Practice Area: Employment Law

The Ordinance

On January 23, 2017, the Philadelphia Wage Equity Ordinance (“Ordinance”) was signed by the Mayor.  The Ordinance made it unlawful for any business that employs individuals in the City of Philadelphia to (1) inquire about a job applicant’s wage history (“Inquiry Provision”); or (2) to rely upon wage history information in determining a salary for an employee at any stage in the employment process (“Reliance Provision”).

The Ordinance was set to take effect on May 23, 2017, but the City agreed not to enforce the Ordinance until a lawsuit challenging the constitutionality of the Ordinance was decided.

The Lawsuit/Decision

On April 30, 2018, Judge Goldberg of the United States District Court for the Eastern District of Pennsylvania issued a split decision on the constitutionality of the Ordinance.  The Court enjoined (prevented) the enforcement of the Inquiry Provision on First Amendment grounds, but did not enjoin (allowed) the enforcement of the Reliance Provision.  Because of the constitutional issues that had to be decided, the decision is long and contains a significant amount of legal language.

What Does the Decision Mean

In the short-term, the decision may not have much effect.  Both the City and the Chamber of Commerce will likely appeal Judge Goldberg’s decision to the Third Circuit Court of Appeals. The appeals will take at least another nine months to decide.  In the meantime, the City will probably agree not to enforce the entire Ordinance.

In the long-term, Judge Goldberg’s decision may very well indicate what an employer’s responsibilities will be when interviewing candidates and making job offers in the City of Philadelphia.

Initially, it is important to note that in the decision, Judge Goldberg highlighted that the City defined “employer” via regulation as “any person who does business in the City of Philadelphia through employees” and “who engages in the process of interviewing a Prospective Employee with the intention of considering such Prospective Employee for a position located within the City.” Thus, the Ordinance will only impact businesses that are searching for job candidates that will work within the City of Philadelphia.

Should Judge Goldberg’s decision be upheld, an employer will be permitted to ask about a job applicant’s wage history, because the Inquiry Provision will be invalidated.  Practically speaking, however, the employer will not want to ask a job applicant about salary history, because the Reliance Provision will still be in effect.  Employers will take the view that it makes no sense to ask about information that the employers cannot use.  Practically speaking, an inquiry about wage history will end up in the ash heap of unaskable questions at job interviews.

With that said, if a job applicant “knowingly and willfully” discloses his/her wage history, the employer is permitted to use that information, but only if the disclosure was not prompted by the employer’s questioning.

Businesses that employ individuals in the City need to keep a close eye on this litigation.  In the meantime, no action is necessary, although it would be prudent to begin auditing certain aspects of the hiring process, including review job application formats and interview outlines, to perhaps eliminate any questions regarding wage history.

If you have any questions about the Philadelphia Wage Equity Ordinance, please contact James B. Shrimp at 610-275-0700 or jshrimp@highswartz.com. Our employment law attorneys provide businesses and nonprofit organizations throughout the Pennsylvania region, including Bucks County, Montgomery County, Delaware County, Philadelphia and Chester County with sound advice and excellent representation.

The information above is general: we recommend that you consult an attorney regarding your specific circumstances.  The content of this information is not meant to be considered as legal advice or a substitute for legal representation.

When an employment relationship ends – whether by termination or resignation – employers must be aware of their obligation to pay any wages then due and owing, or be prepared to suffer the substantial consequences.  Under Pennsylvania’s Wage Payment and Collection Law (“WPCL”) 43 P.S. §260.1 et seq., an employer who wrongfully withholds wages from an employee is subject to civil -- and possibly even criminal -- penalties.  The protections afforded by the WPCL apply to all employees based in Pennsylvania.

As a threshold matter, under the WPCL, the employer must notify its employees at the time of hiring not only of the rate of pay, but also of the time and place of payment.

It shall be the duty of every employer to notify his employes at the time of hiring of the time and place of payment and the rate of pay and the amount of any fringe benefits or wage supplements to be paid to the employe...

43 P.S. § 260.4.  Thereafter, employers must timely make such payments as scheduled and agreed upon.

Every employer shall pay all wages, other than fringe benefits and wage supplements, due to his employes on regular paydays designated in advance by the employer.

