Category: Civil Rights

Search Warrant Basics

Recently The National Law Review published an article from Risk Management Magazine a publication of the Risk and Insurance Management Society, Inc. (RIMS) regarding Search Warrants in the Office:

When armed government agents enter your office, seize your computers and talk to your employees, the business day has gotten off to a rough start. It only gets worse when the news shows video of agents in raid jackets carrying your eye-catching, focus group-tested logo. As the days go on, you are busy reassuring customers, vendors and employees that despite early reports and comments made by the government and your competitors, it is all going to be fine and you are going to get back to business as usual.

Presented with this hypothetical situation, many adopt a similar response: it won’t happen to me. But any business that operates in a heavily regulated area or partners with any federal agency needs to appreciate that government inquiries are simply part of operating in that space. The FBI is not the only investigative agency; it is just as likely that the Environmental Protection Agency or the Health and Human Services Office of the Inspector General will be at the front desk with a warrant in hand and a team ready to cart away the infrastructure and knowledge of your business. Will you be ready?

Good planning as part of a regular annual review can help settle nerves, avoid costly mistakes, and put you in the best defensive position should that fateful day come when the feds show up at your door. Follow this five-part plan and you will be much better off.

Summon the Team

Just as the agents did the morning before the search, you need to assemble your response team. The government has specialized people with individual roles and you need to have the same type of team. Some people on your team are there because you want them there. Others make the team because they sit at the reception desk or close to the front door. Either way, they are now on the same team.

The point person on the team has to be the in-house counsel. The agent may not let the receptionist place a series of calls, but the receptionist should be permitted to call the in-house counsel to notify her of the situation. From that point on, the command center shifts from the front desk to counsel’s desk.

The next call should be made from the company’s general counsel to outside criminal counsel. A general litigation or M&A background may be well suited for the company’s general needs, but on this day, the needs are quite different. Outside criminal counsel needs to begin the dialogue with the agent and the prosecutor, and should send someone to the scene if possible.

The response team should also include the heads of IT, security and communications. The IT officer must make sure that, as the search is conducted, intrusion into the system can be minimized so that the business may continue operation. If the IT officer is not permitted to assist with the search, it is critical that he observes all actions taken by the government related to any IT matters. This observation may be valuable at some point in the future if computer records are compromised or lost. This is just as important for information that may tend to show some violation of the law as it is for information that may support defense or a claim of actual innocence. The Computer Crime and Intellectual Property Section of the Criminal Division has produced a manual for the search and seizure of computer records and an expert can help evaluate law enforcement’s compliance with its own approved procedures.

If your company is a manufacturer or scientific production company where the question at issue may be the quality, characteristics or integrity of a product, it is important that you demand an equal sample from the same source and under the same conditions as those taken by the seizing agents. This is important so that your own experts can review a similar sample for your own testing in defense. If this is not possible given the type of product seized, your outside counsel will work with prosecutors and agents to assert your rights to preserve evidence for future testing. Just as the IT expert can be a helpful observer, a technical expert who observes the government sampling can also provide valuable insight into issues related to the sampling that may make a world of difference at some time in the future.

The communications expert is the final member of the team, but no less significant. She can be an important point of contact for media inquiries that will inevitably follow. It is vital to be able to communicate to your customers that you are still performing your daily support and that, as you address this matter, you will never take your eye off the customer’s needs and deadlines. With a disciplined response, many companies will survive a search warrant and government investigation. This process will help ensure that your customers are there for you when you get through this difficult time.

Depending on the size of your company, all of the response team roles may be performed by one or two people. Think of the function of the tasks that need to be accomplished instead of job titles alone. The other factor that you must consider at the outset is what role will these people have in the case going forward. Try and identify people who can perform these tasks but will be outside the case itself. If you know that the company lab has been under investigation, the lab director may be a target of the investigation. If that is the case, you do not want to have that employee serving as your only witness observing the search. Instead, an ideal observer might be the outside counsel’s investigator.

Execute a Pre-Established Plan

An important part of this response is that you have a pre-established plan that can be taught and disseminated instantaneously. The first rule of any plan is to not make matters worse. In this case that means, “Let’s not have anyone arrested for obstruction.” If the search team has a signed search warrant for your address, they have a lawful right to make entry.

Challenging the search warrant is for another day and both state and federal laws prohibit interfering with the execution of a search warrant. This is the time to politely object to the search and document what is happening. With a copy of the search warrant in hand, outside legal counsel may be able to challenge the scope of the search, but that is not an area where the novice should dabble.

While your specialized team members perform their tasks, the company is generally at a standstill while the search continues. Let your team members work and have the rest of your employees go home. You are shut down for the time being just as you would be any other time your business is closed. You do not want to allow employees to wander the halls and interact with agents. Off-hand comments that make it into a law enforcement report may distort the facts and be difficult to explain later.

Make sure that company employees understand what is happening and what their rights are in this situation. It is important to avoid interfering with the actual lawful execution of a search warrant; it is also unlawful to tell your employees to not speak to the agents. If they know they have a right to meet with a company-retained counsel of their own and have a right to remain silent at this point, it may go a long way in calming nerves.

Assert Privilege

This is not a difficult matter to explain, but it is critical: if there are documents that are covered by the attorney/client privilege or any other similar privilege, it is critical that you assert that privilege. One reason for the receptionist to be allowed to call company counsel is that there are materials that are covered by the privilege.

It is critical to make privilege claims at this juncture so that the agents are aware of the assertion and that they formally recognize it. This may simply mean that they put those documents in a different box for review by a team subject to judicial review at a time in the near future or it may mean that the team will review the materials for immediate decisions to be made on scene. Whatever procedure the agents have established can be reviewed later, but if you do not assert privilege now, it changes the options available to you as the proceedings go forward

Record the Search

Given the concerns of civil liability, it is not uncommon for agents to make a video recording of their entry and departure from the scene. Their goal is to document any damage that may have been caused by the lawful execution of the warrant. The agents also want to be able to document their professional execution of the warrant in the event that claims are raised at a later point. But that tape is going to stay in their custody and not be available for your team to review as you prepare the defense.

A video record of the search may provide a key piece of support to the defense that could not possibly be understood on the day of the search. However, this process must be handled in a very unassuming manner and with a clear understanding by the agents that you are doing it, and that, in the event there are undercover officers who are masked, that you will make no effort to record them. In some states, recording voice without consent of all parties is a felony, so this is a matter that you must review with outside counsel when you are developing your procedures for search warrant response. Again, you do not want to do anything to make your situation worse.

Collect Your Own Intelligence

Just as the agents are trying to learn about your operations, they will be giving you valuable information about their own operations and the focus of their investigation. Your first tasks are to determine who is in charge, document the names of the agents in attendance and note all the agencies involved in the search. This is information that you can gather directly by politely asking for the names of the agents and observing the insignia of the agents’ uniforms or badges around their necks.

The other opportunity available to you in this unique situation is the opportunity to listen to the language the agents use, the apparent hierarchy of the agents, and the small bits of casual conversation that may give you valuable insight into the goals of the search. As the day wears on, the agents will feel more comfortable around your response team and they will talk more freely. This is not to suggest that your team should attempt to interrogate the agents, however, because that will open a two-way dialogue that may lead to statements that are difficult to explain or put in context. The suggestion is simply that you serve as an active listener.

