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FMG Law Blog Line

Posts Tagged ‘discrimination’

FMG Client Headed to Supreme Court in Landmark Title VII Case to Resolve LGBT Employment Standards

Posted on: April 23rd, 2019

The Supreme Court yesterday agreed to review two federal circuit court decisions that reached differing conclusions as to whether Title VII of the Civil Rights Act of 1964 covers sexual orientation. For approximately 40 years, the EEOC and the federal circuit courts have unanimously held that Title VII does not encompass sexual orientation. The EEOC changed its position in 2014 and determined that Title VII encompasses sexual orientation. The Seventh Circuit likewise reversed its position in 2017, and the Second Circuit changed its position in early 2018 and held in Zarda v. Altitude Express that Title VII encompasses sexual orientation. Later in 2018, the Eleventh Circuit re-affirmed circuit precedent and held in Bostock v. Clayton County that Title VII does not prohibit discrimination on the basis of sexual orientation. The Supreme Court agreed to review Bostock and Zarda and consolidated the two cases.

Freeman Mathis and Gary, LLP represents Clayton County in Bostock and will argue that Title VII does not apply to a claim of discrimination on the basis of sexual orientation.

In addition, the Supreme Court granted certiorari in the Sixth Circuit case of R.G. & G.R. Harris Funeral Homes v. EEOC. That case raises the question of whether Title VII provides protection to transgender persons. That case is similar in some regard to the Bostock and Zarda cases, however, their distinctions are evident in that the Court did not consolidate the Harris case with Bostock and Zarda.

In granting certiorari in the Harris case, the Supreme Court may revisit a concept outlined in its 1989 decision in Price Waterhouse v. Hopkins, which held that it was unlawful sex discrimination under Title VII to discriminate against employees because they do not conform to ideas of how a certain gender should behave.

These cases will be argued and decided sometime during the Court’s 2019-2020 term, which begins in October.

If you have any questions or would like more information, please contact us at [email protected].

California Attacks Arbitration Agreements …. Yet Again!

Posted on: August 24th, 2018

By: Dave Daniels

On August 22, 2018, the California Senate voted to approve AB 3080, a bill prompted by the #MeToo movement against sexual harassment. Nominally, the bill is intended to combat the use of mandatory arbitration agreements and confidentiality clauses to prevent the public disclosure of workplace sexual harassment, a practice vigorously opposed by the #MeToo movement. As written, however, AB 3080 goes much further, imposing a ban on mandatory arbitration agreements for all claims of employment discrimination, retaliation, and harassment, as well as wage and hour claims.

The bill is currently on Governor Jerry Brown’s desk, awaiting his signature or veto. If signed, the new law would apply to any employment contracts “entered into, modified, or extended” on or after January 1, 2019, and would make several sweeping changes to the California employment law landscape:

Ban on Mandatory Arbitration Agreements

Arbitration agreements are ubiquitous in employment contracts and provide for a low-cost, efficient means of resolving employment disputes.

AB 3080 would put a stop to this by adding Section 432.6 to the Labor Code, which would prohibit any person from requiring an applicant or employee, “as a condition of employment, continued employment, the receipt of any employment-related benefit, or as a condition of entering into a contractual agreement,” “to waive any right, forum, or procedure” for claimed violations of the California Fair Employment and Housing Act (“FEHA”) or the California Labor Code.

In other words, if AB 3080 is signed, it will be unlawful—indeed a misdemeanor—for an employer to require its employees to enter into mandatory arbitration agreements for any claims covered by FEHA (i.e., discrimination, retaliation, harassment) or the Labor Code (i.e., wage and hour claims).

While the bill only applies to mandatory arbitration agreements, Section 432.6(c) makes clear that employers will not be able to sidestep the new prohibitions by using opt-out clauses or otherwise requiring an employee to “take any affirmative action to preserve their rights.”  Moreover, Section 432.6(b) prohibits employers from threatening, terminating, retaliating against, or discriminating against any employee or applicant who refuses to voluntarily sign an arbitration agreement.

Finally, because these new provisions appear in the Labor Code, violations could subject employers to civil penalties under the California Labor Code Private Attorneys General Act, also known as PAGA.

Elimination of Settlement Agreements

Because AB 3080 prohibits any person from requiring an applicant or employee “to waive any right, forum or procedure” “as a condition of entering into a contractual agreement,” it arguably also eliminates or curtails employers’ ability to enter into settlement and general release agreements with their employees for FEHA and Labor Code claims.  Given that the vast majority of these types of claims are settled, the full extent of AB 3080’s impact remains uncertain.

Ban on Confidentiality Agreements for Sexual Harassment

AB 3080 would also add Section 432.4 to the Labor Code, which would bar any person from prohibiting an applicant, employee, or independent contractor, “as a condition of employment, continued employment, the receipt of any employment-related benefit, or as a condition of entering into a contractual agreement,” from “disclosing to any person an instance of sexual harassment that the employee or independent contractor suffers, witnesses, or discovers in the workplace or in the performance of the contract.”