43 P.S. § 260.3.  Accordingly, every employer is required to pay all wages due to an employee on regularly scheduled paydays which cannot be altered without adequate notice.

Of significant note, the WPCL has a rather expansive definition of “wages:”

"WAGES." Includes all earnings of an employe, regardless of whether determined on time, task, piece, commission or other method of calculation. The term "wages" also includes fringe benefits or wage supplements . . .

43 P.S. § 260.2a.  Therefore, for purposes of the WPCL, wages include not only salary payments, but also other earnings of an employee such as earned commissions, earned bonus payments, unpaid vacation, holiday, or other guaranteed pay.

Of course, the WPCL does not create any substantive right to compensation on the part of the employee; rather, it only establishes an employee's right to enforce – ultimately at the employer’s additional cost and expense -- payment of wages and compensation to which an employee is otherwise entitled under the terms of an existing agreement, whether oral or written.

The WPCL has been described as a state law that provides a vehicle to recover unpaid wages -- and also damages -- in the event an employer improperly withholds compensation from an employee.  The courts have noted that the fundamental purpose of the WPCL is to remove some of the obstacles employees may otherwise face in litigation by providing them with a legal remedy when an employer breaches its underlying obligation to pay wages.

Because the primary goal of the WPCL is to make employees whole again where wages have been wrongfully withheld by their employers, the legislature included the following provision:

The court in any action brought under this section shall, in addition to any judgment awarded to the plaintiff or plaintiffs, allow costs for reasonable attorneys' fees of any nature to be paid by the defendant.

43 P.S. § 260.9a(f).  The Pennsylvania Superior Court has held that:

...the legislature intended a mandatory award of attorneys' fees for a plaintiff who prevails on a claim pursued under the Act. This interpretation is consistent with the general import of the statute, and goes to the very "essence" of its goal of making an employee whole again . . . Otherwise, employees who are unjustly deprived of their wages by their employers, may be deterred from filing suit because of burdensome legal costs . . . Similarly, employees who do file suit and are successful, would be subjected to payment of a substantial part of their award (which represents earned compensation) as attorneys' fees. This would clearly undermine the intent of the statute because employees who are unable to retain their wages will not be made whole. Without an award of attorneys' fees the end result would be only a partial recovery under the statute. Therefore, under the WPCL, an employee who has prevailed on a claim for past wages due, is entitled to attorneys' fees as a matter of entitlement.

Oberneder v. Link Computer Corp., 674 A.2d 720, 723 (Pa.Super.1995).  Of course, the award of attorneys’ fees after a lengthy battle under the WPCL could dwarf the amount of “wages” which had been withheld.

Moreover, the WPCL allows an employee to claim penalties in the form of liquidated damages in an amount equal to twenty-five percent (25%) of the total amount of wages due -- if there is no good faith contest over the payment of wages.  In this regard, the WPCL sets forth the following requirement:

In case of a dispute over wages, the employer shall give written notice to the employe or his counsel of the amount of wages which he concedes to be due and shall pay such amount without condition within the time set by this act. Acceptance by the employe of any payment made hereunder shall not constitute a release as to the balance of his claim.

43 P.S. § 260.6 [emphasis added].

Quite significantly, the WPCL defines an “employer” as follows:

"EMPLOYER." Includes every person, firm, partnership, association, corporation, receiver or other officer of a court of this Commonwealth and any agent or officer of any of the above-mentioned classes employing any person in this Commonwealth.

43 P.S. § 260.2a.  To be clear, the inclusion of every “person,” “agent,” and “officer” within the definition means that each such representative of an employer who played an active role in decision-making may be held personally liable – and subject to not only civil damages, but also criminal penalties.  For obvious reasons, employers need to know their obligations under the law . . . and employees need to know what their rights and remedies are when separated from employment!

If you have questions regarding wages, please contact Eric G. Marttila at (215) 345-8888 or emarttila@highswartz.com

Our attorneys in Bucks County and Montgomery County are here to assist you.

The information above is general: we recommend that you consult an attorney regarding your specific circumstances.  The content of this information is not meant to be considered as legal advice or a substitute for legal representation.