Help Establish Rapport

Throughout the day, the agents are going to be forming opinions about your company and your employees. Use this time to make a good impression about your company. A professional, disciplined response in a time of crisis sends a very different message than the one sent by yelling obstructionists. Even though the agents have quite a bit of information about you as their target, it may have all been gathered from third parties. This may be your opportunity to impress them and to help them question the veracity of your accusers. Remember that there will be meetings about your company, your executives and their futures, and the only people in those meetings will be the agents and the prosecutors. You want their memories of this day to weigh in your favor.

Risk Management Magazine and Risk Management Monitor. Copyright 2012 Risk and Insurance Management Society, Inc.

Are Bloggers’ Free Speech Rights Under Attack?

The National Law Review recently published an article by Jesse L. Jenike-Godshalk of Dinsmore & Shohl LLP regarding Blogger’s Free Speech:

A recent legal opinion has some concerned about just how broad free speech rights may be for bloggers who are not associated with institutional media, such as newspapers and television stations. In Obsidian Finance Group, LLC v. Cox, No. CV-11-57-HZ, slip op. (D. Or. Nov. 30, 2011), a federal judge ruled that a self-proclaimed “investigative blogger” was not “media” and, therefore, was not entitled to certain First Amendment protections that are reserved for the media.Despite the alarm that this case has generated, it actually is not a major setback for the free speech rights of bloggers.

The Case: Obsidian Finance Group, LLC v. Cox

From late 2010 to early 2011, Crystal Cox made numerous blog posts in which she accused Obsidian Finance, LLC and one of the company’s senior principals, Kevin Padrick, of corrupt, fraudulent, and illegal conduct. Obsidian and Padrick subsequently sued Cox for defamation. Rather than hiring an attorney, Cox chose to defend pro se.

In August 2011, before the case went to trial, the judge granted summary judgment to Cox with regard to all but one of her blog posts, because the posts were statements of opinion protected by the First Amendment. See Obsidian Finance Group, LLC v. Cox, No. CV-11-57-HZ, slip op. (D. Or. Aug. 23, 2011). A statement, such as a blog post, can be the basis for a defamation suit only if the statement is a provable assertion of fact. In contrast, statements of opinion are protected by the First Amendment. According to the judge, blog posts, by their very nature, are usually statements of opinion.

Prior to the trial, the judge still had several issues that he needed to resolve. Among these issues was Cox’s claim that she was “media” and therefore, based on U.S. Supreme Court precedent, the plaintiffs could not recover damages from her for defamation without proof that she was at least negligent in making the allegedly defamatory statements. The judge rejected that Cox was “media,” writing:

Defendant cites no cases indicating that a self-proclaimed “investigative blogger” is considered “media” . . . . Without any . . . authority on the issue, I decline to conclude that defendant in this case is “media” . . . .

Defendant fails to bring forth any evidence suggestive of her status as a journalist. For example, there is no evidence of (1) any education in journalism; (2) any credentials or proof of any affiliation with any recognized news entity; (3) proof of adherence to journalistic standards such as editing, fact-checking, or disclosures of conflicts of interest; (4) keeping notes of conversations and interviews conducted; (5) mutual understanding or agreement of confidentiality between the defendant and his/her sources; (6) creation of an independent product rather than assembling writings and postings of others; or (7) contacting “the other side” to get both sides of a story. Without evidence of this nature, defendant is not “media.”

Obsidian Finance Group, LLC v. Cox, No. CV-11-57-HZ, slip op. at 9 (D. Or. Nov. 30, 2011). Following this ruling, the case went to trial, and the jury found for the plaintiffs, awarding $2.5 million in damages.

Not a Major Setback

Despite the concern that this case has generated, the case is not a major setback for the free speech rights of bloggers, and it can even be regarded as a pro-free speech case. First, some of the judge’s statements suggest that bloggers enjoy expansive First Amendment rights. In his ruling on summary judgment, the judge stated that blog posts, by their very nature, are usually “opinions” and not provable assertions of fact. Such “opinion posts” are protected under the First Amendment and are not actionable as defamation—regardless of whether the writer is “media.”

Second, the judge established a very low bar for what a blogger must do to enjoy the additional free speech protections that are reserved for “media.” To wit, a blogger must present some evidence that he or she is a journalist. Cox lost this issue because she presented no evidence.

The judge provided her with a list of seven types of evidence that she could have offered. This list does not create an exacting standard of proof for a blogger to meet. To be considered “media,” a blogger would not need to offer all seven types of evidence. In fact, a blogger would not necessarily need to offer any of the seven types of evidence. The list is not exhaustive, but is merely “[f]or example.” A blogger must present “evidence of this nature.” Thus, a blogger could prove that he or she is “media” by presenting types of evidence not on the list. In addition, most bloggers probably would be able to present some evidence of the types that are on the list—e.g., “proof of editing,” “keeping notes of conversations,” or “creation of an independent product rather than assembling writings and postings of others.”

Had Cox hired an attorney, the attorney almost surely would have been able to offer some evidence that Cox was “media.” Actually, had Cox hired an attorney, she might have won the entire case on summary judgment—and she would have entirely avoided the issue of whether she was “media.” Herein lies the real lesson from this case: If you are sued for defamation, get yourself an attorney.

© 2012 Dinsmore & Shohl LLP.

High Court: Police Tracking of Suspect Via GPS Requires Warrant

Recently found in The National Law Review an article by Rachel Hirsch of Ifrah Law regarding a recent High Court Decision Requiring a Warrant:

Last November, we discussed the U.S. Supreme Court’s oral argument in United States v. Jones, which posed the question of whether police need to obtain a warrant before attaching a GPS device to a suspect’s vehicle during a criminal investigation.

We noted that in this case, 21st-century technology had come face to face with the constitutional requirements of the Fourth Amendment. We were hoping that the high court would uphold the U.S. Court of Appeals for the D.C. Circuit and hold that this action is a search that requires a warrant, but we took a pass on predicting what the Court would actually do.

On January 23, 2012, the Court decided the case – unanimously against the government and in favor of defendant Antoine Jones. The decision is fairly gratifying for those of us who believe it desirable to curb prosecutors’ power by imposing restrictions upon it, including, where appropriate, the requirement of a judge-issued warrant.

It turns out that both the advocates of the original-intent approach to constitutional interpretation, epitomized here and in general by Justice Antonin Scalia, and those who prefer the doctrine of the “living Constitution,” led here by Justice Samuel Alito, agree that the use of a GPS device by the government constitutes a search and requires a warrant.

Scalia, writing for a majority of the Justices, observed that prosecutors had intruded upon Jones’ property in way that would have been a “trespass” under common law.

Prosecutors “physically occupied private property for the purpose of obtaining information,” Scalia wrote. “We have no doubt that such a physical intrusion would have been considered a ‘search’ within the meaning of the Fourth Amendment when it was adopted.” And for Scalia, that fact alone was enough to decide the case.

Alito, joined by three Justices who concurred in the result, used quite a different line of reasoning and sharply criticized Scalia’s majority opinion, saying that ironically, it relied upon 18th-century tort law to decide a case involving 21st-century technology.

“This holding, in my judgment, is unwise,” Alito wrote. “It strains the language of the Fourth Amendment; it has little if any support in current Fourth Amendment case law; and it is highly artificial.”

