On November 20, 2018, the 7th Circuit affirmed an order of summary judgment in a lawsuit in which the plaintiff alleged that her employer violated the Family and Medical Leave Act ("FMLA"), the Americans with Disabilities Act ("ADA") and Title VII of the Civil Rights Act of 1964 ("Title VII"). Riley v. City of Kokomo, Indiana Housing Authority, No. 17-1701 (7th Cir. 11/20/2018). The plaintiff worked for the Kokomo Housing Authority for eight years before the termination of her employment. During her employment, the plaintiff suffered from various disabilities, which required her to take leaves of absence. She alleged that the housing authority improperly denied her requests for medical leave and retaliated against her for those requests by disciplining and terminating her, in violation of the FMLA. She further alleged that the housing authority failed to provide her with reasonable accommodations for her disabilities and discriminated as well as retaliated against her in violation of the ADA. She also claimed that she was subjected to retaliation for engaging in protected activity in violation of Title VII.
U.S. Court of Appeals, Seventh Circuit
On November 1, 2018, the 7th Circuit affirmed an order of summary judgment in favor of an employer-defendant on a breach of contract claim brought by a former employee-physician, who alleged that the defendant breached her employment separation agreement by releasing a credentialing form with some "fair" ratings to a potential employer. Gallo v. Mayo Clinic Health System-Franciscan Medical Center, Inc., No 17-1623 (7th Cir. 11/1/2018). The plaintiff resigned her employment and entered into an employment separation agreement to prevent the defendant from saying anything negative about her to prospective employers in response to employment inquiries. Subsequently, her former supervisor rated her performance as "fair" on two criteria in a credentialing form. She sued for breach of the separation agreement, alleging that as a result of the breach, she was not hired for a subsequent position by a prospective employer with whom she had entered into employment contract negotiations. The separation agreement indicated that no reference will be made to any performance issue and nothing derogatory will be stated to potential employers seeking a reference.
On October 30, 2018, the 7th Circuit affirmed an order of summary judgment in favor of the defendant-employer in a Title VII lawsuit in which the plaintiff, a former dental assistant at a Veterans Affairs dental clinic, alleged that he was discriminated against based on his gender (male) and race (Hispanic), he was retaliated against for filing EEO complaints, and he faced a hostile work environment. Abrego v. Wilkie, Secretary of Veterans Affairs, No. 17-3413 (7th Cir. 10/30/2018). Under Title VII of the Civil Rights Act of 1964 ("Title VII"), it is unlawful for an employer to discriminate against an employee based on race, color, religion, sex, or national origin. To prevail on a Title VII employment discrimination claim, a plaintiff-employee must prove three elements: (1) she is a member of a protected class; (2) she has been subjected to an adverse employment action; and (3) that the employer took the adverse job action on account of the employee's membership in the protected class.
On October 22, 2018, the 7th Circuit ruled that the district court erred in invalidating a waiver clause in the parties' arbitration agreement, vacated the district court's order enforcing a $10 million arbitration award in a collective action under the Fair Labor Standards Act for multiple wage claims, and remanded the case to the district court to conduct the threshold inquiry regarding class or collective arbitrability to determine whether the arbitration clause of the employment agreement authorizes collective arbitration. Herrington, et al. v. Waterstone Mortgage Corporation, No. 17-3609 (7th Cir. 10/22/2018). The plaintiff-employee filed a collective action against her employer for alleged minimum wage and overtime wage and hour violations of the Fair Labor Standards Act ("FLSA"). A collective action allows similarly situated employees to opt in to the lawsuit. The district court compelled arbitration pursuant to the arbitration agreement between the employer and employee, but struck down as unlawful a waiver clause that appeared to forbid class or collective arbitration of the plaintiff's claims. The arbitrator conducted a collective arbitration over the employer's objections and awarded more than $10 million in damages and attorneys' fees to the plaintiff and 174 similarly situated employees.
On October 15, 2018, the 7th Circuit reversed an order of summary judgment that the district court had entered in favor of the defendant-employer in a Title VII lawsuit in which the plaintiff alleged that her former employer unlawfully terminated her employment in retaliation for her protected activity of filing an internal complaint of sexual harassment with human resources against a manager who had sexually harassed another employee. Donley v. Stryker Sales Corporation, No. 17-1195 (7th Cir. 10/15/2018). The 7th Circuit held that suspicious timing and shifting, inconsistent explanations from the employer raised genuine issues of material fact about the reason for the termination sufficient to preclude summary judgment.
On October 12, 2018, the 7th Circuit affirmed an order of summary judgment in favor of a defendant-employer in a Title VII gender discrimination lawsuit in which the plaintiff-employee alleged that she did not get the same chance to resign her employment with severance pay that three male employees got. Barbera v. Pearson Education, Inc., No. 18-1085 (7th Cir. 10/12/2018). The district court granted summary judgment because the proposed comparator male employees were not similarly situated to the plaintiff. They sought resignation with severance pay before circumstances with the employer materially changed, but the plaintiff sought resignation with severance pay after circumstances changed. Title VII of the Civil Rights Act of 1964 ("Title VII") makes it unlawful for an employer to fail or refuse to hire or to discharge any employee, or otherwise discriminate against any employee with respect to her compensation, terms, conditions, or privileges of employment, because of her race, color, religion, sex, or national origin. Gender discrimination in connection with disparate severance pay is a cognizable claim under Title VII.
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.
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 September 4, 2018, the 7th Circuit affirmed an order of summary judgment in a lawsuit filed by an assistant professor against a state university, in which the professor alleged that the University denied him tenure because of his race, African-American, in violation of Title VII of the Civil Rights Act of 1964, as amended ("Title VII") and Section 1981 of the Civil Rights Act of 1866 ("Section 1981"). Haynes v. Indiana University, No. 17-2890 (7th Cir. 9/4/2018). The plaintiff was employed as an assistant professor in the Department of Education at Indiana University. At the conclusion of his six-year probationary employment contract, he was denied tenure. The 7th Circuit held that the record does not support an inference that the University denied tenure because of the plaintiff's race.
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.