It is a Violation of Federal Law for an Employer to Require an Employee to take a Polygraph…No Lie!

August 29, 2017

By Eric G. Marttila

Nearly 30 years ago, on June 27, 1988, President Ronald Reagan signed the Employee Polygraph Protection Act (EPPA or Act).  The Senate Report, which led to the law’s enactment, indicated 1) that the American Medical Association had concluded that, statistically, polygraphs can provide accurate evidence of deception or dishonesty in people only somewhat better than chance; and 2) that a minimum of 400,000 honest workers were then being wrongfully labeled deceptive and suffering adverse employment consequences each year.  In order to minimize the chances for such wrongful adverse employment actions, Congress passed – and President Reagan signed – the EPPA into law.

As used in the Act [the EPPA is found at 29 USCS §§ 2001 et seq.], the term "employer" includes any person acting directly or indirectly in the interest of an employer in relation to an employee or prospective employee. The term "lie detector" includes a polygraph -- or any other similar device -- that is used, or the results of which are used, for the purpose of rendering a diagnostic opinion regarding the honesty or dishonesty of an individual.

The Act enumerates the following prohibitions on lie detector use, with certain very limited exceptions:

. . . it shall be unlawful for any employer engaged in or affecting commerce or in the production of goods for commerce—

1. directly or indirectly, to require, request, suggest, or cause any employee or prospective employee to take or submit to any lie detector test;
2. to use, accept, refer to, or inquire concerning the results of any lie detector test of any employee or prospective employee;
3. to discharge, discipline, discriminate against in any manner, or deny employment or promotion to, or threaten to take any such action against—
   • any employee or prospective employee who refuses, declines, or fails to take or submit to any lie detector test, or
   • any employee or prospective employee on the basis of the results of any lie detector test . . .

Where an employer violates the Act, private civil actions for those violations are authorized.  Such an employer shall be held liable to the employee or prospective employee for such legal or equitable relief as may be appropriate -- including, but not limited to, employment, reinstatement, promotion, and the payment of any lost wages and benefits.  Such an action to recover damages may be maintained against the employer in any Federal or State court, but must be commenced no more than 3 years after the date of the alleged violation.  Additionally, the court, in its discretion, may allow the prevailing party reasonable costs, including attorney's fees.

However, as stated, the Act does provide certain limited “exemptions” or exceptions to the applicability of the prohibitions, including one for “ongoing investigations.” The EPPA does not prohibit an employer from requesting an employee to submit to a polygraph test if 1) the test is administered in connection with an ongoing investigation involving economic loss or injury to the employer's business -- such as theft, embezzlement, or misappropriation; 2) the employee had access to the property that is the subject of the investigation; 3) the employer has a reasonable suspicion that the employee was involved in the incident or activity under investigation; and 4) the employer executes a statement, provided to the examinee before the test, that, among other things, provides particular details regarding the specific incident or activity being investigated, and sets forth the basis for testing that employee.

Of course, the aforementioned “limited exemption” is, by definition, limited.  By its very clear terms, it does not relieve the employer from any of the other enumerated requirements of the Act.  For example, there is not an unlimited exemption with respect to an employer’s use, acceptance, reference to, or inquiry concerning, the results of a lie detector test.  Similarly, there is not an exemption for an employer’s threatening to discharge an employee should he refuse, decline, or fail to take a lie detector test.

Furthermore, and quite significantly, the Act places stringent restrictions on the use of such exemptions.  It requires that, during the pretest phase, the employee or prospective employee be provided with reasonable written notice of the date, time, and location of the test, as well as of his or her right to obtain and consult with legal counsel or an employee representative before each phase of the test; be informed in writing of the nature and characteristics of the tests; and be informed, in writing as to whether any cameras or other devices for observation will be used and whether any additional recording or monitoring of the test will take place.

Importantly, an employee or prospective employee must be read – and must sign -- a written notice that he or she cannot be required to take the test as a condition of employment; must be provided an opportunity to review all questions to be asked during the test and be informed of the right to terminate the test at any time; and must be advised of his or her legal rights and remedies if the polygraph is not conducted in strict accordance with the Act.  The Act also imposes very specific requirements with respect to the qualifications, and other professional obligations, of the prospective polygraph examiner.  Finally, the Act prohibits the disclosure of information obtained during a polygraph examination.  Generally speaking, a person, other than the employee or prospective employee, may not disclose information obtained during a polygraph test except under limited circumstances.