Instead, Alito wrote, he “would analyze the question presented in this case by asking whether [Jones’] reasonable expectations of privacy were violated by the long-term monitoring of the movements of the vehicle he drove.” Alito observed that for decades, the Court has invoked the concept of “reasonable expectations of privacy” in a number of cases to define the nature of a “search” under the Fourth Amendment and to expand the definition of “search” to actions that do not involve a trespass to someone’s property.

Even though Alito is often identified with the pro-prosecution, conservative wing of the Court, he took the defendant’s side in this case. As our blog post last November noted, at oral argument Alito expressed concern about how easy it is these days “to amass an enormous amount of information about people” by the use of today’s technology.

Alito’s opinion followed similar lines. In the absence of legislation about police use of GPS tracking, he wrote, “The best that we can do in this case is to apply existing Fourth Amendment doctrine and to ask whether the use of GPS tracking in a particular case involved a degree of intrusion that a reasonable person would not have anticipated.”

This is good news for constitutional rights and for defendants. Whatever approach one takes to the Fourth Amendment, it’s clear that prosecutors can’t attach a GPS to a suspect’s car without a warrant.

© 2012 Ifrah PLLC

Allegations of Sexual Harassment and Sexual Violence: What Must a School Do?

Recently posted in the National Law Review  an article by attorney Stephen A. Mendelsohn of Greenberg Traurig, LLP regarding universities examining their policies and procedures concerning the investigation and resolution of sexual harassment and sexual violence allegations:

GT Law

Recent events at major universities should cause schools to critically examine their policies and procedures concerning the investigation and resolution of sexual harassment and sexual violence allegations. This GT Alert examines what an institution must do to limit its potential exposure to lawsuits alleging sexual harassment or sexual violence by students upon students or by faculty or staff upon students.

TITLE IX

All educational institutions that receive federal financial assistance are subject to Title IX of the Education Amendments of 1972 (Title IX), 20 U.S.C. sections 1681et seq. and the United States Department of Education (DOE) implementing regulations, 34 C.F.R. Part 106, which prohibit discrimination on the basis of sex. Sexual harassment, which includes sexual violence, covers student-student, studentstaff/faculty and faculty-faculty conduct. The DOE’s Office of Civil Rights (OCR), on April 4, 2011, published a “Dear Colleague” letter that reiterates a school’s legal obligations to investigate and resolve sexual harassment and sexual violence complaints and warns schools that they must comply with Title IX and DOE, OCR regulations or face DOE sanctions.

A School’s Obligations to Respond to Sexual Harassment and Sexual Violence Complaints

Determining what constitutes sexual harassment and sexual violence is often difficult. Though some instances are seemingly obvious, many cases turn on the issue of consent. Title IX does not prohibit all forms of sexual behavior between consenting adults. Rather, it prohibits sexual acts perpetuated against a person’s will or where a person is incapable of giving consent due to the victim’s abuse of drugs or alcohol. A person may not give consent due to intellectual or other disabilities. Whether proper consent has been given is often a challenging issue.

Where students participate in a school’s education programs and activities, Title IX is applicable. It is also applicable, for example, where student upon student sexual harassment or sexual violence occurs off campus and does not involve school programs or activities.

A school that knows, or reasonably should know, about possible sexual harassment or sexual violence must promptly investigate what may have happened and must also take appropriate steps to resolve the situation. Even if the matter is subject to a law enforcement investigation, the school must conduct its own investigation. If a school has reason to believe that there may have been criminal conduct, the school must immediately notify law enforcement officials.

Schools must also navigate through the Family Educational Rights and Privacy Act (FERPA), 20 U.S.C. section 1232g; 34 C.F.R. 99.15. Though FERPA protects student confidentiality, a school may not withhold the identity of the complainant from the alleged harasser.

Procedural Requirements for Sexual Harassment and Sexual Violence Investigations

Under Title IX, schools must, at a minimum, take three procedural steps in investigating sexual harassment and sexual violence complaints. These include:

  • Disseminating a Notice of Discrimination;
  • Designating at least one employee to serve as a Title IX coordinator;
  • Adopting and publishing grievance procedures for prompt and fair resolution of student and employee sex discrimination complaints.

Whether a school’s Notice of Discrimination complies with Title IX requires the application of the DOE, OCR’s regulations. A Title IX coordinator must have adequate training in Title IX’s policies and procedures.

Title IX requires that grievance procedures be published and that they provide a prompt and fair process. Though the grievance procedures need not be separate from normal student disciplinary procedures, they must include:

  • Notice to students and employees of the procedures and where complaints may be filed;
  • Adequate and impartial investigations carried out by employees where both parties have the right to present witnesses and evidence;
  • Designated and reasonably prompt time frames for the process;
  • Notice to the parties of the outcome;
  • Steps taken to prevent recurrence and correct discriminating effects.

Risk Management

Victims of sexual harassment and sexual violence have the right to seek monetary damages against schools for student upon student and faculty/staff conduct where the school is deliberately indifferent to the victim’s complaints. Davis v. Monroe County Bd. of Ed, 119 S. Ct. 1661(1999). Compliance with Title IX and the DOE, OCR’s regulations, along with a full and fair investigation and grievance process, provides a defense to a lawsuit. In the absence of Title IX and DOE regulatory compliance, or the failure to apply existing school policies and procedures, schools will invite Title IX actions.

A thorough review and assessment of Title IX, DOE, OCR regulations and existing policies and procedures is key to avoiding monetary liability for sexual harassment and sexual violence and in aiding victims.

©2011 Greenberg Traurig, LLP. All rights reserved.

"The Sins of the Father": Third Party Retaliation Claims Allowed to Proceed

Recently posted in the National Law Review an article written by Ralph A. Morris of Schiff Hardin LLP about third-party retaliation claims :

A recent Texas federal court decision has further expanded the bases for Title VII retaliation claims against employers. In Zamora v. City of Houston, Christopher Zamora, a Houston police officer, alleged that the Houston Police Department demoted him in retaliation for the filing of a charge with the U.S. EqualEmployment Opportunity Commission (“EEOC”). In this case, however, the charge was not filed by Christopher Zamora, but by his father, Manuel Zamora, alleging that he, Manuel Zamora, had been discriminated against by the Department.

Earlier this year, in Thompson v. North American Stainless, LP, the United States Supreme Court permitted an employee’s Title VII retaliation claim to proceed where the employee’s fiancee had earlier filed an EEOC charge. The Court held that a Title VII retaliation claim could stand where the employee is subject to an adverse employment action because a co-worker to whom the employee is “closely related” engaged in protected activity.

The Supreme Court decided Thompson while the Zamora case was pending in the U.S. District Court for the Southern District of Texas. After the Thompson decision was issued, the Zamora court reversed its prior determination that dismissed Christopher Zamora’s claim. The court concluded that under Thompson, Mr. Zamora’s retaliation claim could proceed based on his father’s filing of an EEOC charge. Thus, under Zamora, in addition to a fiancee, a parent-child relationship satisfies the “closely related” test enunciated by the Supreme Court in Thompson.

Retaliation charges and lawsuits typically are more challenging to defend because the employee’s burden of proof is not as difficult to meet, as compared with a charge of discrimination. Thompson and Zamora now place an additional burden on employers by holding that employees themselves do not necessarily need to engage in the protected activity to have standing to sue for retaliation. These decisions may have a greater impact on employers that make it a practice to hire family members and friends of existing employees than on those with anti-nepotism policies.

