2002-9

UNITED STATES SUPREME COURT

A. Seniority System Trumps Request For A Reasonable Accommodation Absent Special Circumstances

In U.S. Airways, Inc. v. Barnett, 2002 DJDAR 4636 (April 29, 2002, U.S. S.Ct.), the United States Supreme Court ⁽¹⁾ held that ordinarily a request for accommodation by a disabled employee which conflicts with an established seniority system will result in a finding that the requested "accommodation" is not "reasonable." The Court, however, recognized that "special circumstances" could justify holding that the particular accommodation was reasonable, even though in violation of an established seniority rule.

In this case, the plaintiff, Robert Barnett, injured his back in 1990 while working as a cargo handler for defendant U.S. Airways, Inc. Barnett invoked his seniority rights in transferring to a less physically demanding position in the mail room. In 1992, Barnett learned that two employees with more seniority intended to bid on the mail room job he held. Barnett requested U.S. Airways to accommodate him by making exception to the seniority rule and allowing him to remain in his mail room position. Although U.S. Airways allowed him to remain in the mail room position for five months, Barnett was thereafter terminated. Barnett then brought an action under the Americans with Disabilities Act ("ADA") asserting that he was disabled under the terms of the ADA, that he was capable of performing the essential functions of his mail room job and that his retention of the mail room job, even though violative of U.S. Airways' seniority rule, constituted a reasonable accommodation.

The district court granted summary judgment in favor of U.S. Airways. The district court held that a violation of the company's seniority policies would have resulted in undue hardship to both the company and non-disabled employees. The United States Court of Appeals for the Ninth Circuit, however, reversed judgment, holding that a seniority system is merely "a factor in the undue hardship analysis." The Ninth Circuit held that such cases require "a case-by-case fact intensive analysis . . . to determine whether any particular assignment would constitute an undue hardship on the employer." In its petition for certiorari, U.S. Airways requested the United States Supreme Court to decide whether "the [ADA] requires an employer to reassign a disabled employee to a position as a 'reasonable accommodation' even though another employee is entitled to hold the position under the employers' bona fide and established seniority system."

The Court acknowledged that under the ADA an employer may not "discriminate against a qualified individual with a disability." 42 U.S.C. ? 12112(a). The Court further acknowledged that a "'qualified' individual includes 'an individual with a disability who, with or without reasonable accommodation, can perform the essential functions of' relevant 'employment position.'" 42 U.S.C. ? 12111(8), (emphasis added). The Court further noted that the ADA requires employers to make reasonable accommodations for a qualified individual unless such accommodations would impose an "undue hardship on the operation of [its] business." 42 U.S.C. ? 12112(b)(5)(a). Finally, the Court noted that "reasonable accommodation" includes "reassignment to a vacant position." 42 U.S.C. ? 12111(9)(b).

U.S. Airways asserted that the existence of a seniority system trumps, as a matter of law, any request for reasonable accommodation. Barnett on the other hand, asserted that "reasonable accommodation" means "effective accommodation." Therefore, according to Barnett, the Court was only to consider whether the accommodation requested met an individual's disability needs. Barnett conceded that the employer would be permitted to assert that the violation of seniority rules might constitute undue hardship. The Court rejected both approaches. The Court noted that U.S. Airways' assertion that an employer can enforce any disability-neutral rule would eviscerate the meaning of "reasonable accommodation." The Court also concluded that Barnett's interpretation of "reasonable accommodation" was not supported by the language of the statute.

The Court concluded that the determination of whether an accommodation is "reasonable" occurs when the accommodation "seems reasonable on its face, i.e., ordinarily or in the run of cases." The Court concluded that in the absence of the employer's seniority system, Barnett's request for accommodation would have been reasonable. The Court then asked whether the existence of a seniority system means "that the proposed accommodation is not a 'reasonable' one? The Court responded as follows:

In our view, the answer to this question ordinarily is 'yes.' The statute does not require proof on a case-by-case basis that a seniority system should prevail. That is because it would not be reasonable in the run of cases that the assignment in question trump the rules of a seniority system. To the contrary, it will ordinarily be unreasonable for the assignment to prevail.

In reaching its conclusion, the Court relied on cases where collective bargaining seniority rules trumped claims of religious discrimination and claims for reasonable accommodation in the context of the Rehabilitation Act. The Court also noted that employer or employees expect the uniformity of treatment which arises from the use of its seniority system. The Court finally noted that the fact that the present seniority system is not the result of a collective bargaining agreement did not in any way alter its holding.