With regard to those “exemptions” from the Act, therefore, Congress created a limited exemption for an ongoing investigation of an employee's theft. It was the legislative intent that this exemption be narrowly construed and subject to careful restrictions and conditions. Thus, the employer seeking application of any "ongoing investigation" exemption in implementing a polygraph test must provide the tested employee with the procedural safeguards specified. What is clear is that, even under those circumstances, if the employer fails to provide the required information in order to qualify for the exemption, it cannot find safe haven from liability – and exposes itself to civil liability.

Accordingly, employers need to know their obligations under the law -- and employees need to know what their rights are when confronted with such an uncomfortable situation.

If you have any questions, please contact Eric G. Marttila at 215-345-8888 or via email at emarttila@highswartz.com.

The information above is general: we recommend that you consult an attorney regarding your specific circumstances.  The content of this information is not meant to be considered as legal advice or a substitute for legal representation.

August 8, 2017

By James B. Shrimp

There is a common misconception that an employee that works for tips – e.g., restaurant and hotel workers -  are always entitled to the tips they earn.  However, this is not true if the employer pays you at least minimum wage.

Legal Background

The Fair Labor Standards Act (FLSA) is the federal law that applies to the payment of workers – most notably minimum wage ($7.25 per hour) and overtime (time and a half over 40 hours in a week).  Importantly, however, the FLSA does not require an employer to pay its employees their tips in every situation.

In 1974, Congress established an exception to the minimum wage for workers that receive at least $30.00 per month in tips.  The exception (or special minimum wage) is that an employer is permitted to pay the tip-employee an hourly rate of $2.13, so long as the employee receives all of his/her tips.  (29 U.S.C. § 203(m))  This is often referred to as the “tip-credit provision.”  However, the “tip-credit provision” makes no reference to employees that are compensated at the full minimum wage.

In 2011, the Department of Labor (DOL) issued a regulation that declared that tips are the property of the employee regardless of whether the employer pays the employee the special or full minimum wage.  (29 C.F.R. § 531.52)  However, this regulation has been invalidated by a number of Federal Circuit courts, most recently by the Tenth Circuit, on the basis that the DOL did not have the authority to issue the regulation.  See Marlow v. The New Food Guy, Inc., __ F.3d __, 2017 WL 2818874 (10^th Cir. June 30, 2017).  More specifically, a federal agency may issue a regulation only if the statute is silent or vague with respect to an issue and the vast majority of Federal courts believe that “tip-credit provision” is not vague or silent regarding the ownership of tips.

What It Means

Most Federal courts that have reviewed the DOL regulation have determined that the regulation is not enforceable and I don’t anticipate that the Trump administration will continue to attempt to enforce the regulation.

With that said, if an employer pays an employee the full minimum wage, the employer is legally entitled to keep all of the tips.  From a practical standpoint, however, such a policy will negatively effect employee morale.  What is legally permissible is not always best.

For those employers that use the special minimum wage, all tips must be passed on to the employee.

If you have any questions, please contact James B. Shrimp at 610-275-0700 or via email at jshrimp@highswartz.com.

The information above is general: we recommend that you consult an attorney regarding your specific circumstances.  The content of this information is not meant to be considered as legal advice or a substitute for legal representation.

July 25, 2017

By Thomas D. Rees, Esq.

On May 23, 2017, the Pennsylvania Superior Court issued an important employment law decision, affecting everyone who works with children.  In Krolczyk v. Goddard Systems, Inc., ___ A.3d ___, 2017 WL 2255554 (Pa. Super. May 23, 2017), the Court allowed ex-employees to sue for wrongful discharge after being fired for planning to report suspected child abuse.  Krolczyk arose after a Harrisburg Goddard preschool terminated two child care teachers for planning to report suspected home abuse of a 4-year old preschooler to the state.  The child had a long pattern of violent and disruptive physical and verbal conduct toward teachers and other children.  Such conduct is one indicator of possible abuse.  The matter came to a head after the child bit one of the teachers and had to be restrained.  The teachers then called the Department of Education hotline to ask how to address their suspicions of abuse.  The hotline told the teachers to discuss their suspicions with the center’s manager and then make a formal report of suspected child abuse to the Department of Public Welfare (“DPW”).  The teachers informed the manager of the suspected abuse and told her of their intent to report to DPW.  The manager fired the teachers later that day, and then sent a letter to school parents stating that the dismissal was carried out for the good of the children.

