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Legal Report October 2013


HARASSMENT. The U.S. Supreme Court has ruled that employees must meet a strict burden of proof when alleging retaliation and has defined who is a “supervisor” in sexual harassment cases.

The U.S. Supreme Court has ruled that, to prevail on a retaliation claim, an employee must prove that retaliation was the sole motive for the discriminatory action and that the employer would not have taken such action absent a retaliatory motive. The Court chose the more strict interpretation of the statute in lieu of a lesser standard that would have required an employee to prove that retaliation was only one of an employer’s motives.

In the case, University of Texas Southwestern Medical Center v. Nassar, Naiel Nassar was an assistant professor at the University of Texas Southwestern Medical Center’s medical school. Nassar believed that his supervisor, Beth Levine, treated him differently because of his Middle Eastern heritage. Nassar asked to be transferred so that he worked at the hospital, not the medical school. He wanted exactly the same job, but a different supervisor.

Nassar was told that it would violate the operating agreement between the hospital and the school to transfer employment. However, Nassar had a friend working behind the scenes to obtain a place at the hospital. Soon, Nassar received an unsigned offer letter from the hospital.

Believing that he had procured employment at the hospital, Nassar resigned from the school and accused Levine of discrimination based on national origin. The school then learned of Nassar’s planned employment at the hospital and terminated the agreement. Nassar claimed that his offer was rescinded in retaliation for a claim of discrimination. The school argued that the offer was withdrawn because it violated the operating agreement. Nassar filed a lawsuit claiming that the school retaliated against him.

Defending the case before the U.S. District Court for the Northern District of Texas, the school asked the court to instruct the jury that they could only find the school liable if retaliation was the only reason for the decision. It would require that the jury find that the school would not have taken the actions it did “in the absence of retaliatory animus.” The court refused the request and instructed the jury that Nassar need only prove that discrimination was one of many motives for the school’s actions.

The jury found the school liable and awarded Nassar $3.5 million in damages. The damages were later reduced to $735,000.

The school filed an appeal with the U.S. Court of Appeals for the Fifth Circuit arguing that the jury should have been given the instruction. The appellate court found disagreement among other circuits as to which burden of proof should prevail, so the appeals court petitioned the U.S. Supreme Court to hear the case.

The Supreme Court ruling clarified what burden of proof a plaintiff must meet to prevail in a retaliation claim. Employees must now prove that the retaliation was the sole factor in an adverse employment action, not one of the factors.

In the 5-4 decision, Justice Ruth Bader Ginsburg offered the dissenting opinion. Ginsburg noted that the ruling defies the reality of the workplace, where motives cannot be readily teased out and asks courts to “engage in a hypothetical inquiry about what would have happened if the employer’s thoughts and other circumstances had been different.” Ginsburg also accused the Court of being “driven by a zeal to reduce the number of retaliation claims filed against employers.”

In another case, the Court ruled to narrowly define who is a “supervisor” in sexual harassment lawsuits. In the case, Vance v. Ball State University, the Court ruled that a supervisor is someone who is able to take “tangible employment actions” against an employee. This means that a supervisor must be able to fire or demote the employee, not just direct his or her daily duties.

This distinction is important. Under current law, if an employee is sexually harassed by his or her supervisor and the harassment results in an adverse employment action, the company is automatically liable. If the harassment is committed by a coworker, the company can mount a defense. However, the federal appellate courts have been split on what constitutes a supervisor. Some appeals courts have ruled that a supervisor is anyone who directs another employee’s work while other courts have determined that a supervisor must have the power to “hire, fire, demote, promote, transfer, or discipline” the employee.

In Vance, a woman said that she had been sexually harassed by her coworkers. One of the coworkers was responsible for directing the plaintiff’s work. The plaintiff claimed that this made the coworker a supervisor.

The original trial court disagreed because the coworker had no power to demote or fire the plaintiff and, thus, did not meet the definition set forth in previous decisions by the U.S. Court of Appeals for the Seventh Circuit. On appeal, the Seventh Circuit ruled that Vance could not pursue her lawsuit because her coworker was, in fact, not her supervisor.

Because the Seventh Circuit decision was contradictory to those of other appellate divisions, the Supreme Court agreed to hear the case and issue a clarification.

Justice Ginsburg again issued the dissenting opinion for the case, which was split along the same 5-4 lines as Nassar. In the dissent, Ginsburg noted that the ruling ignored the realities of the workplace where those who control daily duties exert considerable influence over employees despite the fact that they lack supervisory control. Ginsburg notes that the power to initiate or make recommendations about tangible employment actions does not always lie solely with supervisors. (University of Texas Southwestern Medical Center v. Nassar, U.S. Supreme Court, No. 12-484, 2013. Vance v. Ball State University, U.S. Supreme Court, No. 11-556, 2013.)

