Investigating and responding to Employment Retaliation Claims!

Investigating and responding to allegations of retaliation by employees or former employees often makes managers, supervisors and officers angry, frustrated or upset.  However, these natural and human feelings about a potentially false retaliation claim can be used against employers in a retaliation lawsuit. 

A manager’s hurt feelings, anger, upset demeanor, unhappiness or defensiveness can be used as evidence of retaliatory animus.  See. Woods v. Washtenaw Hills Manor Inc., Case No. 07-cv-15420, 2009 U.S. Dist. Lexis 22358, *47 (E.D. Mich. 2009); Anderson v. Royal Crest Dairy Inc., 281 F. Supp. 2d 1242, 1250 (D. Colo. 2003); Kinzel v. Discovery Drilling, Inc., 93 P.3d 427, 436 (Ak. 2004); Miller v. National Life Insurance Co., Case No. 00364, 2009 U.S. Dist. Lexis 10626, *27 (D. Conn. 2009). 

Making sure that officers, managers, supervisors, and employees are trained and properly investigating claims of retaliation is crucial in avoiding liability for employers.  At the same time, mechanical or uncompassionate reactions often make the employer less credible during EEOC or IDHR investigations, or a lawsuit. 

Understanding the tightrope that employers have to walk in this regard can be the difference between winning or losing a dispositive motion or a trial.  If you have any concerns or questions about implementing a proper training procedure or defending against retaliation claims, then feel free to contact us. 

Motions to Dismiss and the new Plausibility Standard under Rule 8!

The Supreme Court extended and changed the requirements for pleading a cause of action under Rule 8.  In Twombly, the Court first applied the plausibility standard to a claim for antitrust violations by telecommunications providers.  The Court, stated merely reciting that the telecommunications providers had entered into a contract, combination or conspiracy to prevent competition was insufficient to make the Plaintiffs’ claim plausible. 

In Ashcroft, the Court applied the plausibility standard to a Plaintiff’s complaint of discriminatory treatment of detainees by the Immigration and Naturalization Officers.  The Court stated that merely asserting conclusory allegations that Ashcroft was the principal architect of invidious discrimination and that Mueller was instrumental in adopting the policy was insufficient to meet the plausibility standard.

The Court went to on to reiterate that we must still accept all well plead allegations as true, but essentially, stated that we are not required to accept legal conclusory allegations, unless there are facts that turn the conceivable into the plausible.  However you interpret Twombly or Ashcroft, it is clear that a Defendant’s motion to dismiss in Federal court has greater teeth and district court judges are now empowered to dispose of claims they find incredible. 

It also seems that the plausibility standard is not limited to Antitrust complaints. 

See.  Ashcroft

Tricky Settlement Agreements in Seventh Circuit…

If you are a litigator in Illinois, the Seventh Circuit decisions in Lynch, Shapo, and Blue Cross have just made your job a lot more difficult.  Especially, if your practice involves business, employment or intellectual property matters, where settlement agreements often contain a payment plan for royalties, profits, backpay or future earnings. 

It used to be that based on Kokkonen you could simply enter a dismissal order with prejudice that allowed the court to retain jurisdiction to enforce the settlement agreement.  However, based on the 7th Circuit’s recent rulings in Lynch, Shapo, and Blue Cross entering such an order will deprive the court of jurisdiction to enforce the settlement agreement. 

In which case, your client may be standing outside the courtroom trying to find a way back in by filing a new lawsuit for a breach of contract.  The other common alternative is to enter a dismissal order without prejudice to allow the court to retain jurisdiction to enforce the settlement agreement. 

Unfortunately, entering such an order may deprive your client of the res judicata effect of a dismissal order that is with prejudice.  In this scenario, your client will be back in the courtroom defending against claims that it believed were resolved, and may have helped fund its opponent’s lawsuit. 

Understanding how the drafting of settlement agreements has changed in light of the US Supreme Court’s decision in Kokkonen and the Seventh Circuit’s decisions in Lynch, Shapo, and Blue Cross is crucial to properly representing your client’s interests. 

Kokkonen_1

Lynch_1

Shapo_1

Blue Cross_1

Employment Related Torts-Assault, Battery, IIED, and False Imprisonment!

Often times, employers and employees do not realize that there are common law torts associated with many forms of sexual harassment.  If sexual harassment involved some form of touching or locking up of an employee in an employer facility, then the employer may be liable for common law torts, as well as, sexual harassment. 