The teachers sued Goddard for discharging them in violation of a clear Pennsylvania public policy protecting children.  The teachers claimed that the Pennsylvania Child Protective Services Law requires teachers who have direct contact with children to make a report when there is reasonable cause to suspect child abuse.  Thus, the teachers had a legal duty to report the suspected abuse.  The teachers also sued for defamation based on the manager’s letter to parents.

The trial court dismissed the teachers’ claims and granted Goddard summary judgment.  The court held that there was a legitimate basis for the discharge, since the teachers had not followed proper procedures in restraining the child.  The court stated that where two grounds exist for an employee discharge, and one ground is reasonable, the discharge should be upheld.

The Superior Court overturned the trial court’s dismissal of the wrongful discharge claim, allowing the claim to go to a jury, while upholding dismissal of the defamation claim.  The Superior Court rejected the trial court’s analysis and held that the school terminated the teachers for reporting the suspected abuse.  The court noted that Goddard had not fired other employees who had been accused of restraint violations.  Only the plaintiffs had been fired, right after expressing an intent to report suspected abuse.  In essence, the court concluded that the restraint issue was a pretext, or a make-weight, used to support the teachers’ dismissal.

The Superior Court’s decision is sound, given the statutory duty to report child abuse.    Child care workers and teachers who report abuse now join the small class of employees who can bring wrongful discharge claims.  Such claims are available only employees with no contract that limits the employer’s ability to discharge.  The employee must show that the discharge results from either the employee’s exercise of a legal right, performance of a legal duty, refusal to perform an illegal act, or reporting an illegal act.  Further, if a statute provides a remedy for a discharge, the employee must use the statutory remedy rather than sue for wrongful discharge.

If you have any questions, please contact Thomas D. Rees at 610-275-0700 or via email at trees@highswartz.com.

The information above is general: we recommend that you consult an attorney regarding your specific circumstances.  The content of this information is not meant to be considered as legal advice or a substitute for legal representation.

June 27, 2017

By Thomas D. Rees

Two years ago, I blogged about a National Labor Relations Board decision restoring an employee’s job after the employee posted a profane blog about his supervisor’s mother- “Can You Insult Your Boss’s Mother at Work and Avoid Dismissal?  Maybe so!”

After a recent Second Circuit decision, we can now change “Maybe so” to “Yes!”  In National Labor Relations Board v. Pier Sixty, LLC, 855 F.3d 115 (2d Cir. 2017), the Circuit Court unanimously affirmed the NLRB’s reinstatement decision.

The original NLRB decision,  Pier Sixty, LLC and Perez, 362 NLRB 59 (March 31, 2015), arose after a supervisor issued harsh, loud orders to employees.  Right away, one employee (Perez) posted comments on Facebook calling the supervisor an obscene name.  Then Perez directed obscene Facebook  comments at the supervisor’s mother and “entire family”.  The employer fired Perez.  By a 2-1 vote, the National Labor Relations Board (NLRB) held that the firing violated the National Labor Relations Act, and ordered Perez’s reinstatement, because Perez had engaged in protected, concerted activities.

The factual context of the case is important.  The employer was a New York City caterer.   The employees had complained about management mistreatment.  A union election was imminent.  The employer had imposed a “no talk” rule on employees pending the election.  At  a banquet, the  supervisor loudly told the employee and other servers to “stop chitchatting” and then loudly ordered the staff to “Spread out, move, move” within guests’ earshot.

The supervisor’s order upset Perez.  A co-worker suggested that Perez take a break to cool down.  While on break, Perez posted his  Facebook messages.  After the obscene comments, Perez concluded by saying, “Vote YES for the UNION!!!!!!!”