The Supreme Court refrained from identifying a fixed class of relationships for which third-party retaliation claims are viable. Future cases will have to decide how far retaliation claims will be expanded: whether, for example, partners involved in a romantic relationship but who are not engaged, or familial relationships more distant than parent and child, are sufficiently close so as to fall within the zone of protection. Employers can help reduce the risk for these types of claims by reviewing their EEOC and anti-retaliation policies and ensuring that managers are trained and educated on compliance.

© 2011 Schiff Hardin LLP

EEOC and Cracker Barrel Sign National Mediation Agreement

Recently posted in the National Law Review an article by U.S. Equal Employment Opportunity Commission regarding Cracker Barrel Old Country Store signing of a National Universal Agreement to Mediate:

WASHINGTON – Cracker Barrel Old Country Store, Inc. and the U.S. Equal Employment Opportunity Commission (EEOC) today announced the signing of a National Universal Agreement to Mediate (NUAM) to streamline the handling of employment discrimination claims.

With the signing of this agreement, Cracker Barrel joins more than 200 national and regional private sector employers, including several Fortune 500 companies, who have made similar arrangements with the EEOC. This agreement provides the framework for both organizations to informally resolve any workplace issues that may arise from time to time through Alternative Dispute Resolution (ADR) rather than through a traditional lengthy, formal EEOC investigation or potential litigation. The NUAM includes all Cracker Barrel locations.

“Nationwide mediation agreements like this are a classic win-win,” said Nicholas Inzeo, Director of the EEOC’s Office of Field Programs. “NUAMs are a non-adversarial and efficient way for companies to handle discrimination charges using the EEOC as a partner and advisor. EEOC mediation encourages a positive work environment, and the company saves time and money. Everyone benefits. We are gratified that a major employer such as Cracker Barrel has joined the growing ranks of companies that are making use of this innovative system.”

Cracker Barrel Vice President and General Counsel Michael J. Zylstra said, “Cracker Barrel is committed to providing a fully inclusive workplace, where diversity is welcomed and everyone is treated with courtesy and respect. This innovative agreement builds upon our existing policies and procedures to effectively and fairly resolve employee concerns and demonstrates our shared goal to create a bias-free workplace. We look forward to developing an even stronger relationship with the EEOC.”

Under the terms of the NUAM, any eligible charges of discrimination filed with the EEOC in which Cracker Barrel is named as an employer/respondent will be referred to the EEOC’s mediation unit. The company will designate a corporate representative to handle all inquiries and other logistical matters related to potential charges in order to facilitate a prompt scheduling of the matter for EEOC mediation.

Expanding mediation is a key component of the EEOC’s efforts to improve operational efficiency and effectiveness. The EEOC has entered into 233 national and regional Universal Agreements to Mediate (UAMs) with private sector employers, including several Fortune 500 companies. Additionally, EEOC district offices have entered into 1,743 mediation agreements with employers at the local levels within their respective jurisdictions. Since the full implementation of the EEOC’s National Mediation Program in April 1999, more than 136,000 charges of employment discrimination have been mediated, with nearly 70 percent being successfully resolved.

Cracker Barrel Old Country Store, Inc. (Nasdaq: CBRL) was established in 1969 in Lebanon, Tenn., and operates 604 company-owned locations in 42 states. For more information, visit www.crackerbarrel.com.

The EEOC enforces federal laws prohibiting employment discrimination. Further information about the EEOC and its mediation program is available on its web site at www.eeoc.gov.

Second Circuit Finds that Employers May be Obligated to Accommodate a Disabled Employee's Commute

Posted in the National Law Review an article by attorneys James R. Hays, Jonathan Sokolowski and James R. Hays of Sheppard Mullin Richter & Hampton LLP regarding disabled employees and employers requirements to assist them:

 

The Second Circuit Court of Appeals has held that under the Americans with Disabilities Act (“ADA”) and the Rehabilitation Act, employers may be required to assist disabled employees with their commute.

In Nixon-Tinkelman v. N.Y. City Dep’t of Health & Mental Hygiene, No. 10-3317-cv, 2011 U.S. App. LEXIS 16569 (2d Cir. N.Y. Aug. 10, 2011), plaintiff Barbara Nixon-Tinkelman (“Plaintiff”), who has cancer, heart problems, asthma, and is hearing impaired, brought suit under the ADA and the Rehabilitation Act alleging that the New York City Department of Health & Mental Hygiene (“Defendant” or “DOHMH”) failed to reasonably accommodate her disability. Specifically, following her transfer from Queens to Manhattan, Plaintiff requested that DOHMH accommodate her commute by transferring her back to an office location closer to her home in Queens. DOHMH ultimately denied Plaintiff’s request.

The Southern District of New York dismissed Plaintiff’s complaint on Defendant’s motion for summary judgment, finding that activities which “fall outside the scope of the job, like commuting to and from the workplace, are not within the province of an employer’s obligations under the ADA and the Rehabilitation Act.” However, on appeal, the Second Circuit faulted the district court’s holding, explaining that certain circumstances may require an employer to provide commuting assistance to a disabled employee, and furthermore, that providing such assistance is not “inherently unreasonable.” Accordingly, the Second Circuit remanded the case to the district court, and tasked it with engaging in the “fact-specific inquiry” necessary to determine whether it would have been reasonable to provide Plaintiff with a commuting accommodation. On remand, the Second Circuit directed the district court to consider the following factors: (a) Defendant’s total number of employees; (b) the number and location of Defendant’s offices; (c) whether other positions exist for which Plaintiff was qualified; (d) whether Plaintiff could have been transferred to a more convenient office without unduly burdening Defendant’s operations; and (e) the reasonableness of allowing Plaintiff to work from home without on-site supervision.

In addition to the above-listed factors, the Second Circuit also noted that the district court should have contemplated whether transferring Plaintiff “back to Queens or another closer location, allowing her to work from home, or providing a car or parking permit” would have accommodated her needs.

Nixon-Tinkelman serves as a reminder to employers that they must carefully assess all requests for reasonable accommodations from disabled employees. Although employers are not required to provide the specific accommodations employees may request, they must nevertheless work with employees to determine what reasonable accommodations, if any, can be made.

Copyright © 2011, Sheppard Mullin Richter & Hampton LLP.

U.S. Supreme Court Stresses Importance of Commonality in Decertifying Massive Sex Discrimination Class of 1.5 Million Wal-Mart Employees

 Barnes & Thornburg LLP‘s Labor and Employment Law Department recently posted in the National Law Review an article about the U.S. Supreme Court’s reversing the largest employment class certification in history

In Wal-Mart, Inc. v. Dukes, reversing the largest employment class certification in history, the U.S. Supreme Court appears to have limited the circumstances in which federal courts can certify class actions – and not just in employment cases. The Court held that the lower federal courts had erred by certifying a class that included 1.5 million female employees from virtually every part of the country. The plaintiffs sought injunctive and declaratory relief, punitive damages, and backpay as a result of alleged discrimination by Wal-Mart against female employees in violation of Title VII of the Civil Rights Act of 1964. 

The Supreme Court held that class certification was improper because the class failed to meet the “commonality” requirement of Federal Rule 23(a)(3), which provides that a class can be certified “only if…there are questions of law or fact common to the class…” The Court noted that the mere allegation of “common questions” is insufficient under Rule 23. “Th[e] common contention… must be of such a nature that it is capable of classwide resolution – which means that determination of its truth or falsity will resolve an issue that is central to the validity of each one of the [individual class members’] claims in one stroke.” 

