San Antonio Employment Law Blog : San Antonio Employment Lawyer & Attorney : Thomas Crane Law Firm : South Texas, Bexar County TX Wage & Discrimination Issues

The Fifth Circuit overturned summary judgment for the employer in Schroeder v. Greater New Orleans Federal Credit Union, No. 10-31169 (5th Cir. 12/19/11).  The employee was fired after she complained about violations of law and regulation at a credit union.  Mary Schroeder filed suit based on 12 U.S.C. §1790b and La.Rev.Stat.Ann. § 23:967(A).  Sec. 1790 is a whistleblower protection act for credit union employees.  The trial court granted the employer's motion for summary judgment.  The plaintiff was fired Oct. 8, 2008 by the Louisiana credit union.  See Fifth Circuit opinion here. 

The appellate court overruled the summary judgment, finding that the lower court did not construe the available evidence in favor of the non-movant.  Sec. 1790b provides that a credit union employee may file suit if s/he is fired for reporting violation of law or regulation.   The three judge panel found that some evidence supported the employer, but some evidence supported the employee regarding the requirement to show causal connection between her reports of violations and her termination.  The court analogized by using the elements of proof for Title VII retaliation.  

One critical issue was whether Ms. Schroeder reported her concerns to the National Credit Union Association prior to her termination or after her termination.  There was some evidence that she made reports prior to her termination on Oct. 8, 2008.  Letters to the NCUA were dated Oct. 6, although the NCUA did not log them in until Oct. 21.  As the court noted, the trial judge should have construed that evidence in favor of the non-movant.  

Also, several co-workers knew Ms. Schroeder planned to go to the NCUA in June, 2008,  Phone records showed she made several calls to the NCUA in June, 2008.  She has a copy of her two Oct. 6 letters to the NCUA.  And, her attorney sent an email to the NCUA on Oct. 1, 2008.  As the court correctly noted, the lower court was required to view the evidence in light most favorable to the non-movant. So, the court concluded that Ms. Schroeder and her attorney submitted complaints in June and October, 2008 prior to her termination. 

Under Title VII and Sec. 1790b, the employee must show a causal connection between her opposition activity and her termination.  Regarding this causal connection, the court noted that Ms. Schroeder suffered no discipline until she was fired.  And, in fact, the employer praised her performance when she was demoted.  On the other hand, she was said to be "abrasive" to work with.  The court found overall that this evidence regarding her work performance was "neutral."  

Ms. Schroeder was demoted some two weeks prior to her first complaint to the NCUA.  But, her pay decrease came closely after her first calls to the NCUA.  And, her letters and her lawyer's email came shortly before her termination.  The court noted the competing inferences available from this evidence.  But, again, the court must draw inferences in favor of the non-movant.  Refreshingly, the court reaffirmed that such fact issues should be decided by a jury not by the judge.  So, the court found a close temporal proximity between her reports and her termination. 

The court of appeals then reversed the trial judge and sent the matter back to the trial judge for a trial on the merits. 

It is refreshing to hear the Fifth Circuit affirm the right to a trial by jury on key factual issues.  Perhaps, jury trials are not completely gone from the Fifth Circuit. 

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Surina Dixon was hired by Texas Southern University in Houston, Texas to coach women's basketball.  She quit her job in Tennessee and moved to Texas with her husband in 2008.  She noticed soon after she arrived that the new men's basketball coach was paid $148,000 while she was to be paid only $75,000.  She complained.  She said this violated Title IX.  TSU did not respond.  Then, she complained again and mentioned that this was discrimination.  See Houston Chronicle report. 

After only three months on the job, TSU fired her saying they wanted to move in a new direction.  She had signed a three year contract but was fired after only three months.  She sought damages equal to the value of her multiple year contract, and, i am sure, compensatory damages (emotional suffering) under Title VII.   

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Clients and potential clients sometimes ask me what is their case (or potential case) worth?  What little they know of its value is colored by the ubiquitous Personal Injury lawyer ads.  Or, sometimes, their knowledge is influenced by what some brother-in-law knows or thinks he knows.  So, some clients, a small percentage expect wealth and riches.  