The Court did note that an employee could show that the reassignment was a reasonable accommodation if "special circumstances" existed. For example, a seniority system which recognized exceptions to a strict application of seniority could constitute special circumstances. Second, special circumstances could exist where the employer retained the right to change the seniority system unilaterally and exercised that right "fairly frequently.

In a separate concurring opinion, Justice Stevens noted that the Ninth Circuit had incorrectly focused on the seniority system in the context of undue hardship and that the seniority system should be analyzed as to whether the accommodation is "reasonable" for purposes of the ADA. However, Justice Stevens noted that questions that still needed to be addressed were whether the mail room position held by Barnett became vacant due to a routine airline schedule change or as a result of a layoff of several thousand employees; whether the accommodation should be viewed as an assignment to a vacant position or maintenance of the status quo; and what impact Barnett's request would have had on other employees.

Justice O'Connor noted, in a separate concurring opinion, that the effect of a seniority system on the reasonableness of a reassignment should depend on whether the seniority system was "legally enforceable." Justice O'Connor further noted that under a valid seniority system, a position should not be viewed as vacant because an individual would either have a contractual right to the position or would be placed in the position.

Justice Scalia, in a dissenting opinion, opined that a bona fide seniority system should create an irrebuttable presumption that an accommodation violating the seniority system would be unreasonable.

Justice Souter in a separate dissenting opinion, joined by Justice Ginsburg, argued that seniority systems should be given no special protection by the ADA

In Oregon Bureau of Labor and Industries v. U.S. West Communications, Inc., 2002 DJDAR 4600 (9th Cir. 4/26/02) the United States Court of Appeal for the Ninth Circuit, ⁽²⁾ held that the defendant U.S. West Communications, Inc. had improperly removed an employment discrimination action pending before the Oregon Bureau of Labor and Industries ("BOLI").

In that case, Darryl Richardson filed a complaint with BOLI against U.S. West for unlawful employment discrimination. BOLI is an Oregon administrative agency, which receives claims of employment discrimination and makes determinations on those claims. U.S. West removed the action to federal court asserting that Richard's claim was entirely preempted by Section 301 of the Labor and Management Relations Act. Upon BOLI's motion to remand, the district court held that the removal was proper. The parties stipulated to a voluntary dismissal with prejudice to the action for the purpose of allowing BOLI to appeal the district court's decision that the removal was proper. On appeal, the Ninth Circuit first addressed whether the case had become moot based on the voluntary dismissal with prejudice of the action. The court held that the action was still a "present, live controversy" because the parties stipulated to the dismissal not for the purpose of settlement, but for the purpose of having the removal heard by the Court of Appeal. The Ninth Circuit concluded that it had jurisdiction to review a denial of a motion to remand if the appeal came from a stipulated voluntary dismissal that was not intended to settle the case. On the merits, the court concluded that the removal was improper because 28 U.S.C. ? 1441(a) authorizes removal only if the action is brought in a "court." The court rejected the "functional test" analysis adopted by the First and Seventh Circuits in Volkswagen de Puerto Rico, Inc. v. Puerto Rico Labor Relations Board, 454 F.2d 38 (1st Cir. 1972) and Floeter v. C.W. Transport, Inc., 597 F.2d 1100 (7th Cir. 1979). The functional test adopted by those courts held that any action pending before a tribunal which "conducts proceedings of an 'essentially judicial character,' or has procedures 'substantially similar to those traditionally associated with the judicial process,' . . . is a 'state court' for removal purposes."

The court concluded that the statute only permits removal from an action pending in a court, and remanded the action with instructions to remand the action back to BOLI.

In Strahan v. Kirkland, 2002 DJDAR 4313 (9^th Cir., April 19, 2002), ⁽³⁾ the United States Court of Appeals for the Ninth Circuit affirmed summary judgment in favor of the defendants Washoe County and its Sheriff, Richard Kirkland.

In that case, plaintiff, John Strahan, a sergeant for Washoe County, Nevada Sheriff's Office, asserted that he had been terminated in violation of 42 U.S.C. ? 1983 based upon his association with a motorcycle club called "Blind Justice." Strahan became employed with Washoe County in 1985. In 1998, the Sheriff's Department began to receive anonymous reports from other deputies that Strahan was associating with inappropriate individuals. An investigation was initially conducted by Lieutenant Douglas Gist of the Office of Personnel Integrity. Gist expressed concern that the "Blind Justice" motorcycle club of which Strahan was a founder leader and member, had joined with a group out of Nevada, which was led by a convicted felon. In June 1998, Sheriff Richard Kirkland met with Gist concerning the possibility that Strahan was associating with ex-felons in violation of County Rule of Conduct 125.013. Kirkland then had Gist removed from the investigation because he believed Gist was focusing on Strahan's involvement with the motorcycle club, which Kirkland believed was protected activity, but continued to investigate Strahan's association with ex-felons. Strahan was disciplined in December 1998 for various items, including operating a motorcycle without a license, filing false articles of incorporation for Blind Justice, and association with ex-felons. Strahan was demoted from the position of sergeant to deputy sheriff and reassigned.