In short, employers will no longer be able to impose confidentiality obligations on their employees or independent contractors with respect to claims of sexual harassment.

Individual Liability

Importantly, AB 3080 applies to any “person” who commits any of the above-noted violations, not just an employer.  An earlier version of the bill was restricted to “an employer,” but was subsequently amended to replace “an employer” with “a person,” signaling the Legislature’s intent to impose individual liability for violations.

What Employers Should Know Now

For the moment, as it awaits Governor Brown’s signature, AB 3080 is still not the law.  In 2015, Governor Brown vetoed a similar bill, AB 465, which would have outlawed the use of mandatory arbitration agreements as a condition of employment.  In his veto message, Governor Brown noted that there is significant debate about whether arbitration is less fair to employees, and explained that he was “not prepared to take the far-reaching step proposed by this bill.”  Remember, however, that Governor Brown’s term ends in January 2019, and a re-introduced version of the bill could find a more sympathetic audience in his successor.

Even if Governor Brown signs the bill, there will be immediate legal challenges arguing that the bill is unenforceable under the Federal Arbitration Act, which the United States Supreme Court has steadfastly enforced, most recently in Epic Systems Corp. v. Lewis. AB 3080 is just the latest in a long history of California’s antagonism towards arbitration agreements, both in the employment context and beyond.

Notwithstanding the hurdles that AB 3080 faces, employers should now begin reviewing their arbitration agreements and practices in light of these potential changes.  In particular, employers will want to think about best approaches to take during the period after the bill is signed and legal challenges work their way through the courts.

If you have any questions regarding the state of arbitration agreements in the Golden State, please feel free to contact Dave Daniels in our Sacramento office at 916-472-3301 or [email protected].

The California State Bar’s New Rule Follows a National Trend of Disciplining Attorneys for Discrimination

Posted on: August 24th, 2018

By: Paige Pembrook

The newly revised California Rules of Professional Conduct for attorneys, set to take effect November 1, 2018, include a tougher approach to discrimination, harassment, and retaliation in legal practice that exposes attorneys to State Bar discipline even where there has been no prior court determination of any wrongful conduct. The new rule is part of a national trend prohibiting discrimination as attorney misconduct.

Current Rule 2-400 that applies through October 2018 prohibits discrimination and harassment in connection with the management or operation of a law practice. Once a court determines that an attorney has committed unlawful discrimination and/or harassment, the State Bar can investigate and impose discipline. Given that no discipline appears to have been imposed under the current rule in the thirty years since its enactment in 1989, the new rule has teeth to allow for greater enforcement.

New Rule 8.4.1 replaces and fundamentally changes the current rule to expand attorneys’ exposure to State Bar discipline for discriminatory conduct. First, Rule 8.4.1 expands the scope of wrongful conduct to explicitly prohibit retaliation as well as discrimination and harassment. Second, Rule 8.4.1 prohibits all such conduct in connection with the representation of a client, the termination or refusal to accept the representation of any client, and law firm operations, whereas the current rule only prohibits conduct in connection with the management or operation of a law practice. Finally, Rule 8.4.1 eliminates the current requirement that there be a prior adjudication by a court that unlawful discrimination occurred before the State Bar can commence an investigation or impose discipline on an attorney for such discrimination.

The elimination of the requirement of a court adjudication of wrongdoing prior to State Bar investigation and discipline is the most drastic and contested change in the rule. Essentially, the State Bar Court becomes a forum of first resort for alleged victims of discriminatory, harassing, or retaliatory conduct by attorneys, despite the State Bar Court having limited resources and due process protections. Concern over the elimination of the prior adjudication requirement led to a new self-reporting requirement for attorneys who receive notice of disciplinary charges for violating Rule 8.4.1. It requires such attorneys to provide the disciplinary charges to the California Department of Fair Employment and Housing, the U.S. Department of Justice, or the U.S. Equal Employment Opportunity Commission, allowing the agencies to become involved and institute parallel administrative or judicial proceedings stemming from the same conduct. Attorneys must also report such parallel proceedings to the State Bar, allowing it to step aside so that the appropriate court or agency can adjudicate the matter.

In sum, the new rule is harsh. The comments to the new rule make clear that it permits the imposition of discipline for conduct that would not necessarily result in an award or remedy in a civil proceeding. Any person (including but not limited to prospective, former, and current employees, clients, and opposing counsel) can file complaints alleging discrimination with the State Bar that trigger investigations and discipline up to and including disbarment. Disciplinary charges may also trigger reporting requirements to government agencies that may lead to further investigations and proceedings.  Discipline for misconduct can also serve as evidence in a legal malpractice claim, demonstrating that an attorney fell below the standard of care. For example, if an attorney’s harassment of a firm employee resulted in that employee missing critical deadlines that impacted the outcome of a client’s matter, State Bar discipline based on that harassment may be evidence in a malpractice action against the attorney.