It used to be that the Illinois Human Rights Act (“IHRA”) pre-empted many of these common law torts; however, due to recent changes in the law these common law claims are now permitted.   However, the common law torts must not be inextricably linked to the sexual harassment claim.  A common law tort claim that is inextricably linked is still pre-empted by the IHRA.  Johnson v. Chicago Board of Ed., 2002 WL 1769976 *5-7, (N.D. Ill.) and Quantock v. Shared Marketing Services Inc., 312 F.3d 899, 904-06 (7th Cir. 2002). 

In addition, these common law tort claims are still subject to traditional common law defenses, such as the following: laches, statutes of limitations, consent, etc.  In fact, voluntarily entering a room with the harasser can be the basis of a strong consent defense for an employer.  Hanna v. Marshall Field & Co., 279 Ill. App.3d 784 (1st Dist. 1996) (affirming a trial courts dismissal of a false imprisonment claim based on the consent defense pursuant to the employer’s summary judgment motion). 

Of course, this can vary based on the gravity of the sexual harassment from touching hair or genitalia, use of threats, weapons and/or physical violence.  Understanding these employment related torts requires a careful review of current court opinions on these matters.  If you have any concerns or questions relating to these matters, then please feel free to contact us. 

See: Quantock_IIED_Preemption

Attorneys’ fee awards, Prevailing Parties and Reasonable Fee Awards!

Attorneys’ fees are often a huge point of contention in a lawsuit, especially, in consumer and employment law areas.  Often fee shifting provisions are utilized to negotiate concessions from opposing parties.  However, understanding how fee petitions are awarded by courts is crucial to litigating these disputes, advising business owners, individuals, employers, employees, collection agencies and consumers. 

A court will look at the following factors: 1) the nature of the law and the expertise required; 2) the local rates of attorneys specializing in that area of law; 3) the use of multiple attorneys; 3) the complexity of the task performed by the billing attorneys; 4) the amount of recovery obtained for the client; 5) the efficient use of paralegals or administrative staff; 6) the number of conferences and attorney meetings; and 7) the length of the litigation. 

In a recent opinion, the 7th Circuit, affirmed a district courts award of $6500 in fees, based on the following findings: 1) four attorneys were used, when one attorney with a billing $260 could have performed the work; 2) duplicative tasks were performed by attorneys with a billing rate of $425 and $375; 3) the lawsuit was resolved in a matter of months; 4) $6500 seemed roughly proportional to the amount recovered for the Plaintiffs under the Fair Debt Collections Practices Act (FDCPA); and 5) the courts determination that the proffered evidence did not justify the billing rates claims by Plaintiffs’ attorneys. 

See:  Fee_7th_Schlacher_0809.  If you have any concerns or questions regarding the attorneys’ fee matters, then please feel free to contact us.

Continuation of Health Insurance Coverage in IL?

Continuation of Health Insurance Coverage by IL  may seem unnecessary, but it is required under Illinois Continuation laws.  The Illinois Continuation laws apply to employers or companies of any size and provides for the following:

1) spousal and dependent continuation of health insurance coverage;

2) written notice to the employee of his or her right to elect Illinois Continuation Health Coverage;

3) the employee bears a 100% of the premiums costs for electing the coverage;

4) the employee must elect the coverage within 60 days of the date his or her employment was terminated;

5) benefits for hospital, surgical or major medical are the same as that under the previous group coverage; and

6) the Illinois Continuation coverage lasts for nine months from the date of termination or separation of employment. 

If you have any questions regarding the requirements for Continuation of Health Insurance Coverage in IL, then please feel free to contact us.

When is an Employer required to provide a Reasonable Accommodation to disabled employees?

In the legal world, a Reasonable Accommodation is not a stay at a five star hotel or resort.  Instead these terms, refer to the balance that courts attempt to strike between a disabled employee’s rights and an employer’s duty to accommodate the employee. 

Typically, the employer or Company does not have to provide a Reasonable Accommodation under the American’s with Disabilities Act (ADA), unless the employee asks for the accommodation or the employer knows of the disability.  Hedberg v. Indiana Bell Tel. Co. Inc., 47 F.3d 928, 934 (7th Cir. 1995).  

In order for the employer’s obligation to accommodate to be triggered, without the employee’s request, the symptoms of the disability must be obvious enough to reasonably infer that the employer actually knew about the disability.  Hedberg,  47 F.3d 928, 934 (7th Cir. 1995) and Jovanovic v. In-Sink-Erator Div. of Emerson Elec. Co., 201 F.3d 894, 899 (7th Cir. 2000). 

