Ohio Supreme Court holds that an employer's lawsuit against an employee who has engaged in protected activity is not per se retaliation

This morning, the Ohio Supreme Court issued a significant retaliation decision, Greer-Burger v. Temesi, which holds that "an employer is not barred from filing a well-grounded, objectively based action against an employee who has engaged in protected activity." In so ruling, the Court stated that it is balancing "the statutory right of an employee to seek redress for claims of discrimination without retaliation against the constitutional right of an employer to petition courts for redress."

The facts of the case are as follows. In 1998, Tammy Greer-Burger filed a sexual harassment suit against Lazlow Temesi. The case proceeded to trial, at which Temesi prevailed. Thereafter, Temesi filed suit against Greer-Burger seeking to recover the $42,334 in attorneys fees and costs he had incurred defending against the harassment suit, plus compensatory and punitive damages. In response to Tamesi's lawsuit, Greer-Burger filed a charge of discrimination with the OCRC, claiming that Temesi's lawsuit was retaliation for her protected conduct, the prior sexual harassment suit. Based solely on the fact that Temesi had filed suit, the OCRC found that Tamesi's lawsuit was prohibited retaliatory conduct, and ordered Temesi to immediately cease and desist from pursuing his lawsuit and to pay Greer-Burger the $16,000 she claimed to have expended in defending against it. The common please court and appellate court both affirmed the OCRC's decision.

In reversing the lower courts, the Supreme Court started and ended its analysis with the First Amendment's fundamental right to petition and seek redress in the courts. Despite the fundamental nature of that right, the Court recognized that the right to access courts is not absolute. The First Amendment does not protect "sham" litigation, that is, an objectively baseless lawsuit such that no reasonable litigant could expect success on the merits. To find that the mere act of filing a lawsuit is per se retaliatory, in the words of the Supreme Court, would "undermine the right to petition for redress by giving an administrative agency the power to punish a reasonably based suit filed in court whenever it concludes ... that the complainant had one motive rather than another.... This danger is further highlighted when the only evidence of the complainant's retaliatory motive is the simple act of filing a lawsuit." (internal quotations and citations omitted).

Because of the McDonnell Douglas burden shifting analysis used in retaliation cases, the Court placed the burden on the employer to demonstrate, as its legitimate non-retaliatory reason, that an alleged retaliatory lawsuit is not objectively baseless:

Instead, we find it more prudent to permit an employer the opportunity to demonstrate that the suit is not objectively baseless. In determining whether the employer’s action has an objective basis, the OCRC administrative law judge should review the employer's lawsuit pursuant to the standard for rendering summary judgment.... Thus, an employer needs to show his lawsuit raises genuine issues of material fact. If the employer satisfies this standard, the suit does not fall under the definition of sham litigation. The suit, therefore, shall proceed in court while the proceedings before the OCRC shall be stayed. The procedure outlined above falls within the jurisdiction of the OCRC as provided for in R.C. 4112.04 and promotes judicial economy because the employer's lawsuit will not have to be fully litigated in the trial court before the OCRC can make its determination as to the reasonableness of the suit. In this way, the OCRC essentially shall vet the action to ensure it is not sham litigation. (internal quotations and citations omitted)

The majority opinion concluded by recognizing the stigma of being falsely accused as a discriminator, and the importance of being able to seek legal redress to remedy that misclassification:

An employee's right to pursue a discrimination claim without fear of reprisal is a laudable goal entitled to considerable weight. The OCRC's position in this case, however, has the potential to give employees a carte blanche right to file malicious, defamatory, and otherwise false claims. As the concurring opinion of the appellate court astutely noted, the per se standard advocated by the OCRC does not advance the goal of Chapter 4112 when it "permits a claimant to engage in any kind of slander or defamation, and possibly even perjury, without consequence," and then precludes "those falsely accused of being discriminators from seeking legal redress." Greer-Burger, 2006-Ohio-3690, ¶ 38 (Corrigan, J., concurring).

Just because employees do not have carte blanche right to file malicious, defamatory, or otherwise false claims, does not mean that employers should rush into court to clear their names. Instead, employers should be wary in using Greer-Burger v. Temesi as carte blanche for filing lawsuits against unsuccessful discrimination plaintiffs. As the concurring opinion correctly points out, "the majority's 'not objectively baseless' test sets a very low threshold...." Merely because this case gives companies the apparent right to file a claim does not mean ultimate success on that claim. Indeed, the decision whether to pursue a claim against an employee or ex-employee who has brought a discrimination claim must be carefully thought out, and not merely filed as a knee-jerk reaction to being sued.

Should companies move their employment work to small and mid-sized law firms?

Last week, the Legal Intelligencer, as posted on Law.com, reported on the filing of a legal malpractice lawsuit by a nonprofit agency, the The Bair Foundation, against one of the world's largest law firms, Reed Smith. Now, you may ask yourself, why would the Ohio Employer's Law Blog care about a legal malpractice lawsuit filed in suburban Pittsburgh. The answer comes in two parts: 1) the underlying case was a religious discrimination case that was tried in federal court in Cleveland and resulted a nearly $200,000 jury verdict, and 2) the Bair foundation was charged $960,409 to defend the garden-variety discrimination case. According to the Law.com article:

The foundation said in the complaint that it was originally told the case would cost them $50,000. That was then upped to $112,000 during the case....