The Court held that the Wal-Mart class did not meet the standard for commonality, because the evidence showed that Wal-Mart gave discretion to its supervisors in making employment decisions. The named plaintiffs “have not identified a common mode of exercising discretion that pervades the entire company… In a company of Wal-Mart’s size and geographical scope, it is quite unbelievable that all managers would exercise their discretion in a common way without some common direction.” The Court concluded that, “Because [the named plaintiffs] provide no convincing proof of a company-wide discriminatory pay and promotion policy, we have concluded that they have not established the existence of any common question.”

The lack of commonality found in Wal-Mart can arise in class actions of many kinds. Under Wal-Mart, a question is “common” under Rule 23(a)(3) only if it can be decided on a class-wide basis. In the past, many named plaintiffs, and some lower courts, have overlooked this essential point. And, as in Wal-Mart, in many cases a claim of commonality will fail precisely because there is no way to rule on the question without addressing the individual facts relating to each purported class member. Wal-Mart makes clear that such a lack of commonality is sufficient to defeat class certification.

In addition to meeting all of the requirements of Rule 23(a), a class must comply with one of the three subparts in Rule 23(b). The trial court in Wal-Mart had certified the class under Rule 23(b)(2), which allows a class where the defendant’s alleged conduct “appl[ied] generally to the class, so that final injunctive or declaratory relief is appropriate respecting the class as a whole…”   Another issue before the Supreme Court was whether such certification was proper where the class sought recovery of substantial backpay based on Wal-Mart’s alleged discrimination.

The Court ruled that the purported class could not be certified under Rule 23(b)(2),  holding that “claims for individualized relief (like the backpay at issue here) do not satisfy the Rule.” The Court said that Rule 23(b)(2) “does not authorize class certification when each class member would be entitled to an individualized award of monetary damages.”

Under the analysis in Wal-Mart , in the vast majority of class actions seeking a monetary recovery, the class can be certified (if at all) only under Rule 23(b)(3). Class certification under that provision is often more difficult, because a class plaintiff must prove that common questions “predominate” over individual questions and that a class action is “superior” to individual actions.  In addition, under Rule 23(c)(2)(A), individual notice must be given to all members of a Rule 23(b)(3) class at plaintiff’s expense, while such notice is optional, within the trial court’s discretion, if the class is certified under Rule 23(b)(2).

Wal-Mart is an important case in the area of employment law; but the Supreme Court’s holdings on the requirements of Rule 23 are likely to be helpful in defending class actions of all kinds

© 2011 BARNES & THORNBURG LLP

The Need for a Detailed Procedure of Judicial Review of Civil Rights Arbitration Awards after Rent-A-Center West, Inc. v. Jackson

Congrats to Nicole Farbes-Lyons of St. John’s University School of Law – winner of the National Law Review Spring Student Legal Writing Contest.  Nicole’s topic  explored several components underlying the Supreme Court’s recent Rent-A-Center decision and the subsequent need for clearer guidance per civil rights arbitration.  

Introduction

The November 17, 2010 New York Times article “Justices Are Long on Words but Short on Guidance” blasted the Supreme Court of the United States for its issuance of sweeping and politically polarized decisions, and criticized the quality of the Court’s “judicial craftsmanship” by positing that “[i]n decisions on questions great and small, the Court often provides only limited or ambiguous guidance to lower courts. And it increasingly does so at enormous length.” [1] The article continued that critics of the Court’s work “point to reasoning that fails to provide clear guidance to lower courts,” and described the Court’s recent rulings as “fuzzy” and “unwieldy.”[2]

In the past, the Supreme Court has been notably divided over issues such as abortion and the death penalty. But the “fuzziness” in many recent rulings is owed to an obvious ideological divide in the area of arbitration. Over the past decades, a significant number of controversial decisions have arisen from the considerable attention (and contention) the Supreme Court has given arbitration as it endeavors to counterbalance pro-arbitration rulings and assurances that arbitration does not erode sufficient, constitutionally proscribed judicial control.[3] However, these decisions have been largely criticized as providing, at best, a fuzzy blueprint for lower courts to design more specific rules.

Rent-A-Center v. Jackson [4] is the most controversial, ideologically split arbitration decision of the Supreme Court’s recent term. The central issue arose because Rent-A-Center requires employees to sign a two-part arbitration agreement as a condition of their employment, stipulating first that all disputes arising out of the employment relationship be settled by arbitration, and second, that an arbitrator must settle all challenges to the validity of the arbitration agreement.[5] When plaintiff Jackson, a Rent-A-Center account manager, brought a 42 USC § 1981(a) / 42 USC §§. 2000(e)(2) employment discrimination claim against the company, Rent-A-Center insisted that the claim be resolved through arbitration.[6]

Jackson argued that the arbitration agreement was unconscionable because it denied him meaningful and appropriate access to court for a satisfactory remedy in the exact way prohibited by federal statute. Rent-A-Center argued that this threshold question of whether there was a valid and fair agreement to arbitrate Jackson’s employment grievance was a matter for the arbitrator under the Federal Arbitration Act. Jackson asserted that because the unconscionability challenge went to both parts of the arbitration agreement, arbitrability of the agreement was a question for the court.

By a vote of five to four, the Supreme Court ruled in Rent-A-Center’s favor. Led by Justice Scalia, the Court held that if Jackson had solely questioned the second part of the contract – that the agreement must be arbitrated – then the challenge would have been proper before the court. But because the employee’s grounds for unconscionability applied equally to the agreement to arbitrate all employment disputes, the general question of unconscionability was no longer a “gateway issue” before the court, and was a matter for the arbitrator.[7]

Though it generated very little media attention, the majority decision in Rent-A-Center incited much sideline animosity. Critics of Rent-A-Center argued that the case is incorrectly decided and the latest, deadliest blow to consumers and employees in a trajectory of pro-arbitration rulings that are supplanting the constitutional right to court access with compulsory arbitration. Lawmakers have admonished the Court’s short-sightedness, and Senate Judiciary Committee Chairman Patrick Leahy referred to Rent-A-Center as “a blow to our nation’s civil rights laws”.[8] Throughout the blogosphere, commentators described Rent-A-Center as “audacious,” and, as Justice Stephens described in his dissent, “fantastic”.[9]

In addition to the political arguments arising from Rent-A-Center, critics also raised concerns about procedural challenges facing professional arbitrators in light of the Court’s holding. The recent case law culminating in Rent-A-Center has drawn criticism for its lack of guidance instructing either the courts or arbitrators about their respective roles within civil rights arbitration. Broad principles of arbitration and specific doctrines of the Supreme Court encourage but do not demand that the federal protections of civil rights statutes must be enforced in private arbitration. Though the Supreme Court gives assurance that courts may reject arbitral awards for “manifest disregard,” in regards to statutory protection, the courts do not agree as to whether a showing of manifest disregard is proper grounds for vacating an arbitration award.[10]

This conundrum is disturbing, and the doctrine culminating in Rent-A-Centercreates, at best, a blueprint for potential interpretations of arbitration agreements and judicial remedies for arbitrable disputes. The question left before the legal community is, then, whether the Supreme Court’s next step will be to clarify a specific process for civil rights arbitration. Until then, the courts will likely remain divided over the issue of whether, and under what circumstances, statute-created court access can be circumvented with compulsory arbitration agreements, without violating due process of law.

