The Ninth Circuit Court of Appeals issued an important decision last week in Rizo v. Yovino, holding that an employer may not use an employee’s prior salary history to justify gender pay disparity under the federal Equal Pay Act.
Lots to talk about in the Labor & Employment world! The Massachusetts Pregnant Workers Fairness Act went into effect on April 1, 2018, imposing stricter non-discrimination rules on employers of pregnant workers. The U.S. Department of Labor launched the Payroll Audit Independent Determination program, which encourages employers to self-report wage and hour violations. The Sixth Circuit issued a decision in EEOC v. R.G. & R.G. Harris Funeral Homes, holding that transgendered employees are protected under Title VII, even mounted against an employer’s religious objections under the Religious Freedom Restoration Act. The Commonwealth of Massachusetts lost a step in the legal challenge to the contraceptive mandate exemptions in the Affordable Care Act, on the grounds that it did not have standing to assert the relief it sought. Still on the federal landscape, Congress added an amendment to the FLSA in the recent omnibus budget bill, providing that an employer may not keep tips received by its employees for any purpose. The Supreme Court issued an important ruling holding that service advisors are exempt from the FLSA’s overtime requirements and rejecting the principle that FLSA exemptions should be narrowly construed. The State of Washington followed suit with many other states, including California, New York, and Massachusetts, becoming the most recent state to add an updated Equal Pay Act, and a “Ban the Box” law. In the wake of the #MeToo movement, Washington also barred nondisclosure agreements in sexual harassment suits. As always, stay tuned for further updates and more details on these developments which we will be covering more extensively here in the coming weeks, including a post on the Massachusetts Pay Equity Act coming up later this week.
Finally, there’s still time! Don’t forget to register to attend our Fourth Annual Employment Law Summit on April 19.
The U.S. Court of Appeals for the Sixth Circuit ruled on March 7 that employer R.G. & G.R. Harris Funeral Homes unlawfully discriminated on the basis of sex when it fired a transgender employee after she informed the company that she would begin presenting consistent with her gender identity. In so doing, the court emphatically rejected the employer’s defense invoking religious liberty to discriminate on the basis of sex and other protected minorities. On the heels of the Second Circuit’s decision in Zarda v. Altitude Express, this case represents a further affirmation that existing civil rights laws protect LGBTQ employees from both gender identity and sexual orientation discrimination.
On Monday, for the second time in less than a year, a federal appeals court ruled that Title VII forbids sexual orientation discrimination because it is a form of sex discrimination. This time, in Zarda v. Altitude Express, Inc. the Second Circuit overturned decades of precedent and ruled that Title VII’s ban on discrimination “because of . . . sex” encompasses discrimination based on sexual orientation. The decision is also an apparent rebuke of the position taken by the United States Department of Justice (contrary to the Equal Employment Opportunity Commission’s position) that sexual orientation discrimination was never intended to by Congress to be covered by Title VII. The issue is almost certainly headed to the Supreme Court in its next term.
In the case of DiFiore v. CSL Behring, LLC, the Third Circuit ruled for the first time that the more demanding “but for” causation standard applies to retaliation claims under the False Claims Act (“FCA”), rejecting the lower “motivating factor” (also commonly known as the “mixed-motive”) standard. The Third Circuit’s ruling is a welcome result, especially for employers who deal with the federal government and may, therefore, be exposed to FCA retaliation claims. But, employers need to be mindful that different causes of action have different causation standards. For example, the more stringent “but for” standard applied by the Third Circuit to FCA retaliation claims also applies in Title VII retaliation and ADEA cases, but the lower “mixed motive” standard applies in other cases, including “status based” Title VII and ADA discrimination claims. So, employers are left with a mishmash of different causation standards to consider when assessing risk around employment decisions and defending cases.
The federal courts in D.C. have long held that denial of a lateral transfer does not violate Title VII for the reason that, unlike where a promotion is denied, there is no adverse employment action when an employee is denied a purely lateral transfer. A panel of the D.C. Circuit recently decided otherwise where the employee proffered evidence that the employer’s discriminatory denial of his lateral transfer request would have an “adverse impact on the employee’s potential for career advancement.”
Last month, the EEOC filed a lawsuit against Estee Lauder in a Pennsylvania federal court alleging that Estee Lauder’s parental leave policy discriminates against employees on the basis of gender by providing unequal benefits to biological mothers and fathers. What’s notable about this lawsuit is that it involves a policy which, on its face, uses a “primary” and “secondary” caregiver distinction that provides different amounts of leave to employees based on that distinction without regard to their gender – a practice used by many employers in their parental leave policies. This lawsuit has left many employers wondering whether such a policy is at risk of being unlawful. We do not think it is at this time.
After the Eleventh Circuit denied a petition for rehearing en banc last week in Evans v. Georgia Regional Hospital, LGBT advocacy group Lambda Legal announced that it will appeal the dismissal of its client’s complaint to the United States Supreme Court. Evans will petition the Court to hear the case and to hold that Title VII’s prohibition against sex discrimination includes a prohibition against sexual orientation discrimination. The Seventh Circuit created a circuit split on this issue in April when a majority of its judges decided that sexual orientation discrimination is per se sex discrimination; we wrote about that decision here.
The Second Circuit has denied a plaintiff’s request to rehear argument en banc (that is, before all of the court’s judges) in a case alleging that Title VII of the 1964 Civil Rights Act prohibits discrimination based on sexual orientation. As the court is already scheduled to hear argument en banc on this issue in another case in September, the court’s decision is not especially surprising. As we’ve discussed in several posts (see here, here and here), the federal appeals courts are currently divided on this issue and it is likely that the Supreme Court will ultimately have to decide whether Title VII’s language prohibiting discrimination “because of … sex” is broad enough to encompass discrimination based on an employee’s sexual orientation.
A recent Fourth Circuit ruling in a case handled by Mintz Levin provides some comfort to employers concerned about terminating an employee who they believe has made a false complaint of discrimination. In Villa v. CaveMezze Grill, the Court ruled that an employer who fires an employee based on a good faith belief she engaged in misconduct is not liable for retaliation even if it later turns out that she had not, in fact, engaged in the misconduct. Affirming the lower court’s entry of summary judgment in a unanimous published opinion, the court opined that the employer could not be liable for retaliation because it lacked a retaliatory motive when it terminated a former employee. That is because the employer did not terminate the employee in retaliation for reporting the alleged harassment, but rather because it genuinely – albeit mistakenly – believed she had fabricated the report.