Although California has had a rule prohibiting discrimination since 1989, the reinforced new Rule 8.4.1 is part of a national trend prohibiting discrimination in the practice of law. In 2016, the ABA approved Model Rule 8.4(g) that makes it professional misconduct to engage in conduct that the lawyer knows or reasonably should know is harassment or discrimination. Twenty states already have provisions in their attorney conduct rules addressing the subject of Model Rule 8.4 in some manner or adopting a version of Model Rule 8.4, including Colorado, Florida, Indiana, Ohio, New Jersey, New York, Michigan, Minnesota, Vermont, and the District of Columbia, to name a few.

California’s new Rule 8.4.1 is one of the strongest prohibitions and goes far beyond the ABA’s Model Rule 8.4 in policing discriminatory misconduct by attorneys. However, other states are likely to follow the ABA and California’s lead in increasing the State Bar’s powers to discipline attorneys for discrimination, retaliation, and harassment. Accordingly, all attorneys should be wary that conduct that was previously considered a professional discourtesy may be actionable misconduct that will lead to discipline, and any resulting discipline may provide evidence of attorney malpractice.

If you have any questions or would like more information, please contact Paige Pembrook at [email protected].

Discrimination Suit Over Service Dog Revived By Third Circuit

Posted on: August 23rd, 2018

By: Barry Brownstein

The Third Circuit has revived a lawsuit by the parents of an epileptic girl who claim a Pennsylvania school discriminated against her by barring her service dog.

In 2014, Traci and Joseph Berardelli sued the Allied Services Institute of Rehabilitation Medicine, which operates a school with a specialized program for dyslexic students, after it barred their daughter from bringing her service dog to school to help alert staff to her epileptic seizures. The school claimed the dog would be a distraction, and the Berardelli’s daughter missed many school days when her seizures were bad. When the school finally permitted the service dog to accompany her, the reprieve did not last long, as school officials required that it wear a “special therapeutic shirt designed to decrease allergens” that caused the dog to overheat. The parents’ lawsuit alleged that the school violated the ADA, the Rehabilitation Act, and a Pennsylvania discrimination law.

The United States District Court for the Middle District of Pennsylvania dismissed the ADA and state discrimination claims, ruling that they improperly sought damages.

On appeal, Traci and Joseph Berardelli argued that “reasonable modifications” required under the ADA are substantively the same as “reasonable accommodations” provided for in the Rehabilitation Act, and thus, service animal requirements in the ADA apply to both laws.

The Third Circuit ruled that the district court erred in its instructions to the jury about the Rehabilitation Act claim and improperly disallowed testimony about ADA service animal regulations because that was not the law being considered.  In its enforcement of the ADA, the Department of Justice has ruled that service animals are reasonably permitted to be used by disabled persons in public places as long as they are housebroken, not out of control, and pose no risk to the public.

The Third Circuit ruled that the Rehabilitation Act of 1973 and its progeny the Americans With Disabilities Act of 1990 must be interpreted the same way with respect to reasonable accommodations that must be provided to those with disabilities, including the use of service animals. Thus, under the Rehabilitation Act just as under the ADA, a covered actor ordinarily must accommodate the use of service animals by individuals with disabilities. The Third Circuit also overturned dismissal of the claim made under Pennsylvania discrimination law, ruling that the district court erred because that law does permit damages as a remedy.

If you have any questions or would like more information, please contact Barry Brownstein at [email protected].

Eleventh Circuit Again Rejects Claim That Title VII Prohibits Discrimination On The Basis Of Sexual Orientation

Posted on: July 23rd, 2018

By: Bill Buechner

In Bostock v. Clayton Co. Bd of Comm’rs, 723 F. App’x 964 (11th Cir. 2018), the Eleventh Circuit again held that Title VII does not prohibit discrimination on the basis of sexual orientation.   In doing so, the panel relied on prior circuit precedent in Evans v. Ga. Reg’l Hosp., 850 F.3d 1248 (11th Cir.), cert. denied, 138 S.Ct.  557 (2017) and Blum v. Gulf Oil Corp., 597 F.2d 936 (5th Cir. 1979).    Jack Hancock and Bill Buechner are representing the County in the case.

Last week, the Eleventh Circuit issued an order denying a request from a member of the Court for rehearing en banc.  Bostock v. Clayton Co. Bd. of Commissioners, 2018 U.S. App. LEXIS 19835,  2018 WL 3455013 (11th Cir. July 18, 2018).   The order was notable because it was accompanied by a dissent by two circuit judges sharply criticizing their colleagues for not agreeing to rehear the case en banc.

The plaintiff in Bostock had already filed a petition for writ of certiorari with the United States Supreme Court, and the County will be filing a response to that petition in the next few weeks.   The employer in Zarda v. Altitude Express, Inc., 883 F.3d 100 (2d Cir. 2018) (en banc) also has filed a petition for writ of certiorari with the Supreme Court seeking review of the Second Circuit’s ruling that Title VII does prohibit discrimination on the basis of sexual orientation.

We will report on the outcome of these pending petitions for writ of certiorari with the Supreme Court.

If you have any questions or would like more information, please contact Bill Buechner at [email protected].