PRIVACY. New York’s high court has ruled that an employer’s around-the-clock tracking of an employee’s movements was unreasonable. The court ruled that while an employer can track an employee’s movements without a warrant in some cases, the tracking was excessive in this specific case.

In 2008, Michael Cunningham was suspected of taking unauthorized absences from work and of falsifying his time sheet. Though Cunningham had been a director of staff and organizational development for 20 years at the time of the allegations, he had been disciplined frequently for workplace misconduct. In an attempt to determine whether Cunningham was submitting false time sheets, the state had him followed. However, Cunningham realized he was being followed and changed his habits. When the state realized that, it placed a GPS tracking device on Cunningham’s car; that was done while the car was parked near his office.

The device submitted location data for 30 days. Based on the GPS evidence, the state determined that Cunningham had given false information about the hours and days he worked and had submitted false vouchers for work-related travel. After Cunningham was terminated, he filed a lawsuit against the state, alleging that his constitutional rights had been violated. The court ruled that the issue was an employment issue and would be considered a civil matter rather than a criminal one. Therefore, Cunningham’s case would hinge on whether the state’s tracking activities constituted an invasion of privacy. The appeals court ruled that the state’s actions were reasonable and did not invade Cunningham’s privacy. The court noted that the tracking device was not monitored in real time, but rather a history of Cunningham’s movements was extracted from the device after it had been removed from his car. Cunningham appealed the decision. New York’s highest court overturned the lower court’s verdict; it ruled that such a search is theoretically allowed without a warrant, but that Cunningham’s employer was “excessively intrusive” in its tracking activities, making those activities unreasonable. In the written opinion of the case, the court noted that the employer went too far when it tracked Cunningham on evenings, weekends, and on vacation. The court wrote: “Perhaps it would have been impossible, or unreasonably difficult, to limit a GPS search of an employee’s car as to eliminate all surveillance of private activity—especially when the employee chooses to go home in the middle of the day and to conceal this from his employer. But surely it would have been possible to stop short of seven day, twenty-four hour surveillance for a full month.” (Cunningham v. New York State Department of Labor, New York Court of Appeals, No. 123, 2013.)


BORDER SECURITY. The U.S. Senate has approved an immigration reform bill (S. 744) that includes border security provisions. The bill must now be taken up in the House of Representatives.

The bill would require that all employers in the United States participate in an enhanced version of E Verify, an employment verification system used to determine whether a prospective employee is allowed to work legally in the United States. Under the bill, the system would be phased in, with federal agencies required to comply within 90 days of the bill’s passage; companies with more than 5,000 employees would have two years, companies with more than 500 workers would have three years, and agricultural employers, along with all remaining employers, would have five years.

S. 744 would establish a Southern Border Security Commission to secure all high-risk segments of the border; the bill also stipulates that high-tech fencing would have to be installed. The bill would also increase the number of illegal-border-crossing prosecutions along certain sectors of the Southwest border region and require additional border patrol stations along the Southwest border region.

Under S. 744, the government would deploy additional mobile, video, and portable surveillance systems, as well as drones along the Southwest border to provide 24-hour surveillance. Rep. Michael McCaul (R-TX), chairman of the House Homeland Security Committee, released a statement criticizing the bill’s border security provisions. McCaul called the bill “a textbook example of government waste” because it “throws arbitrary resources at the border without a long-term national strategy or required outcomes.” McCaul touted his own bill (H.R. 1417), which would require that the Department of Homeland Security (DHS) develop a comprehensive strategy that would include collecting metrics, such as the number of apprehensions, to define the program’s progress.

TRADE SECRETS. A bill (H.R. 2466) introduced by Rep. Zoe Lofgren (D-CA) would make it illegal to reverse engineer a product to discover the secrets of its manufacture. Existing law does not spe – cifically prohibit reverse engineering.

H.R. 2466 has no cosponsors and has been referred to the House Judiciary Committee.


DOMESTIC VIOLENCE. A new bill (S.B. 400) introduced in California would make it illegal for employers to discriminate against employees who were victims of domestic violence. The bill was introduced after Carie Charlesworth, a teacher, was fired after her abusive husband threatened her on the job. S.B. 400 would also require that employers make a “reasonable” effort to protect victims from their abusers. The bill lists changing phone numbers, relocating the employee to another part of the office, and implementing a work-safety plan as reasonable efforts.

The bill has been approved by the California Senate and is now pending in the California Assembly.

This column should not be construed as legal or legislative advice.