Delaware Employment Law Blog

The City of Philadelphia seems to have had more than its fair share of civil rights lawsuits in the last several weeks. The EEOC has had a number of significant successes against employers in Philadelphia and the surrounding areas.

The month of May started on a difficult note for the city. First, there was the backlash when 15 city officers were videotaped beating a suspect just days after a fellow officer was killed in the line of duty.  4 of the officers were later fired for their involvement.

Moore v. City of Philadelphia

Then came the $10m jury verdict in favor of three former Philadelphia police officers.  The officers alleged that they were subject to unlawful retaliation when they opposed racial discrimination and harassment of African-American police officers in their squad.   

Lawrence vs. City of Philadelphia

Then, on May 29, 2008, The Third Circuit reversed and remanded a class action case brought by more than 250 "fire-service paramedics."  The plaintiffs allege that the city's fire department unlawfully withheld overtime pay by misclassifying them as exempt employees under the "fire-service exemption."  A case of indebtedness at the trial court level of the Appellate Court reversed finding that the exemption did not apply.  This narrow reading of FLSA exemption could have broad implications for the City of Brotherly Love.

EEOC vs. NutriSystem Inc.

Not to be outdone by its urban neighbor, Horsham, Pa. has had its own bit of discrimination news.  On May 21, 2008, the EEOC announced that NutriSystem, Inc., had agreed to settle a lawsuit filed by the Commission on behalf of the woman it allegedly fired because she was pregnant.  The pregnancy discrimination settlement cost NutriSystem $82,500.  The employee with initially hired as the temporary recruiter in the company's human resources department and would need a fulltime employee a year later.  One month after she was placed in a leadership training program and three weeks after she announced that she was pregnant, the employee was fired.

NutriSystem, again

The Horsham company saw more problems last week when a former employee and Philadelphia resident filed suit in Federal Court in a class action suit estimated to include that least 400 current and former employees.  The lawsuit alleges that the company violated The Fair Labor Standards Act by underpaying their call center employees.  The company responded that the employees had been properly classified as exempt.

Of course, the first case in this string of settlements was in early May, when Conectiv agree to pay $1.65m to Black workers after the EEOC filed suit against the energy company and its subcontractors for race discrimination.  (See my earlier post, Delaware-based Conectiv Settles Race Discrimination Suit with Philadelphia EEOC for $1.65m.)

The Third Circuit, which governs Delaware, New Jersey, and Pennsylvania, applied a strict interpretation of Rule 23(f) and affirmed dismissal of a class action against Johnson & Johnson. The case, Gutierrez v. Johnson & Johnson, was filed by African-American and Hispanic former J&J employees alleging race discrimination--8,600 employees in all.

The federal District Court in New Jersey declined to certify the group as a class. Notably, the court found that the group had failed to identify any J&J policy that was discriminatory. The court also cited the diversity and size of the group as factors weighing against class certification.

Now, hang in there, this is where it starts to get complicated.

The potential class could have filed an appeal with the Third Circuit after the District Court issued its decision denying certification. But, instead, they wanted to file a motion for reconsideration. J&J agreed to an extension of time for the employee to file their motion. The court granted the requested extension but eventually denied the motion for reconsideration, upholding its denial of class status.

The employee-petitioners sought permission tofile an interlocutory appeal with the Third Circuit. The petition was filed within ten days of the District Court’s denial of their motion for reconsideration but 125 days after the original decision denying class certification.

A petition to appeal must be filed within 10 days. When a motion for reconsideration is timely filed, though, the 10 day-clock stops running until the motion is decided. Here, the employee-petitioners filed their motion within the deadline set by the District Court's scheduling order. That was not enough for the Third Circuit. Instead, the court found that the 10-day requirement was mandatory--within 10 days of the decision denying class certification, the party has 10, and only 10, days within which to file an appeal.

The fact that the motion for reconsideration was timely for purposes of the District Court’s scheduling order did not matter. According to the Third Circuit, much to Johnson & Johnson's relief, Rule 23(f) of the Federal Rules of Civil Procedure is strict and mandatory.

The wise sages at the Workplace Professors Blog, (link to the site here), have posted an excerpt from an article-in progess by Franita Tolson (law clerk to Seventh Circuit Judge Ann Claire Williams).