Employment cases are not car wreck cases.  The employment discrimination statutes provide for specific types of damages.  Title VII and the Texas law equivalent, Texas Commission on Human Rights Act, provide for lost pay and benefits, compensatory damages, punitive damages and costs of prosecuting the lawsuit which includes attorney's fees.  

So, I am sorry, but the court cannot, even if it wanted, award you the value of the home you lost or the divorce the job loss caused.  That sort of information does help show emotional suffering.  But, no, there will be no dollar for dollar award regarding a lost home.  I wish there were.  The judge cannot award anything not allowed by statute. 

Lost pay and benefits include more than may meet the eye.  It includes lost pay of course.  It includes all lost benefits.  So, save that COBRA letter that records the dollar amount paid by the employer for your medical insuirance.  I do not need to know how much you paid each month out of your paycheck for medical insurance.  I need to know how much the employer paid.  

Lost benefits include retirement benefits.  Terminations involve different calculations than failure to promote.  Lost promotions or raises can affect how much a 401K would grow.  I have had a few clients who could "guesstimate" pretty well how much their retirement would have grown if they had received a particular step increase.  If the client cannot make their estimate, then we may need to hire an economist to study the issue.  

Lost bonuses count.  Of course, the employer will claim bonuses are never guaranteed.  They may even point to policies which provide bonuses are never certain and depend on financial success each fiscal year.  But, if the actual practice suggests that bonuses are likely and that failure to pay a bonus may have been motivated by discriminatory animus, then we have a fact issue regarding bonuses.  If we have a factual issue, then the issue will be decided by a judge or jury.  

Arriving at an amount for compensatory damages is complicated.  Compensatory damages describes damages intended to compensate a person for emotional suffering.  How do we measure emotional suffering?  The best source is actual jury verdicts.  If we can point to a similar case, involving similar discriminatory practices by similar employers and employees, then we rely on such cases.  But, discrimination is rarely the same across industries.  Employers often are different in very critical ways.  So, truly comparable jury verdicts are rare. 

We also look at studies.  There have been a few.  Most studies show that a winning plaintiff in an employment cases gets no compensatory damages.  The few who are awarded some amount are typically awarded an amount equal to or comparable to the amount of lost pay and benefits.  If the discrimination victim is a Vice-President who lost $100,000 in pay and benefits, then the jury in such an instance would award $100,000 in compensatory damages.  If the victim is a warehouse laborer and his lost pay and benefits is $15,000, then the jury who awards compensatory damages awards another $15,000 in emotional suffering damages.  

That may not be fair.  The emotional suffering between the VP and the warehouseman may be the very same level.  They may both lose their homes, marriages and suffer enormously.  But, as I tell my clients, in the legal business, we do not deal in "fair."  We have to deal in reality.  The "real world" is the mode of exchange for most lawyers and judges.  

Punitive damages are very rare, according to studies.  They tend to range across wide extremes. 

Of course, all these amounts are subject to caps.  Title VII and the the TCHR Act are capped at various levels based on number of employees.  The highest cap is $300,000.  So, even the largest employer in the country will never see a larger award than $300,000 in compensatory damages.  

Once in a blue moon, you will see a jury award a million dollars for compensatory damages.  But, that amount will be reduced by a judge to the appropriate cap level.  

So, as I hear from some clients, some brother-in-law may know of an "exact same case" that resulted in a million dollars.  Great, I advise the client, go hire that brother-in-law, because he knows more than I do.  

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A Dallas jury returned a verdict in favor of the plaintiff in US district court.  In an age discrimination case, the jury awarded the plaintiff employee lost pay and benefits of $500,000, liquidated damages of $500,000, mental anguish damages of $1,000,000, punitive damages of $15,00,000, front pay and attorney's fees to be determined later by the judge.  Under Title VII and the Age Discrimination in Employment Act, punitive damages are capped at $300,000.  So, the punitive damages will be reduced probably to $300,000. But, this large amount of punitive damages is still remarkable.  

When a jury becomes angry, they will award large amounts.  The McDonald's spilled coffee case is often referred to as a "runaway jury." But, in that case, the McDonald's executive who testified came across as arrogant.  And, there was evidence that McDonald's knew their coffee posed significant risk, yet the corporation had taken no precautions.  When a jury becomes angry, they will award large amounts. 