Strahan filed an action in federal court alleging a violation of 42 U.S.C. ? 1983. Strahan asserted that he was terminated based on his constitutionally protected right of freedom of association with Blind Justice. The court affirmed the district court's summary judgment on the grounds that Strahan's disciplinary action did not suggest that the association with Blind Justice was a substantial factor in that decision and that the discipline was based on his association with convicted felons. The court noted that Kirkland was aware of Strahan's association with Blind Justice long before the discipline and that the investigation was careful in distinguishing between that association and violations of departmental orders. Finally, the court noted there was no evidence that the reasons given for the discipline were pretextual. The court further rejected any argument that Gist was somehow biased and that his bias affected Strahan's demotion and transfer.

A. There is no Public Policy That Bars Private Employers from Reacting Adversely to Lawsuits Filed by their Employees.

In Jersey v. John Muir Medical Center, 2002 DJDAR 4119 (Cal.App. April 18, 2002), ⁽⁴⁾ the California Court of Appeal, First Appellate. District, Division Three, held that a hospital's termination of a seven-year at-will employee for prosecuting a lawsuit against a former patient who had assaulted the employee did not violate a fundamental public policy.

In that case, the plaintiff was assaulted by a patient in the rehabilitation unit who was suffering from head trauma. The plaintiff then commenced on a worker's compensation leave and filed a personal injury action against the former patient for battery, assault and sexual battery. The hospital informed her that she must dismiss her lawsuit against the former patient or be considered to have resigned her position. In a letter to plaintiff, the hospital explained that the mission of the hospital was to improve the health of the community it served. Suing a patient who could not be held accountable for his actions because of a medical or psychological condition was in conflict with the hospital's mission and values. When the plaintiff declined to dismiss her lawsuit, she was deemed to have resigned.

Plaintiff's complaint alleged five causes of action. The trial court granted the hospital's motion for summary judgment. In granting summary judgment as to the cause of action for wrongful termination in violation of public policy, the trial court held that it was not a violation of public policy for the hospital to terminate plaintiff for refusing to dismiss her lawsuit against a former patient. The court concluded that there is no public policy that bars private employers from reacting adversely to lawsuits filed by their employees. In addition, the plaintiff was an at-will employee. The trial court also denied a motion for leave to file an amended complaint and granted the hospital's award of attorneys' fees in favor of the hospital.

With respect to the cause of action for wrongful termination in violation of public policy, the Plaintiff grounded her claim on the theory that the termination violated a fundamental public policy because she was terminated for exercising her legal right to bring a lawsuit. She further argued that she was terminated in retaliation for having exercised a right created by Civil Code section 1708.5 which defines sexual battery and provided a statutory basis for one of her claims against the former patient.

The court of appeal noted a distinction between cases which genuinely involve matters of public policy, and those that concern ordinary disputes between employers and employees. In determining whether discharging an employee for exercising a right violates a fundamental public policy, the court stated that the focus is not simply on the importance of the right that was exercised:

The issue is whether permitting an employer to discharge an employee for exercising that right would undermine a 'clearly mandated policy' embodied in the provision from which that right emanates. It must be clear from the provision itself or from some other legislative or regulatory enactment that employers are not free to disregard or limit that right. Although one should not assume that the employer's precise act (e.g., discharging an employee for refusing to commit a crime) must be specifically prohibited for the public policy exception to apply, a constitutional or statutory provision must sufficiently describe the type of prohibited conduct to enable an employer to know the fundamental public policies that are expressed in that law.

In affirming the summary judgment as to the wrongful termination claim, the court concluded:

None of the broad constitutional and statutory provisions plaintiff relies upon reflect a legislative determination that it is against public policy for an employer to insist that its employees not sue its customers, clients or patients. Defendant considered that permitting its staff to file claims against a patient whose conduct may have been affected by the very injuries for which the patient was being treated was contrary to the mission of the hospital and should not be permitted. . . . Even if defendant's decision was misguided or based on an erroneous factual premise, that would not eliminate the need for a clear expression of legislative policy disfavoring a discharge for this reason to support a wrongful discharge claim. While there are policy arguments to be made as to why an employer should be discouraged from preventing its employees from seeking recovery against third parties who injure them during the course of their employment, there are defensible reasons for which an employer may consider such suits contrary to the best interests of the business.