"In implementing its ambitious strategy of capturing global clients, which Reed Smith boasts results in 'a constant increase in revenue per partner,' it has acknowledged that comparatively small regional or local law firms can or perhaps should service smaller clients," the complaint stated. "This is so because such firms typically charge much lower fees than 'white shoe' international law firms like Reed Smith and are therefore more affordable to these smaller clients. However, Reed Smith has inexplicably continued to represent certain much smaller clients which lack substantial financial resources, such as Bair, a not-for-profit charitable foundation."

The foundation's [current] attorney, Bruce C. Fox of Obermayer Rebmann Maxwell & Hippel in Pittsburgh, said no explanation was ever given as to why the fees increased to nearly $1 million. He said his client was "badly taken advantage of."

Fox said he doesn't think large, international firms should represent clients like the Bair Foundation because of global law firms' economic models.

The lawsuit alleges inappropriate billing practices, including over-staffing the case, failing to adequately describe billing entries by subject matter or activity, and raising billing rates without notice.

The Bair Foundation's predicament illustrates two key trends to watch in the legal profession for 2008, as discussed in Robert Denney Associates' 19^th Annual Report on What’s Hot and What's Not in the Legal Profession (hat tip to Tom Kane at The Legal Marketing Blog): Labor and Employment continues to be a hot practice area, and mid-size firms are thriving by "attracting clients faced with the high rates – and often poor service – of the large firms." KJK has 31 lawyers, so I have a stake in this discussion. That stake, however, does not change the fact that the small and mid-size firms have as much to offer, if not more, than the large institutional firms. It's not just a question of hourly rates, but also more economical staffing, increased efficiency, and better client communication, all with the same or better quality of legal work. My hope is that these issues cause companies of all sizes to consider small and mid-sized law firms the next time they are sued in an employment case.

Supreme Court grants cert petition in Huber v. Wal-Mart Stores

Huber v. Wal-Mart Stores poses the following question: if an employer has an established policy to fill vacant job positions with the most qualified applicant, is that employer nevertheless required to reassign a qualified disabled employee to a vacant position even if that disabled employee is not the most qualified person for the job. The Supreme Court has agreed to review the decision of the 8th Circuit, which answered that question in the negative.

Pam Huber worked for Wal-Mart as a dry grocery order filler, earning $13 per hour. A permanent injury to her arm and hand left her unable to perform the essential functions of her job. As a reasonable accommodation for her disability, Huber asked that Wal-Mart reassign her to a vacant and equivalent position. Instead of agreeing to reassignment as the reasonable accomodation, Wal-Mart told Huber that she could apply and compete for the position. Huber ended up not being the most qualified applicant. Wal-Mart hired someone else for the job, and placed Huber in a janitorial position that paid her less than half of what she made before her injury.

Huber filed suit under the ADA, claiming that she should have been reassigned to the open position as a reasonable accommodation. Wal-Mart defended on the ground that it had a legitimate non-discriminatory policy of hiring the most qualified applicant for all job vacancies and was not required to violate that policy to accommodate Huber's disability. In a very rare instance, the trial court granted summary judgment in Huber's favor, which the 8th Circuit reversed.

The 8th Circuit's analysis starts with the general principle that reassignment to a vacant position generally qualifies as a reasonable accommodation under the ADA. According to the 8th Circuit, however, the ADA is not a mandatory preference act, and it should not violate the ADA for an employer to make a legitimate non-discriminatory decision to hire the most qualified candidate, even if it results in a disadvantage to a disabled employee. Also, the ADA does not entitle a disabled employee to his or her preferred accommodation, only a reasonable accommodation. Thus, the 8th Circuit concluded: "The ADA does not require Wal-Mart to turn away a superior applicant for the router position in order to give the position to Huber. To conclude otherwise is affirmative action with a vengeance. That is giving a job to someone solely on the basis of his status a member of a protected class." (internal quotations omitted).

It is unclear in the 6th Circuit how this case would have come out, and there are courts (such as the 10th Circuit) that differ and hold that the ADA requires employers to automatically award an open position to a qualified disabled employee if even better qualified applicant are available and despite an employer's policy to hire the best person for the job.

A ruling for the employee in this case would undermine one of the most important commandments of employment law - Thou shalt hire the most qualified person for all open positions. When you don't hire the best person, it could lead a court to second-guess your judgment and question why a member of a protected class was overlooked in favor of the second/third/fourth/whatever best person. Which illustrates another important principle of employment law - when you're explaining, you're losing.

Has the time come for a workplace porn audit?