Same thing apparently occurred here in Miller v. Raytheon, No. 3:09-CV-0440 (N.D. Texas 2010). The defendant changed their reasons for the adverse personnel action several times.  The employer claimed for the first time at trial that it had offered the employee two jobs that had never been disclosed before.

Perhaps more damaging, however, was Raytheon's claims to the EEOC that it had offered the employee several job openings before selecting him for a RIF.  There was no evidence to support Raytheon's claim and the employee denied he had been offered any such positions.  The company also claimed the employee refused to look for new jobs, despite knowing that claim was false.  There had actually been several discussions between Mr. Miller and Human Resources regarding possible other jobs.  

Juries do not like being lied to.  Once an employer makes statements to the EEOC, those statements become part of the record and cannot be withdrawn.  Fortunately for Raytheon, Title VII punitive damages are capped at $300,000.  Otherwise, they would be looking at a huge judgment, a judgment caused not by some legal technicality, but by plain fabrication.  

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 Facebook is now the third largest country in the world.  That is, if each user of Facebook was a citizen of a country, then that country would be the third largest.  Facebook, Myspace, Linked, the list of social media web sites grows longer each year.  Blogging grows leaps and bounds every year.  Cases in which employers have tried to constrain what its employers write on these sites continues to grow.

Employers have some risk if they try to control what an employee writes.  If an employee posts information about his color, racial background, religion, disability, age or gender and those characteristics then lead to termination at work, the employee may have a right to pursue a discrimination claim.  

Some states, not Texas, have off-duty conduct laws.  Off-duty conduct laws provide that an employee may not be terminated for off-duty conduct that has no effect on the employer.  

An employee might write something online in opposition to discrimination in the workplace.  if the employer then takes some action against that employee, then any resulting adverse personnel action may constitute retaliation.  Retaliation for opposition to discriminatory practices is prohibited by Title VII of the Civil Rights Act of 1964, and all other civil rights statutes. 

If an employee complains online about "terms and conditions" of employment, then the employee is protected by the National Labor Relations Act.  The NLRA was designed to allow unions to form.  Typically unions start with complaints or discussions about workplace conditions.  To qualify, such discussions must be "concerted" and must be for the "mutual aid and protection" of more than one employee.  Concerted activity has always been protected.  But, now it is simply protected in the new online venue. 

That does not mean the employer cannot forbid employees from publicly disparaging their products or the products of competitors.  In one NLRB (National Labor Relations Board) filing, the union started a facebook page.  Sears objected to the extent that the website disparaged Sears products or the products of competitors.  The NLRB essentially agreed. 

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 Recently, I wrote about a study showing that employers are losing more discrimination cases this past year.  This was a study published by Manpower, a human resources firm.  Yet, a separate study by two Cornell professors published in the Harvard Law & Policy Review shows just the opposite, that plaintiffs in employment cases are doing worse.  These two professors are the same persons who prepared a study several years ago showing that employment plaintiffs generally do worse in federal court than other types of plaintiffs.  Well, now, in this latest study, based on data from 1970 to 2006, we see that within the last five years, the number of employment cases has dropped dramatically in federal court.  In 2001, employment cases accounted for 10% of all federal lawsuits.  In 2006, that number dropped to 6%.  I am sure that drop is due to the ever increasing use of summary judgment in employment cases.  

For example, this study finds that while defendants (employers) and plaintiffs (employees) appeal about as often as each other, the defendant is ten times more likely to win on appeal.  Too, the pretrial reversal rate is far higher for defendants (30%) than for plaintiffs (10%).  "Reversal rate" refers to those times when the lower court finds in favor of one party or the other.  If you are a defendant, you have a 30% chance of reversing the district court.  As a plaintiff, you have only a 10% chance of obtaining a reversal.  Pretrial disposition refers primarily to summary judgment and motions to dismiss.  So, when motions for summary judgment or to dismiss are granted, the employer has a 30% chance at getting the decision reversed.  While, the plaintiff has only a 10% chance at reversing the adverse decision.  