This paper will explore several components underlying the Rent-A-Centerdecision and the subsequent need for clearer guidance per civil rights arbitration. First, this paper will prepare the background and context of civil rights arbitration by exploring the legislative history and statutory framework of the Federal Arbitration Act (“FAA”) and the Civil Rights Acts, particularly focusing on 42 USC §1981(a) right to recovery under Title VII of the Civil Rights Act of 1964 (“Title VII”). Second, this paper will introduce problems of separability stemming from the Supreme Court’s efforts to increase the preemptive reach of the FAA under a broad definition of interstate commerce. Finally, this paper will assert potential remedies towards ameliorating the ambiguities that culminate in the Rent-A-Center decision, in light of this judicial and legislative history.

I. Background and Context of Civil Rights Arbitration

A. Statutory History of 42 USC § 1981

The civil right at issue in Rent-A-Center was Jackson’s right to protection against racial discrimination under 42 USC § 1981. During the Reconstruction Era, restrictive employment covenants were an acknowledged social evil used by former slave owners to deny freedmen any opportunity to exercise their rights to property and employment.[11] Recognizing the elements that impaired the emancipated slaves’ ability to obtain a fair trial in former Confederate states, Congress observed that, “To say that a man is a freeman and yet is not able to assert and maintain his right in a court of justice is a negation of terms.”[12]

The framers of the Civil Rights Acts had a specific legislative goal of rooting out discrimination. The Reconstruction Congress determined that the Civil Rights Acts would only have force if the statutes also created a clear mechanism of judicial enforcement, and delineated a remedy at law that would ensure all Americans the right to a fair tribunal.[13] Accordingly, this Congress created statutes providing a federal right to action as protecting against discrimination.[14]

The legislative history behind the Reconstruction Era Civil Rights Acts is not antiquated, and the Supreme Court has recognized that, “ameliorating the effects of past racial discrimination [is] a national policy objective of the highest priority.‟[15]A predominant effect of the Civil Rights Acts, particularly 42 USC § 1981(a), is that federal law prohibits discrimination in employment based on race, gender, disability, and sexual orientation. In 1991, the 102nd Congress expanded the provisions of 42 USC § 1981(a) and subsequent law to provide statutory basis for arbitration and alternative dispute resolution to “the extent available by law.”[16]

B. Statutory History of the Federal Arbitration Act

Formal arbitration practices can be dated to the Middle Ages, and many primary themes continue in modern arbitration: greater confidentiality, group amelioration, arbitrators with particularized commercial expertise, less formality than court proceedings, greater expedition, compromise, judgments that are final in merit, and the idea that, optimally, resolution of the dispute allows the parties to maintain favorable business relationships.

Despite this equitable premise, many difficulties hindered arbitration until the 20th century, such as difficulty in enforcing awards and judicial concern over jurisdictional ouster. In 1920, the New York State legislature enacted the first modern arbitration statute, which was followed in 1925 by enactment of the FAA and, subsequently, the advent of arbitrable statutes in most of the states.[17]Core principles of the New York statute were cloned in the FAA, particularly the idea that a pre-dispute agreement compelling arbitration is contractual, and therefore a litigant must assert a valid contract defense such as fraud, duress or unconscionability to prove the agreement is unenforceable.[18]Where a counter party to a pre-dispute agreement brings a case, a party can move to stay the court case by showing the agreement was arbitrable or, if there is general recalcitrance, move to compel arbitration.[19]

C. Common Criticisms of Modern Arbitration

These attributes of modern arbitration have been greatly criticized in the context of statutory arbitration, particularly in respect to Title VII claims.[20] In the legal discussions surrounding Rent-A-Center, Jackson’s supporters argued that he, and similarly situated employees, did not have a choice about whether to sign the Rent-A-Center mandatory pre-dispute arbitration agreement; Jackson had no opportunity to negotiate its terms, and the failure to sign would have precluded employment.[21] Additionally, supporters argued that Jackson should not have been expected to understand that his acceptance of the employment agreement was a waiver of his statutory right to court access.[22] Finally, supporters believed that, even in favorable arbitration circumstances, acceptance of all arbitration terms was likely to favor the employer with respect to fees, discovery, and procedures.[23] However, the Supreme Court has noted many times that these criticisms are not unique to civil rights arbitration but instead are inherent to the very nature of dispute resolution.[24]

The Court of Appeals has noted the issue of enforceability in employment contracts mandating employees’ waiver of court access with respect to all employment disputes relating to discrimination.[25] The court described an arbitrator who resolves statutory claims as a “private judge,” but noted that, unlike a judge, an arbitrator is not publicly accountable and the lack of public accountability may favor companies over individuals.[26] The court also acknowledged that confidentiality is won at the cost of binding precedent, which presents both a potential barrier to future plaintiffs’ ability to locate necessary information as well as reduced effectiveness of binding precedence.[27] The Court of Appeals also noted that the competence of an arbitrator to analyze and decide purely legal issues in connection with statutory claims might be questioned because arbitrators do not have to be legal professionals.[28] Nonetheless, the Court of Appeals dismissed all of these criticisms by stating that the Supreme Court has decided that, as a general rule, employment discrimination claims are fully subject to binding arbitration.[29]

The Supreme Court and Court of Appeals’ dismissal of these critical issues does little to assuage the valid concerns raised regarding civil rights’ arbitration.[30]Particularly in light of the legislative history substantiating 42 USC § 1981, the Court of Appeals’ deference, without meaningful underlying analysis behind its decision, is demonstrative of the enormous lack of guidance criticized by the New York Times.

II. The Preemptive Reach of the Federal Arbitration Act

A. Basic Principles of Federal Preemption in Arbitration

The FAA is something of an anomaly in the field of federal-court jurisdiction.[31]The FAA does not vest exclusive subject matter jurisdiction in the federal courts though it creates the body of federal substantive law establishing and regulating arbitration.[32] Unless there is either a federal question or complete diversity, it is up to the state courts to apply the FAA and the federal case law standards for its implementation in any cases involving interstate commerce.[33]

Some, including some Supreme Court Justices, take this to mean that the congressional intent was that the FAA should only apply in federal court as a federal remedy.[34] The disagreement between jurists of the correct application of the FAA is, at least, indicative of the lack of clarity in the congressional intention behind the Act. The FAA says that it applies to all matters involving “interstate commerce.”[35] However, interstate commerce of 1925 was a restricted concept, to the point that a business’ involvement in interstate activity did not create sufficient minimum contact to assert jurisdiction over it.[36] Therefore, it is questionable whether this statutory language should be imposed upon by a modern definition of interstate commerce.