The court also affirmed the grant of summary judgment as to plaintiff's remaining claims for sex discrimination, breach of contract and intentional and negligent infliction of emotional distress.

The court, however, reversed the trial court's award of attorneys' fees to the hospital. The trial court had explained that it had "previously determined by summary judgment that the action was without merit." The court disagreed with this standard, noting that attorneys' fees should be awarded to the prevailing defendant "only where the action brought is found to be unreasonable, frivolous, meritless or vexatious." The Court also reversed the award of attorneys' fees because the trial court neglected to make the non-waivable express written findings necessary to support an award under the FEHA. Although the plaintiff's action was unsuccessful, it could not be considered frivolous.

In Sav-on Drug Stores, Inc. v. Superior Court, 2002 DJDAR 4347 (Cal. App., April 4, 2002), the California Court of Appeal for the Second Appellate District, Division Four ⁽⁵⁾ held that the trial court had improperly certified the class in an overtime pay action on behalf of hundreds of current and former operating managers and assistant managers of Sav-on.

In that case, an action was brought under California law as a class action on behalf of 600 to 1,400 current and former operating managers and assistant managers of 300 Sav-on stores alleging that those employees had been improperly classified as exempt employees and that such employees were entitled to overtime pay for all overtime work performed. The trial court certified the class and the defendant sought a petition for extraordinary relief to review the trial court's order granting class certification.

On appeal, the court reversed as to the propriety of certifying the class. The court noted that under California law for an action to proceed as a class action, certain prerequisites must be met, including that "the questions of law or fact that are common to all members must predominate over the questions of law or fact that are individual to each class member." The plaintiffs asserted that because all of Sav-on's operating managers and assistant managers were treated as exempt employees, the questions of law and fact were common to all members. The defendant, however, asserted that each member of the class had to be evaluated on an individual basis as to whether they spent more than 50 percent of their time performing exempt duties and, therefore, class certification was inappropriate. Defendant submitted 51 declarations from various operating managers and assistant managers describing the nature of their work. The experiences set forth in those declarations showed varying differences in duties performed and the amount of time performed in nonexempt duties, as well as differences in the operation of the 300 Sav-on stores. The court noted that plaintiffs had failed to demonstrate that the amount of time spent by the operating managers and assistant managers in exempt and nonexempt activities were uniform among all class members. The court further rejected plaintiffs' assertion that uniform job descriptions for assistant managers and operating managers, common performance review forms, similar compensation programs, training programs, workweek expectations and lack of studies as to work performed by all of its operating managers and assistant managers were sufficient to justify class certification.

While the court noted that a class action could be appropriate for managerial employees that were improperly classified as exempt. However, in the present case, the different activities and conditions of the potential class made class certification inappropriate.

The court also addressed several evidentiary issues. For example, the plaintiffs had objected to the admissibility of the 51 declarations offered by the defendant. The court noted that the absence of any ruling by the trial court level constituted a waiver of that argument on appeal. The court further ruled that it would not consider the citations by the parties to superior court cases wherein class certification of overtime claims had or had not been granted. The court ruled that those decisions lacked precedential.

In Tomlinson v. Qualcomm, Inc., 2002 DJDAR 4217 (Cal. App., April 17, 2002) the California Court of Appeals, Fourth Appellate District, Division One, ⁽⁶⁾ affirmed a judgment entered in favor of defendant based upon defendant's motion for non-suit at trial.

In that case, the plaintiff, Lona Tomlinson, had been employed by Qualcomm as a manager of business development. At the outset of her employment, she signed an employment contract, which stated that her employment with Qualcomm:

will be at-will, terminable by the employee or the company with or without cause or notice. This supercedes all other agreements on the subject and can be modified only in writing and signed by the chairman of the board of Qualcomm.

So long as you return before the expiration of your FMLA entitlement, you will be returned to your position or an equivalent job with equivalent pay, benefits and terms and conditions of employment . . . [?] Your family leave begins on December 28, 1998. Your job is guaranteed if you return to work by June 14, 1999, based on a 20 hour per week, reduced workweek scheduled Family Leave. Based on this arrangement, you will be returning to active status, 30 hours per week commencing March 22, 1999.

