On September 11, 2018, the 7th Circuit issued an opinion in which it explained the joint employer doctrine and reversed the district court's decision on summary judgment that an employer management services company was not a joint employer of the plaintiff-employee in her sexual harassment, retaliation, and pregnancy discrimination lawsuit against multiple separate companies. Frey v. Hotel Coleman, et al., No.17-2267 (7th Cir. 9/11/2018). This case presented issues regarding the employer-employee relationship that arise in the increasingly common scenario in which one employer hires another entity to manage the day-to-day operations of an enterprise. One entity provides the paycheck but another entity manages the tasks typically associated with an employer, such as hiring, firing, training, supervising, and evaluating employees. In this case, a hotel hired a management company to handle its daily operations. Under the hotel management agreement, the management company was responsible for hiring, supervising, directing, and discharging employees, and determining the compensation, benefits, and terms and conditions of their employment. The hotel agreed that it would not give direct instructions to any employee of the hotel or the management company that may interfere, undermine, conflict with or affect the authority and chain of command established by the management company. The plaintiff and other staff members who worked at the hotel were on the hotel's payroll, and the management agreement stated that all personnel are in the employ of the hotel.
U.S. District Court, Northern District of Illinois
On September 10, 2018, the 7th Circuit affirmed a jury verdict in favor of a former employee of a big box company, who alleged and testified that she was harassed by a store customer. Equal Employment Opportunity Commission v. Costco Wholesale Corporation, Nos. 17-2432 & 17-2454 (7th Cir. 9/10/2018). The employee testified at trial that she was stalked by a store customer for over a year. Things got so bad at the end that she secured a no-contact order from an Illinois state court. She took unpaid medical leave due to emotional trauma from the experience, and when she did not return to work from medical leave, the company terminated her employment. The Equal Employment Opportunity Commission ("EEOC") filed a lawsuit against the company on behalf of the employee, alleging that the company had subjected her to a hostile work environment by tolerating the customer's harassment. The 7th Circuit held that a reasonable jury could conclude that the customer's conduct was severe or pervasive enough to render the employee's work environment hostile.
On August 27, 2018, the 7th Circuit affirmed the dismissal of a retaliation claim under the Fair Labor Standards Act ("FLSA") for legally insufficient pleading of protected activity. Sloan v. American Brain Tumor Association, No. 18-1103 (7th Cir. 8/27/2018). The plaintiff sued her former employer for unlawful retaliation in violation of the FLSA. The district court dismissed the complaint. The 7th Circuit held that the plaintiff's allegations, even if generously construed, do not remotely support a claim that the defendant retaliated against her for asserting rights protected by the FLSA. Under federal pleading standards, a complaint must state a claim to relief that is plausible on its face. A claim has facial plausibility when the plaintiff pleads facts that allow a court to draw a reasonable inference that the defendant is liable for the misconduct alleged.
On August 20, 2018, the 7th Circuit affirmed an order of summary judgment in favor of the defendant-employer in a disparate impact age discrimination lawsuit filed under the Age Discrimination in Employment Act ("ADEA"). O'Brien, et al. v. Caterpillar, Inc., No. 17-2956 (7th Cir. 8/20/2018). This age discrimination lawsuit was filed by a group of retirement-eligible employees who refused to retire under a "liquidation plan," through which employees who agreed to retire would receive a pro rata share of funds that resulted from the company's elimination of certain unemployment benefits for laid-off employees. The plaintiffs alleged that the liquidation plan violates the ADEA because it has a disparate impact on older employees. The 7th Circuit held that although the liquidation plan has a disparate impact on older workers, it was justified by several reasonable factors other than age.
On August 16, 2018, the 7th Circuit affirmed an order of summary judgment in favor of a defendant-employer in a lawsuit filed under the Americans with Disabilities Act ("ADA"), in which the plaintiff alleged that the defendant discriminated against him, failed to provide him with a reasonable accommodation, and retaliated against him, in violation of the ADA. Koty v. DuPage County, Illinois, No. 17-3159 (7th Cir. 8/16/2018). The plaintiff, a deputy in the DuPage County Sheriff's Department, requested a different model of squad car with more legroom to accommodate a hip condition. After the Department denied his request, the plaintiff filed charges of discrimination with the U.S. Equal Employment Opportunity Commission ("EEOC"), alleging that the Department had discriminated against him in violation of the ADA. Not long after that, the Department reassigned the plaintiff to courthouse duty, for which he would not need to drive a squad car. The plaintiff filed a lawsuit against his employer in federal court alleging that the Department violated the ADA when it denied his request for an SUV, and unlawfully retaliated against him for filing his EEOC charge of employment discrimination by re-assigning him and taking other various employment actions against him.