Last week I wrote about the importance of monitoring workplace technology in the context of a Second Circuit case, which held that the mere presence of pornography in the workplace can be enough to create an objectively hostile work environment (Computer awareness should be important part of harassment policies and training). This lesson hits a little closer to home today, as the Cuyahoga County Court of Appeals has reversed a trial court's grant of summary judgment in a sexual harassment case. In Johnson v. Olmsted Township, the plaintiff, a female police department employee, claimed that a male co-worker had once shown her a pornographic magazine and had once comments about her putting her legs behind her head. Based on those two isolated incidents, the appellate court found that a jury question existed on the severity or pervasiveness of the alleged conduct:

A single act of sexual harassment may be sufficient to create a hostile work environment if it is such a nature and occurs in such circumstances that it may reasonably be said to characterize the atmosphere in which a plaintiff must work. David subjected Johnson to the pornographic magazine in the company of other male officers. The episode a few months later where Davis commented on his perception of Johnson's agility was also made in the presence of male coworkers. The presence of male coworkers makes Davis' act humiliating, which can be considered severe.

If an appellate court is going find two isolated incidents sufficient to hold a jury trial in a harassment claim, perhaps companies have to rethink internal initiatives to head off lawsuits involving porn in the workplace. The headline may be tongue-in-cheek, but the message is real - courts will be more prone to give employers a pass in cases where they acted proactively in trying to rid the workplace of porn than where they stuck their heads in the sand and failed to sanitize the environment.

What else I'm reading this week #8

The Evil HR Lady has had a busy week:

Internal Policy, on whether a company has an obligation to rehire a former employee.

Dress Codes, giving some advice on workplace dress codes and how to address violations.

Pregnancy, also from the Evil HR Lady, on when is the best time for a pregnant employee to disclose the fact of her pregnancy.

While we're on the topic of pregnancy/leaves of absence, take a look atTaking Time Off From Work Without Fearing a Pink Slip, from the Wall Street Journal's CareerJournal.com, on the general legal issues surrounding medical leaves.

New report claims workplace bills would kill jobs, from WorkplaceHorizons.com, on a report by Congressional Republicans detailing how the recent rash of Democratic employment legislation will end up costing people jobs.

Inclement Weather Policies: Don't Get Lost in the Storm, from the Pennsylvania Employment Law Blog, discussing inclement weather policies.

Age Discrimination Releases and Remedies from Suits in the Workplace, reporting on two recent federal court decision dealing with the enforceability of age discrimination releases under the Older Workers Benefit Protection Act.

Finally, How to Get Recruiters To Sign a Contract NOT To Poach Your Employees, from The HR Capitalist, on the wisdom of no-poaching agreements.

Don Imus case illustrates the difficulty of dealing with language in the workplace

There's been a lot of ink spilled this week in both the print media and the blogosphere about the return of Don Imus to the airwaves. (See Who’s the language police for Don Imus? and Imus Is Back, Chastened but Still Proudly Obnoxious). Recall that CBS Radio and MSNBC fired Imus in April after a firestorm erupted from his calling Rutgers women's basketball players "nappy-headed hos." In a post on The Word on Employment Law, John Phillips suggests most HR professionals and employment lawyers would agree with Imus's termination, and that often such comments by senior management and executives are overlooked because "money talks." That argument ignores CBS's hypocrisy in firing Imus over the type of statement that made him such a valuable commodity in the first place. Imus's popularity, and his ability to make millions of dollars for his employers, stems from his controversial nature and his propensity to make comments such as "nappy-headed hos." In fact, he has said much worse over the years, and, once he feels safe in his new job, will probably do so again. That is why he has a job in the first place.

It's difficult to draw any generalized employment law lessons from the Don Imus case because his case is so unique, just as it is difficult to draw any lessons on collective bargaining from the Writers Guild strike. Suffice it to say that language in contextual - it always has been and it always will be. In most contexts and most workplaces, "nappy-headed hos" should not be tolerated, and should result in an investigation, appropriate discipline, and some diversity and sensitivity training. These obligations exist whether an employee complains or not, as supervisors and managers have an affirmative duty to stamp out offensive conduct and the use of offensive language when they come across it or learn of it. The best lesson to draw is simply that companies act at their own peril by condoning or ignoring the use of offensive language in the workplace.

Binghamton University considers adding a law school

You may wonder why a lawyer in Cleveland, Ohio, would care if Binghamton University (nee, the State University of New York at Binghamton) is thinking about opening a law school. I happened to have spent my formative years studying (and other things) in the gray, snowy hills of the Southern Tier. Comments to this news on the Wall Street Journal's Law Blog are not very positive, and repeatedly question whether there is a need for another law school. Let me suggest that BU has an opportunity to think outside the box and try something different with legal education in this country. Whether it's less of a focus on the Socratic method and more on practical lawyering skills, problem solving, and case studies, integrating actual legal practice into the required curriculum through a clinical and internship program integrated with the community, or something else entirely, Binghamton can set itself apart by starting from scratch with a new kind of legal education that gives students an alternative. I'm proud to be a Binghamton alum, and I am proud that it is thinking about branching out into my chosen profession. I hope it continues to make me proud by creating a first rate legal institution. Qualifying for March Madness this year would be nice too.