The NLRB found that Perez addressed supervisory mistreatment of employees and  sought redress through the union election, and so his comments were protected concerted activity.  Perez’s vulgarity was an impulsive act that did not turn his outburst into unprotected activity.  The NLRB also considered whether the employer found the language offensive and prohibited the language, and whether firing Perez was disproportionate to his offense.  The NLRB noted that vulgar language filled the workplace.  (None specifically was directed at others’ families, however.)  Employer rules prohibited profanity, but no such rule was produced during the NLRB proceedings.

The NLRB decision did not end the  battle, however.  The NLRB petitioned to the Second Circuit to enforce its decision.  Pier Sixty petitioned to review and overturn the decision.  The appellate courts’ review of NLRB decisions defers strongly to the agency.  On factual findings, the Second Circuit must uphold the NLRB if “substantial evidence in light of the record as a whole” supports the NLRB.  “Substantial evidence” means “such relevant evidence as a reasonable mind would accept as adequate” to support the NLRB’s conclusion.  On legal issues, the courts have more latitude to overturn an agency but must still give considerable deference to the Labor Board.

Applying these standards, the Second Circuit upheld the NLRB.  The Second Circuit recounted the adversarial labor/management atmosphere at Pier Sixty and the fact that profanity was tolerated in the workplace.  The court also noted that the comments appeared on an online forum, not in front of customers, and that the employee had removed the post after learning that the post was being viewed publicly.  The court did hold, however, that the Facebook post was “at the outer bounds of protected, union-related comments” and referred to the need to be sufficiently sensitive to employer’s legitimate disciplinary concerns.

Given the Second Circuit’s cautionary language, and a possible rollback on pro-union decisions with a new NLRB, the Pier Sixty decision may stand alone for the foreseeable future.  But the issue of what an employer may do to limit workplace speech without violating labor laws will arise again and again in this era of social media communication.

If you have any questions, please contact Thomas D. Rees at 610-275-0700 or via email at trees@highswartz.com.

The information above is general: we recommend that you consult an attorney regarding your specific circumstances.  The content of this information is not meant to be considered as legal advice or a substitute for legal representation.

May 10, 2017

By James B. Shrimp

Last week the U.S. House of Representatives passed House Resolution 1180, entitled the Working Families Flexibility Act of 2017 (“WFFA”). Consideration of the WFFA is now onto the Senate. The WFFA will amend the Fair Labor Standards Act to permit an employer, at the employer’s option, to provide it’s employees with compensatory time in lieu of overtime.  Should certain conditions apply, the employee will receive 1.5 hours of compensatory time for each hour of overtime worked.

Conditions

Under the WFFA, an employer may only provide compensatory time only if – (1) there is a written agreement wherein in the employee agrees to accept compensatory time in lieu of pay; (2) entered into voluntarily; and (3) the employee has worked with the employer for at least 1,000 hours during a 12-month period of continuous employment.

Hour Limit/Payout

Under the WFFA:

• an employee may not accrue more than 160 hours of compensatory time (approximately 105 overtime hours)
• there is no carry over to the next year, e., should an employee have unused compensatory time on December 31 of any given year, it must be paid out to the employee on or before January 31 of the next year.
• if an employee has earned compensatory time in excess of 80 hours, the employer has the right to pay out any compensatory time hours exceeding 80 hours.
• An employee may withdraw from the compensatory plan, or seek payment for all compensatory time with 30 days notice to the employer.

Use of Time

Under the WFFA the employee has a right to utilize his/her compensatory time within a reasonable time after making the request if the use of the compensatory time does not unduly disrupt the operations of the employer.

Termination of Plan

Any employer that has instituted a compensatory time policy under the WFFA may terminate the plan on 30 days notice.

Compensatory time is at the employer’s option, but only with agreement of the employee.  There is not much in the WFFA to object to – so keep your eye on it – the White House has advised that if the WFFA stays in its current form President Trump will sign it.

If you have any questions about employment law, please contact James B. Shrimp at 610-275-0700 or via email at jshrimp@highswartz.com.

The information above is general: we recommend that you consult an attorney regarding your specific circumstances.  The content of this information is not meant to be considered as legal advice or a substitute for legal representation.