B. Federal Preemption of the FAA and Substantive Law Under Erie

Additionally, the Supreme Court did not distinguish substantive diversity of state versus federal law until Erie v. Tompkins in 1938.[37] Under Erie, state contract law is applied to interpret the substantive meaning of the arbitration agreement.[38] Within the context of preemption – under which interstate commerce is broadly sweeping, without regard to its substantial impact – the Court has construed the FAA as broadly as the constitutional limit.[39] Under the constitutional provisions of the Supremacy Clause, the Supreme Court has held that state courts and legislatures cannot enact statutes restricting arbitration.[40]Likewise, states cannot ease the federal presumption of arbitrability.[41]

C. Restrictions to Separability

This imposition of preemption may be the most problematic because of its restrictions to common law contract defenses. In his dissent to Prima Paint Corp. v. Flood & Conklin Mfg. Co., Justice Black described the Court’s holding that the preemptive reach of the FAA compels a counter party to carry out his agreement to arbitrate even though the a court might find the agreement void because of fraud as “fantastic.”[42] Justice Black continued in his dissent that he was unconvinced that a broad preemptive application of the FAA is not a denial of a person’s rights to due process of law.[43]

Under contract law,undue influence, fraud, and unconscionability are remedies available to parties attempting to rescind a contractual clauses. Contract defenses may be ruled on separately or prior to arbitration. This makes sense because, as Justice Stevens suggested, there is no need to arbitrate an unenforceable agreement.[44] In Rent-A-Center, plaintiff Jackson presented a well-pleaded case of unconscionability, relying on the separability of contract and arbitration.[45]However, the Supreme Court’s decision in Rent-A-Center, that a defense of unconscionability should be heard by the arbitrator, entirely undermines the presumed separability of the arbitrable matter and the arbitration agreement.[46]

This ruling is unwieldy, at best. It does not make sense to compel arbitration of the validity of an arbitration agreement when a party claims to have contractual defenses to that arbitration agreement.[47] Nevertheless, the Rent-A-Centerdecision approves this conceptual change to separability. In light of the legislative intent of the FAA and Title VII, any denial of court access resulting from this faulty logic must be considered a lack of due process.[48]

III. Judicial Review of Arbitration Awards Post-Rent-A-Center

A. Lack of Guidance on Judicial Review of Civil Rights Arbitration

Jackson’s argument in Rent-A-Center was that the making of the arbitration agreement was unconscionable, and therefore required the court to make a determination of the agreement’s legality before compelling any arbitrable review of the dispute.[49] However, as illustrated in the previous sections, even those legal minds most versed in the FAA are unable to agree whether compulsory arbitration of employment discrimination suits can be forced on employees. The Court’s ruling in Rent-A-Center dramatically affects the ability of employees to challenge the enforceability of arbitration agreements, because it sends valid challenges to arbitration to the arbitrator.[50]

However, the Rent-A-Center decision provides little guidance on judicial review of contractual defenses to arbitration. The decision does not consider the obvious question that arises from its holding: in light of this decision, has the scope of review of arbitration awards changed such that the arbitrator’s determination of whether to arbitrate is a valid ground for judicial review?

The Rent-A-Center decision is premised on the assumption that an arbitrator’s ruling on unconscionability is still subject to post-award review under the FAA.[51]In fact, Justice Scalia was insistent that an arbitrator would not be able to disregard the law when determining whether an arbitration agreement is unconscionable.[52] However, the Rent-A-Center decision does not provide any guidance on the procedure of this scope of review.

B. The Doctrine of Manifest Disregard

Justice Scalia’s insistence that an arbitrator may not disregard the law hints at the doctrine of manifest disregard, and the validity of its application to the scope of review. The Supreme Court has ruled that, so long as the litigant may vindicate his or her statutory claim in the arbitral forum, the statute will continue to serve both its remedial and deterrent function.[53] However, actual judicial review of arbitration awards is strictly limited under section 10 of the FAA.[54] The award may be vacated only if the proceeding was tainted with corruption, misconduct or bias; if the arbitrator exceeded his or her authority; or if the arbitrator acted in “manifest disregard of the law.”[55]

Generally, manifest disregard means that the arbitrator knew the applicable law but purposefully chose to ignore it or refused to apply it.[56] Since the inception of the doctrine, there has been a great expansion of the arbitrator’s authority over disputes.[57] This expansion of power has been so broad that, under applicable arbitration rules, the arbitrator himself may not correct his award after release for substantive deficiencies.[58] Because judicial review of arbitration awards is rare, it seems a convincing argument that manifest disregard applies in circumstances where arbitrators have exceeded their powers.[59] However, the doctrine is also contested because the language of section 10 does not specifically refer to manifest disregard as an independent ground for vacating arbitration awards.[60]

A good deal of confusion around the extent of the arbitrator’s power and the applicability of manifest disregard is owed to the lack of guidance provided by recent Supreme Court decisions. Prior to Rent-A-Center, the Supreme Court held in Hall Street Assocs., LLC v. Mattel, Inc. that the statutory grounds for judicial review under section 10 are exclusive. This ruling indicated that manifest disregard was not valid grounds for review.[61] Shortly after the Hall Streetdecision, the court concluded, in dictum, that if an arbitration panel exceeds its powers, the courts are authorized by section 10(b) of the FAA to either direct a rehearing or review the question de novo.[62] The federal circuit courts have been diametrically opposed in their rulings, as they struggle to interpret the meaning of these conflicting Supreme Court writings.[63]

C. Post-Award Judicial Review after Rent-A-Center

Historically, courts have been reluctant to even review arbitration awards, let alone vacate or demand rehearing. However, Rent-A-Center may be an opportunity for a new post-award standard of review.

Consider the following: An arbitration panel is selected to hear an employment discrimination dispute. Though the panel members are all industry experts and well versed in employment discrimination issues, they are not lawyers. The employee asserts that not only have her Title VII rights been violated, but also that the arbitration agreement is invalid because it was fraudulently induced. In its misunderstanding of applicable contract law, the panel misinterprets the employee’s claim and decides that the arbitration agreement is enforceable. The panel proceeds with arbitration.

This example illustrates a potential conflict arising from the Supreme Court’sRent-A-Center and Hall Street decisions. Does the arbitrators’ incorrect determination manifest purposeful disregard of the law? Although section 10 of the FAA does not allow a court to set aside an award for an error of law per se, an argument could be made that, in such a case as the previous scenario, the arbitrator exceeded his or her powers under section 10(a)(4) by acting on an unfamiliar area of law. However, there is no precedent on how the court should proceed to review such a situation. As the Supreme Court continues to expand the scope of post-award judicial review, more guidance and clearer judicial intent will be required to direct both arbitrators and the courts.

Professional mediator and former Columbia University Negotiation and Conflict Resolution faculty member, Bathabile Mthombeni, vehemently agrees that the Supreme Court must put forth specific rules relating to civil rights arbitration claims. Professor Mthombeni is an enthusiastic supporter of mediation, including employment and statutory mediation. However, her wariness of compulsory arbitration has increased over the years in tandem with Supreme Court pro-arbitration rulings.

“I am very concerned about the way that Rent-A-Center was decided because of the impact this has on access to the courts – especially by people who are likely the most vulnerable,” Professor Mthombeni stated. “Do potential employees really have a choice? [In the future, will] this mean that an employee cannot file with the EEOC? And, as the dissent inRent-A-Center points out, how are the lawyers arguing these cases supposed to anticipate how thinly they must slice their arguments as to the seperability of various portions of the agreement to arbitrate?”

Professor Mthombeni’s concern about the Rent-A-Center case’s impact on employees and consumers is based in her extensive knowledge of both dispute resolution and civil rights statutes. She suggests that arbitrators should be held to the same standards of evidential and procedural rules that would pertain in court. “The framers of [42 U.S.C. § 1981(a)] did not anticipate those claims being investigated or decided in arbitration. My recollection of 1981 legislation is that it is especially articulated in order to allow individuals to act as attorneys general, recognizing the particular interest that society has in rooting out civil rights violations.

“It does not seem that arbitration is a forum that champions this end. I am at least concerned about the lack of protections afforded to litigants in arbitration – in particular… the rules of evidence and civil procedure not being strictly adhered to.”