However, this inquiry is often very fact specific, and courts will make a case by case determination about whether or not the employer or Company, had a duty to provide a Reasonable Accommodation to its disabled employees.   

Hedberg  and Jovanovic

A new test for determining Employee v. Independent Contractor Status?

A recent DC Appellate Circuit Court decision may create a new twist on the factors used to determine whether or not an individual is an employee or an independent contractor.  The DC Circuit Court of Appeals recently focused on the degree to which FedEx delivery drivers had the “opportunity and functioned as an entrepreneur”, instead of the traditional focus on the “right to control.” 

Although this decision involved classification of individuals for purposes of determining their rights to bargain as a Union with FedEx, the test and factors discussed are the common law factors used by courts to determine the employment status of an individual. 

The new standard resulted in FedEx delivery drivers being classified as independent contractors.  The DC court also focused on the following: 1) the drivers had their own vehicles; 2) the drivers could use the vehicles for personal or other commercial purposes; 3) the drivers were not subject to disciplinary actions; 4) the drivers signed independent contractor agreements; and 5) the drivers were responsible for the costs of operating and maintaining their vehicles. 

Of course, it is not clear if IL courts will follow this line of reasoning, but it does provide another way for business owners, entrepreneurs and companies to structure relationships with individuals and justify the classification.  Also, individuals need to be aware of the ruling to recognize the potential for greater enforceability of such an independent contractor agreement; otherwise, individuals may be unable to get out of such an arrangement.    

See. FedEx Home Delivery v. NLRB, 07-1931 (D.C. Cir. Apr. 21, 2009). 

Website Immunity for Defamation under the CDA!

The Communications Decency Act (CDA) of 1996, is still alive and protects many internet service providers (ISPs) and website hosts from liability for statements and actions made by others using their services.  The goal is to promote the free exchange of information and ideas over the internet.

Many individuals have received information or posts from individuals that defame or paint them in a bad light.  Sometimes there is false or misleading information that is posted on a website are the basis of tort, contract and intellectual property claims against the ISP or website host. 

The CDA shields these individuals from liability, because they are not considered the speaker.  Moreover, they are shielded from liability if they act in good faith and restrict access to false or misleading information.   Most of the cases dealing with these issues have been in the defamation context, but there is some crossover with contract and intellectual property matters. 

The ISP and the website host is immune as long as they are not the author or creator of the post or statement.  In other words, they are just a means of commnication.  It remains to be seen how the CDA, particularly, section 230, will be interpreted in the context of an breach of contract or violation of intellectual property rights claims.

Employment Discrimination Damages: Back pay, Front pay, and Lost Future Earnings.

Many employers and employees do not understand the types of damages or remedies that are available for employment discrimination claims (“ED claims”).  ED claims are different from ordinary contract or tort claims in that they do not provide the typical compensatory damages. 

For example, under the Age Discrimination in Employment Act (ADEA), compensatory damages are not available, unless there is a retaliation claim.  Pfeifer v. Essex Wire Corp., 682 F.2d 684, 685-688 (7th Cir. 1982) and Moskowitz v. Trustees of Purdue Univ., 5 F.3d 279, 283-84, (7th Cir. 1993).  However, under Title VII of the Civil Rights Act of 1964, employees that are able to establish discrimination based on race, religion, national origin, sexual orientation, or sexual harassment may recover compensatory damages in the form of back pay, front pay and lost future earnings.  Pals v. Schpel Buick & GMC Truck, Inc., 220 F.3d 495, 499-501, (7th Cir. 2000) and Hildenbrandt v. Illinois Dep’t of Natural Resources, 347 F.3d 1014, 1031 (7th Cir. 2003). 

However, back pay, front pay and lost future earnings are equitable remedies that are determined by a judge, instead of a jury.  Pals, 220 F.3d 495, 499-501, (7th Cir. 2000) and Hildenbrandt, 347 F.3d 1014, 1031 (7th Cir. 2003).  Moreover, front pay and lost future earnings are different, because lost future earnings compensate employees for diminishment in future earnings based on an injury to their reputation instead of future salary or wages they could have obtained from the discriminatory employer.  Williams v. Pharmacia Inc., 137 F.3d 944, 953-54, (7th Cir. 1998). 

In addition, there are caps on damage awards and employees have a duty to mitigate their damages.  Understanding the types of remedies and how they are awarded is crucial to litigating and negotiating ED claims.  If you have any concerns or questions regarding litigating or negotiating employment ED claims, then please feel free to contact us.

See Attached Cases: hildenbrandt; pals; and pfieffer.