Looking at the reversal rate after a trial has occurred, the disparity becomes more clear.  Defendants have a 41% chance of obtaining reversal.  While, a plaintiff (employee) only has a 9% chance of getting the trial result reversed.  Thus, the authors point out, the federal system heavily favors the defendant (employer).  

As the authors explain, this result is counter-intuitive.  Discrimination cases by definition rely on evidence of intent and private conversations.  One would expect reversal of a jury decision to be rare.   Or, one would at least expect that reversal of a jury decision to be about the same for both parties.  Since, trial outcomes in discrimination cases depend so much on credibility determinations by a jury.  Such cases ought to be virtually immune from appellate review.  The appellate judges were not present at trial to observe witness testimony.  The authors believe the best explanation for this apparent discrepancy is that the federal judges have an "attitudinal" bias against such claims.  That "attitudinal" bias would certainly comport with my experience with federal appellate judges.  They are, on the whole, remarkably skeptical of discrimination claims.  

But, so are federal district court trial judges.  They are on the whole just as skeptical of discrimination claims.  The authors note that federal trial level judges are skeptical toward discrimination claimants.  Discrimination plaintiffs are among the least successful sorts of claimants in federal court.  

The data from 1998 to 2006 shows the following success rates for plaintiffs: 

ADA - 9% (Manpower study: employer wins 52%)

Title VII -11%

ADEA -12% (Manpower study: employer wins 33%)

FMLA -20%

The Manpower study I referenced on Jan. 6, 2010 does not describe the source of their data.  This Cornell study published in the Harvard Law & Policy Review drew from federal numbers.  Federal district clerks keep painstaking detail regarding each lawsuit filed.  So, the Cornell study is based on solid data.  The Manpower study relies on data collected by Jury Verdict Research.  My experience with verdict research firms is that they rely on information regarding cases provided to it on an ad hoc basis on its own or from other sources.  The information is still relevant when compared to prior years.  But, JVR's data is probably not as complete as federal systemic data.   So, the Cornell study is scientific, while the JVR study probably is not.  It is fair to say that federal courts remain a very inhospitable place for discrimination claimants.  

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 Well, as often happens, the new decision is out but it will take months or longer to understand what it means.  The US Supreme Court issued its decision in Ricci v. DeStefano, the New Haven, Connecticut firefighters case.  Workplace profs have observed:

"To say that concern over the possibility of a discriminatory effect is itself a discriminatory motive seems to create a terrible theory of discrimination, a moral equivalence, that automatically pits groups against one another in competition for jobs. It's also an implicit rejection of the basis for the Court's early decisions on Title VII, that discrimination in employment was common,. . . "

That causes me concern.  The entire premise of Title VII, as passed in 1964, was that discrimination was a real part of the workplace.  If we have to start re-evaluating basic premises like that, then employment law will essentially start all over.  

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 Title VII of the Civil Rights act of 1964 prohibits discrimination based on sex, color, religion, and national (ethnic) origin.   Other statutes prohibit discrimination based on age and disability.  For Title VII to apply to your company, you must have 15 or more employees.  For the Age Discrimination in Employment Act to apply, you must have 20 or more employees.  Think about that.  Thousands of employers are not covered by Title VII or the other discrimination statutes.  

The intent was not to put too great a burden on smaller employers, the "mom and pop" businesses out there who employ a huge percentage of workers.  That is probably a good thing.  But, if you are being discriminated against by one of these employers, then that is not such a good thing.  A young man came to see me, once.  He had a steady girlfriend, someone he cared about very much.  But, his older female boss and sole proprietor kept "making moves" on him.  She just would not stop.  He was very upset.  He loved his work.  But, this steady pressure to cooperate was taking a toll.  I had to break the bad news to him.  Even with part-time employees, they were way short of 15 employees.  

He left my office knowing he would have to quit or risk losing his job when he was not ready for it.  Plus, his girlfriend was not happy with him for staying there as long as he had.  

In a perfect world, we would all lose or keep our jobs based on our merit.  But, in this world, we often lose or keep jobs through no fault of our own.  Welcome to free (or semi-free) enterprise......

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