The theoy of the paper rests on how the courts' involvement is needed to remedy unconscious discrimination. The article, The Boundaries of Litigating Unconscious Discrimination: Firm-Based Remedies in Response to a Hostile Judiciary, is availale on SSSN as an abstract. Here's an excerpt from the abstract:

Unconscious discrimination is actionable under Title VII ..., but scholars [agree] that court regulation of it has failed. Contrary to the alternatives suggested in the literature, placing the burden on the firm to regulate discrimination ex ante is more likely to minimize unconscious, discriminatory behavior, at least more so than tinkering with the ex post remedies available for those few violations that can be proven through Title VII. [T]his article proposes alternative mechanisms for addressing unconscious discrimination that account for its peculiar nature, mainly firm-based remedies that will be more successful than the courts have been in addressing this problem. The difficulty comes in incentivizing the Delaware courts [can incentive] ... firms to address unconscious discrimination ... [via] the duties of care and loyalty, corporate norms, and economic pressure from corporate giants like Wal-Mart.

Hat tip to the Workplace Profs Blog

On Wednesday, the US Supreme Court decided the question, "When Is a Charge a Charge?" According to the Supreme Court's decision in Federal Express v. Holowecki, the answer may leave some employers wanting for more.

Current and former FedEx employees filed an "intake questionnaire" withthe Equal Employment Opportunity Commission (EEOC), alleging that they had been subject to unlawful discrimination based on their ages. The Age Discrimination in Employment Act (ADEA), requires an employee to exhaust her remedies at the administrative level, either with the EEOC or the local state agency, before she can proceed with a civil lawsuit.

The administrative process begins with the complainant going to the EEOC or state agency and completing a Charge of Discrimination. A "Charge" form is a simple, one-page form designed to capture only the most basic information about the allegations; i.e., employer's name and address, number of employees, protected class asserted, adverse action, and a brief narrative.

Here, the plaintiffs filed an "intake questionnaire," instead of a Charge. The former is a "fill-in-the-blank" question and answer form that the complainant would normally fill out after her initial intake interview and Charge are completed.

The EEOC says that a filing will be considered a Charge, "so long as it reasonably be construed to request agency action and appropriate relief on the employee's behalf." The EEOC failed to notify FedEx about the allegations--meaning that FedEx had no opportunity to respond to the claims before being sued. The Court held that the plaintiff should not be penalized for the EEOC's mistake:

The Federal Government interacts with individual citizens through all but countless forms, schedules, manuals, and worksheets. Congress, in most cases, delegates the format and design of these instruments to the agencies that administer the relevant laws and processes. An assumption underlying the congressional decision to delegate rulemaking and enforcement authority to the agency, and the consequent judicial rule of deference to the agency's determinations, is that the agency will take all efforts to ensure that affected parties will receive the full benefits and protections of the law. Here, because the agency failed to treat respondent's filing as a charge in the first instance, both sides lost the benefits of the ADEA's informal dispute resolution process.

The employer's interests, in particular, were given short shrift, for it was not notified of respondent's complaint until she filed suit. The court that hears the merits of this litigation can attempt to remedy this deficiency by staying the proceedings to allow an opportunity for conciliation and settlement. True, that remedy would be imperfect. Once the adversary process has begun a dispute may be in a more rigid cast than if conciliation had been attempted at the outset.

This result is unfortunate, but, at least in this case, unavoidable. While courts will use their powers to fashion the best relief possible in situations like this one, the ultimate responsibility for establishing a clearer, more consistent process lies with the agency. The agency already has made some changes to the charge-filing process. ... To reduce the risk of further misunderstandings by those who seek its assistance, the agency should determine, in the first instance, what additional revisions in its forms and processes are necessary or appropriate.

This decision is disappointing, though not necessarily surprising. The courts are always hesitant to dismiss a plaintiff's claim because of a procedural defect--especially when that defect was not caused by the plaintiff. Despite the sense of unfairness to the employer that results from this case, the Court's decision did contain one small trinket of employer victory. In it's opinion, the Court scolded the Commission to get its act together by evaluating its internal processes in an effort to avoid this sort of beaurocratic oversight again in the future. A small victory for sure. Read the full text of the Court's decision here.