On August 14, 2018, the 7th Circuit affirmed an order of summary judgment in favor of a defendant-employer in a Title VII retaliation lawsuit filed by a Cook County correctional officer, who alleged that two County employees subjected her to unlawful racial and sexual harassment, and that division supervisors unlawfully retaliated against her for filing grievances by reassigning her to work alongside one of the alleged harassers. Emerson v. Dart, Sheriff of Cook County, Illinois, et al., No. 17-2614 (7th Cir. 8/14/2018). During the litigation, she posted a threat on a Facebook group that she would sue anyone who testified against her, for which she was sanctioned.
On August 2, 2018, the 7th Circuit affirmed a jury verdict in favor of an employee and against an employer in a same-sex sexual harassment and employment discrimination lawsuit. Smith v. Rosebud Farm, Inc., No. 17-2626 (7th Cir. 8/2/2018). The plaintiff worked as a butcher in a local grocery store on the south side of Chicago. After enduring several years of ongoing sexual and racial harassment from his male coworkers and supervisor, he filed a lawsuit against his employer for violations of Title VII of the Civil Rights of 1964, as amended ("Title VII"), Section 1981, and the Illinois Gender Violence Act. The jury returned a verdict in favor of the employee. On appeal, the 7th Circuit held that the evidence supported the inference that the plaintiff's coworkers harassed him because he was male (only male and not female employees were harassed at the grocery store) and, therefore, because male employees were treated differently from female employees, a reasonable jury could conclude that the plaintiff was harassed because of his sex (which is an essential element of a Title VII sexual harassment claim).
On July 30, 2018, the 7th Circuit affirmed an order of summary judgment in favor of a defendant employer in an age and sex discrimination and retaliation lawsuit under Title VII of the Civil Rights Act of 1964 and the Age Discrimination in Employment Act. Hamer v. Neighborhood Housing Services of Chicago, et al., No. 15-3764 (7th Cir. 7/30/2018). The plaintiff was passed over for a promotion in favor of a younger, male colleague. Believing that this adverse employment action constituted age and sex discrimination, she met with the Director of Human Resources, and informed her of her intention to file a charge of discrimination with the United States Equal Employment Opportunity Commission. Subsequent communications ensued between various managerial personnel regarding the non-promotion and related personnel issues in connection with the plaintiff, then employee, who was subsequently given an ultimatum to accept a demotion or resign her employment. She resigned, and filed an EEOC charge, followed by a federal lawsuit.
On July 2, 2018, the 7th Circuit reversed an order of summary judgment on a hostile work environment claim in an lawsuit that involved multiple claims of race-based discrimination, harassment and retaliation. Robinson, et al. v. Perales, et al., Nos. 16-2291 & 16-3390 (7th Cir. 7/2/2018). To succeed on a claim for discrimination based on a hostile work environment, a plaintiff must demonstrate that: (1) she was subjected to unwelcome harassment; (2) the harassment was based on a protected category; (3) the harassment was severe or pervasive to a degree that altered the conditions of employment and created a hostile or abusive work environment; and (4) there is a basis for employer liability. In determining whether the conduct is severe or pervasive enough to alter the conditions of employment, courts consider the severity of the alleged conduct, its frequency, whether it is physically threatening or humiliating, and whether it unreasonably interferes with the employee's work performance.
On June 25, 2018, the 7th Circuit affirmed the district court's grant of summary judgment on a claim for breach of an employment compensation plan, but reversed the district court's grant of summary judgment on the plaintiff's wage claim under the Illinois Wage Payment and Collection Act. Sutula-Johnson v. Office Depot, Inc., No. 17-1855 (7th Cir. 6/25/2018). The plaintiff sued her former employer alleging that its changes to her employee compensation plan for selling office furniture breached its employment contract with her and violated the Illinois Wage Payment and Collection Act (the "Act"). In her claim for breach of employment contract, the plaintiff contended that the defendant did not effectively amend its employment contract with her until she signed a written acknowledgement form on a certain date. She argued that prior thereto, any amendment to her employment contract was without consideration; and that she did not accept the new terms until she signed them. Thus, it was the plaintiff's position that a new contract was not formed until she signed the acknowledgment, and that the defendant breached her previous contract by failing to comply with the old compensation plan through the date she signed the acknowledgement. She also argued that the defendant breached her employment contract by retroactively reducing her commissions.