIEF: ALLEGED MARK OF ANIMOSITY
NO SYMBOL OF RETALIATION

    

     Robert Leonard, a Native American, worked in a janitorial and mechanical support position for Eastern Illinois University for nearly 20 years.  During that period, he sought but was passed over for several promotions.

 

     Leonard was an outspoken advocate on Native American issues.  He was particularly critical of Chief Illiniwek, the former symbol of the athletic programs at the University of Illinois at Urbana-Champaign.  His vocal opposition to the Chief included involvement in a lawsuit that received national media coverage.  

 

     In March 2005, Leonard interviewed before a panel of six supervisors in pursuit of yet another promotion. At the start of the interview, two of the supervisors removed their jackets and revealed shirts emblazoned with the Chief Illiniwek logo.  Leonard was offended by the shirts, which he believed represented a personal message to him.  However, March 2005 also coincided with the University of Illinois’ men’s basketball team’s run to the NCAA championship game, and the “Fighting Illini” just so happened to be competing in the tournament’s “Sweet Sixteen” on the day of Leonard’s interview.

 

     Neither Leonard nor any other applicant was promoted as a result of the March 2005 interviews. The next month, Leonard lodged a formal complaint about the shirts with EIU’s Office of Civil Rights. In response to the complaint, Leonard’s supervisors were requested to refrain from wearing Chief Illiniwek imagery when dealing with Leonard.  Leonard advised that he was satisfied with this outcome.

 

      In October 2005, Leonard interviewed for promotion again, along with seven other applicants. His interview was held before the same panel of six supervisors, none of whom wore or said anything that Leonard found offensive.  In fact, Leonard believed the interview went well.   

 

     Once again, however, Leonard did not get promoted.  According to a numerical scoring system used by the panel, Leonard ranked seventh out of the eight candidates.  Only the top three candidates received a promotion.

 

     Leonard sued EIU under Title VII, alleging that the panel’s decision not to promote him was retaliation for his April 2005 civil rights complaint about the Illiniwek shirts.  The trial court granted EIU summary judgment and dismissed Leonard’s claim.  Leonard appealed that dismissal to the U.S. Court of Appeals for the Seventh Circuit, which affirmed the judgment in favor of EIU.

 

     The court noted that Leonard presented no evidence to establish a causal connection between his complaint and EIU’s failure to promote him.  Indeed, Leonard was unable to demonstrate that any members of the interview panel—or anyone else at EIU—were angered by his complaint or biased against him because of it.  During his interview, Leonard was asked the same standardized questions put to each of the interviewees, and all six members of the interview panel ranked Leonard in the bottom half of candidates.  Furthermore, the six month gap between Leonard’s complaint and most recent denial of promotion was too great to infer causation from mere timing alone.  Leonard v. Eastern Illinois University, 109 Fair Empl. Prac. Cas. (BNA) 545 (7th Cir. 2010).

 

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LACK OF RECORDKEEPING CAN DOOM
DEFENSE OF WAGE CLAIMS

            Under state or federal wage and hour laws, when an employee has been improperly paid, the remedy is to make the employee whole, and in some cases a double damages penalty is applied.  The length of the make whole period is typically two years, but can be extended to three years if a willful violation can be shown. 

            These claims can arise where an employee should have received overtime pay, but didn’t, because the employer improperly considered him as exempt; where the employer used an improper method to calculate overtime pay; where an employee works “off the clock” and receives no pay for that time; or in claims of gender based unequal pay.

             When a violation is found, government investigators first turn to the employer to examine time and pay records in order to calculate the make whole amount.  However, where a company never kept such records or they no longer exist, the question becomes how to figure the damages?  For many years, claims under the federal Fair Labor Standards Act have allowed the Department of Labor or a court to apply a “reasonable inference” standard.  Further, in such cases, the subject employee’s own estimate of the hours he or she worked during the period in question are viewed as presumptively correct, with the employer then playing defense in trying to rebut that presumption.

             In a recent case, the Illinois Appellate Court has now extended the federal “reasonable inference” standard to claims brought under Illinois wage laws.  Mary Arrington complained successfully to the Illinois Department of Labor that Main Street Liquors had violated the Illinois Equal Pay Act, by not paying her at least as much as it paid a male with similar skills, effort and responsibility.  Here, because Main Street Liquors paid employees partially by check and partially in cash, the company had no records documenting the total compensation paid to Ms. Arrington and the comparative male employee.  The Illinois Department of Labor considered the total amount of the paychecks and somehow “inferred” that the same amount must have been received in cash.  The appeals court approved the application of “reasonable inference” standard.  The court noted that since the company did not bring forth evidence to dispute the inference, it was presumptively reasonable.  Thus, Illinois employers with poor recordkeeping now face the threat of estimated liability in both state and federal wage claims.  People v. 2000 W. Madison Liquor Corp., 394 Ill. App. 3d 813, 917 N.E. 2d 551, 334 Ill. Dec. 725 (1st Dist. 2009).

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Quotable

 The most advantageous negotiations are those one conducts with human vanity, for one often obtains very substantial things from it while giving very little of substance in return.  One never does so well as when dealing with ambition or avarice.

Tocqueville

 

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Since 1984, the LABOR UPDATE has been provided as a service to clients, fellow attorneys and other friends of our firm.  Written entirely by Peters & Lyons attorneys, it is intended to provide useful information as to the matters covered, but should not be viewed as an exhaustive treatment of the subjects addressed or as covering all significant developments in labor and employment law.  The LABOR UPDATE is not intended to be a substitute for legal advice. 

The LABOR UPDATE may be quoted or reproduced if credit is given to Peters & Lyons, Ltd. as the source.

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