April 5, 2017

By James Shrimp

Imagine getting married, legally, on Saturday and then getting terminated by your employer on Monday because of who you married?  For members of the LGBT community that is a possibility for which currently there is no, or very limited, legal recourse.  But the tide may slowly be changing.

On July 28, 2016, the Seventh Circuit dismissed a sexual orientation claim, ruling that until Congress or the Supreme Court acts, Title VII does not protect against discrimination in the workplace based on sexual orientation.  That decision is not remarkable, as all of the Circuit Courts, save the Ninth Circuit, currently share that view.  What makes it remarkable is that the Seventh Circuit expressed significant frustration over the current state of the law, explaining why the current jurisprudence on sexual orientation discrimination is cumbersome and unworkable – but adding, that their hands were tied until Congress or the Supreme Court speaks on the issue.

Background

Important to a discussion on Title VII, sexual orientation discrimination, is the Supreme Court’s 1989 decision in Price Waterhouse v. Hopkins.  In Price Waterhouse, the Supreme Court held that Title VII, as written, does prevent discrimination based on sex/gender stereotypes, but not sexual orientation.  Thus, an employer is not permitted to discriminate against a male employee because he dresses to “feminine” or a female employee that is too “aggressive”, but the employer is permitted to discriminate against an employee because he married another man.

But that begs the question, is not discrimination against a male, because he has a relationship with another male, the violation of a stereotype?  This is the seeming lack of logic within the current state of the law.

EEOC Decision in Baldwin

Last year, in a case involving a Federal employee, the EEOC ruled that Title VII prohibits discrimination based upon sexual orientation for a number of reasons, including that “sexual orientation discrimination … is based on gender stereotypes in which employees are harassed or punished for failing to live up to societal norms about appropriate masculine and feminine behaviors, mannerisms and appearances.”  The EEOC than criticized Federal courts for trying to distinguish between sexual stereotype and sexual orientation discrimination.  However, EEOC decisions do not have the force of law, but this EEOC decision has led to some Federal Courts taking another look at their own sexual orientation discrimination decisions.

The Current Analytical Quagmire

Currently, the Federal Courts recognize claims from LGBT employees who couch their Title VII claims as sexual stereotype claims, not sexual orientation claims.  Thus, the law currently sanctions the absurd conclusion that “the law protects effeminate men from employment discrimination, but only if they are (or are believed to be) heterosexuals.”  But, if the effeminate man is openly homosexual, the individual has no protection.

Since most instances sexual orientation discrimination have their genesis in the violation of a sexual stereotype the Courts have found the line between sexual orientation and sexual stereotype discrimination difficult to pinpoint and difficult to apply.  This is evidenced by the fact that some Courts have disallowed most, if not all, sexual stereotype claims – throwing the baby out with the bathwater.

The Seventh Circuit in its decision concluded that “the distinction between sexual stereotype and sexual orientation claims has created an odd state of affairs in the law in which Title VII protects LGBT individuals, but only to the extent that those individuals meet society’s stereotypical norms about how LGBT men or women look or act.”    The Seventh Circuit mused that the current state of the law creates “a paradoxical legal landscape in which a person can be married on Saturday and then fired on Monday for just that act … from an employee’s perspective, the right to marriage might not feel like a real right if she can be fired for exercising it.”

With all of that said, however, the Seventh Circuit concluded that only when Congress or the Supreme Court acts, will sexual orientation discrimination be prevented by Title VII.

Takeaway

It is still Federal law in the vast majority of the United States that there is no protection for sexual orientation discrimination (although most major cities have adopted their own ordinances/statutes providing protection).  However, the Seventh Circuit’s decision and analysis reflects a Federal Court system anxious for Congress and the Supreme Court to provide clarity on the bounds of Title VII with respect to sexual orientation.  In the meantime, those who are discriminated against based on sexual orientation and the Courts hearing those cases, will continue to split the hairs, presuming any hairs exist in reality, between sexual stereotype and sexual orientation discrimination.

If you have any questions, please contact James Shrimp at 610-275-0700 or via email at jshrimp@highswartz.com.

The information above is general: we recommend that you consult an attorney regarding your specific circumstances.  The content of this information is not meant to be considered as legal advice or a substitute for legal representation.