Tomlinson was terminated as part of a companywide workforce reduction on February 2, 1999.

Tomlinson filed a complaint asserted claims for breach of contract, pregnancy discrimination and retaliation and violation of California Family Rights Act (the "CFRA"), termination of employment in violation of public policy and unfair business practices. Qualcomm's motion for non-suit was granted as to all claims upon completion of plaintiff's case with the exception of the discrimination claim. The jury rendered a verdict in favor of defendant. Tomlinson argued that the CFRA barred Qualcomm from terminating her employment. Tomlinson argued that California Government Code Section 12945.2 stated that a family leave under the CFRA would provide a "guarantee of employment in the same or comparable position upon the termination of the leave." The only exception noted in the statute thereto was for a key employee, which did not apply to her.

The court noted that the regulations under the CFRA, specifically California Code of Regulations, Title II, Section 7297.2, stated that "[a]n employee has no greater right to reinstatement or to other benefits and conditions of employment than if the employee had been continuously employed during the CFRA leave" and, further, that "[i]f an employee is laid-off during the course of taking CFRA leave and employment is terminated, the employer's responsibility to continue CFRA leave, maintain group health plan benefits and reinstate the employee ceases at the time the employee is laid-off." The court noted that the regulation was "presumptively valid" and that the regulation permitted Qualcomm to terminate Tomlinson's employment. The court rejected Tomlinson's argument that: (1) the regulation was inconsistent with the statutory scheme; (2) because the statute only mentioned one exception to the CFRA, thus no other exception could be recognized; and (3) the "no greater" right language, which exists under the FMLA, was intentionally not included in the 1998 amendment to the CFRA. The court rejected those arguments asserting that the CFRA clearly did not grant an individual on a CFRA leave with superior rights and that the regulation was not in any way inconsistent with the statute. The court further rejected Tomlinson's breach of contract claims based on the fact that she had executed an express employment agreement. The court first concluded that because the agreement itself could only be modified in writing by a document signed by a chairman of the board, and there was no evidence that such a writing existed, there was no alteration of the express at-will agreement. Further, the court noted that even if Qualcomm's personnel policies and the "guarantee" in the letter to Tomlinson could have constituted a binding modification to her at-will status, no breach occurred because company policy also permitted termination due to reduction in force, which had admittedly been the reason for the termination of Tomlinson. Further, the court rejected Tomlinson's argument based on Qualcomm's handbook, which stated that efforts would be made to place employees returning from a leave and a position, on the grounds that the policy also stated that reinstatement to any position was not guaranteed.

In Colarossi v. Coty U.S., Inc., 2002 DJ DAR 4541 (Cal. App., April 24, 2002), the California Court of Appeal, Fourth Appellate District, Division Three reversed summary judgment in favor of defendant, Coty U.S., Inc. as to the plaintiff's claim for wrongful termination in termination of public policy.

In that case, Colarossi joined Coty as a merchandising specialist. She was named the company's top merchandiser by Deborah Bassett, the Director of Merchandising in 1997. Shortly thereafter, Colarossi's direct supervisor, Diana Roe, accused Bassett of sexual harassment. Roe identified Colarossi as one of the witnesses to the alleged harassment. During the investigation, Colarossi did disclose to the investigator that she had witnessed Bassett engaged in what she believed was sexually inappropriate behavior. Other employees made similar disclosures. As a result of the investigation, Bassett was reprimanded for her conduct. Roe was told she would have to transfer to another state if she chose to keep her job. Roe chose to resign.

After Roe left, Colarossi began to receive negative performance reviews from her new supervisor. Admittedly, Colarossi's record-keeping practices were deficient and she had on occasion forged signatures of supervisors. Colarossi was then terminated ostensibly for those deficiencies after Bassett took the information about Colarossi's performance to a superior.

The court concluded that a triable issue existed as to whether Colarossi was fired for her participation in the investigation of Bassett given that Colarossi had been considered a top-performed until shortly before her termination, Coty had rarely terminated employees for poor record-keeping practices, Roe had allegedly directed Colarossi to forge signatures and Bassett gave information to Colarossi after the investigation that Colarossi had given solely to the investigator in confidence

2. Opinion by J. Nelson.

3. Opinion by J. Boochever; J. Fletcher and J. Fisher concurring.

4. Opinion by J. Pollak; P.J. McGuiness and J. Corrigan presiding.

5. Opinion by P.J. Vogel; J. Hastings and J. Curry concurring.

6. Opinion by P. J. McDonald; J. O'Rourke and J. McConnell concurring.

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