Professor Mthombeni suggests that not only should post-judicial review standards be more defined but also that the Supreme Court should parallel its rulings with evidential and procedural rules of arbitration. “Some might argue that the rules of evidence and civil procedure are themselves flawed. But at least they are part of a commonly understood scheme that has evolved and been tested over several hundred years that puts everyone on level ground – so long as they all understand the rules.”

Conclusion

In their best light, the Supreme Court’s pro-arbitration rulings can be dense and confusing. The Court has upheld the validity of mandatory compulsory arbitration agreements that waive an employee’s right to court access as predicated by Title VII. The Court has held that this negation of the legislative intent of Title VII is still fair, so long as arbitration provides the same statutory remedy as the court system. The Supreme Court has previously held that, because arbitration agreements are separable contractually, a party may seek judicial review of defenses to the arbitration agreement.

However, the Supreme Court has now ruled in Rent-A-Center that the entire arbitration agreement, even the contractual defenses, may be removed to the arbitrator, for a determination of whether the agreement to arbitrate is valid. This ruling is not only a confusing departure, but also requires the Supreme Court to go further with an explanation of the scope of review for civil rights arbitration.

The Rent-A-Center opinion holds that judicial review of challenges to civil rights arbitration agreements is still available under the FAA, but does not address how this review should happen. Without guidance and procedure for post-award review, and without guidance of whether manifest disregard is applicable under the FAA, the criticism of the Supreme Court’s pro-arbitration rulings as “sweeping”, “politically polarized,” and “fuzzy” will likely continue.

[1]Liptak, Adam. “Justices Are Long on Words but Short on Guidance.” The New York Times Online. 17 November 2010, available athttp://www.nytimes.com/2010/11/18/us/18rulings.html?pagewanted=1&_r=1.

[2]Id.

[3]See Halligan v. Piper Jaffray, Inc., 148 F.3d 197, 200-01 (2d. Cir. 1998).

[4]Rent-A-Center, West, Inc. v. Jackson, 130 S.Ct. 2772 (2010).

[5]Id.

[6]Id.

[7]See id.

[8]Marks, Clifford M. “Supreme Court’s Arbitration Ruling Draws Liberal’s Ire.” The Wall Street Journal Blogs. 21 June 2010, available athttp://blogs.wsj.com/law/2010/06/21/supreme-courts-arbitration-ruling-draws-liberals-ire/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed:+wsj/law/feed+%28WSJ.com:+Law+Blog%29.

[9]Lithwick, Dahlia. “Justice by the Hour.” Slate.com. 26 April 2010. Accessed 10 November 2010. http://www.slate.com/id/2252001/pagenum/all/#p2.

[10]See Coffee Beanery, Ltd. v. WW, L.L.C., 300 F.3d 415 (6th. Cir. 2008) (holding that manifest disregard is an applicable standard of review). But see Citigroup Global Markets, Inc. v. Bacon, 562 F.3d 349(5th Cir. 2009) (holding that manifest disregard is not an applicable standard of review.)

[11]A common antebellum holding, reflecting Justice Taney’s decision in Dred Scott,was that freedmen did not have the right to exercise the same civil rights as white men. See e.g., Howard v. Howard, 51 N.C. 235 (1858).

[12]Cong. Globe, 39th Cong., 1st Sess. 41 (1866).  See generally Report of the Joint Committee on Reconstruction Pt. II, 240 (1866).

[13]See, e.g., Cong. Globe, 39th Cong., 1st Sess.1758 (1866) (statement of Sen. Trumbull).

[14]42 U.S.C. § 1981(a).

[15]Franks v. Bowman Transp. Co., 424 U.S. 747, 779 (1976).

[16]Pub. L. 102-166, Title I §118.  There has been consistent disagreement between the circuit courts whether this statutory language refers to the extent defined by Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20 (holding that an agreement to arbitrate employment claims could be binding even under the ADEA), versus Alexander v. Gardner-Denver Co., 415 U.S. 36 (holding that an employee’s suit under Title VII of the Civil Rights Act of 1964 is not foreclosed by the prior submission of his claim to arbitration).

[17]N.Y. C.P.L.R. § 7501.

[18]9 U.S.C. § 1-16.

[19]9 U.S.C. § 4.

[20]Halligan v. Piper Jaffray, Inc., 148 F.3d 197, 203 (2d. Cir. 1998).

[21]Brief of Amicus Curiae Service Employees International Union, Legal Aid Society, Employment Law Center, National Employment Lawyers Association, National Employment Law Project, Women’s Employment Rights Clinic, and The Employee Rights Advocacy Institute for Law & Policy in Support of Respondent. Part I, p. 6.

[22]Id.

[23]Id.

[24]Rodriguez de Quijas v. Shearson/American Express, Inc., 490 U.S. 477, 481 (1989).

[25]Cole v. Burns Int’l Sec. Servs., 105 F.3d 1465, 1476 (D.C. Cir. 1997).

[26]Id. at 1477.

[27]Id.

[28]Id.

[29]Id. at 1478, see also Gilmer, 500 U.S. 26, 34-35.

[30]Id.

[31]Moses H. Cone Mem’l Hospital v. Mercury Constr. Corp., 460 U.S. 1, 26.

[32]Id.

[33]Id.

[34]Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20 (J. Stevens dissenting).

[35]The Citizens Bank v. Alafabco, Inc., 539 US 52, 53 (2003).

[36]Gilmer,500 U.S. at 39-40 (J. Stevens dissenting).

[37]See Erie Railroad Co. v. Tompkins, 304 U.S. 64 (1938)

[38]Allied-Bruce Terminix Cos. v. Dobson, 513 U.S. 265, 271 (1995). “The Act’s provisions (about contract remedies) are important and often outcome determinative, and thus amount to “substantive”, not “procedural” provisions of law.”

[39]Id.

[40]Id.

[41]Prima Paint Corp. v. Flood & Conklin Mfg. Co.,388 U.S. 395, 400.

[42]Id.at 407 (J. Black dissenting).

[43]Id.

[44]Id.

[45]Id. As a matter of substantive federal law, a claim of fraud in the inducement of a contract containing an arbitration clause is for the arbitrator, but the issue of fraud in the inducement for the arbitration clause itself is a question for the court.Id.

[46]Id.

[47]130 S. Ct. at 2782 (J. Stevens dissenting).

[48]Gilmer,500 U.S. at 39-40 (J. Stevens dissenting).

[49]Brief of Amicus Curiae The American Federation of Labor and Congress of Industrial Organizations in Support of Respondent. Part I, p. 5-9.

[50]130 S. Ct. at 2782 (J. Stevens dissenting).

[51]9 U.S.C. § 10.

[52]130 S. Ct. at 2781.

[53]Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, Inc., 473 U.S. 614 (1985).

[54]Halligan v. Piper Jaffray, Inc., 148 F.3d 197, 202 (2d. Cir. 1998).

[55]Merrill Lynch v. Jaros, 70 F.3d 418, 421 (6th. Cir. 1995).

[56]Halligan, 148 F.3d at 202.

[57]The concept of manifest disregard was first used by the Supreme Court inWilko v. Swan, 346 U.S. 427 (1953).

[58]A.A.A., Rule R-46.

[59]Stolt-Nielsen S.A. v. AnimalFeeds Int’l. Corp., 548 F.3d 85, 95 (2d. Cir.

2008), rev’d on other grounds, 130 S. Ct. 1758 (2010).

[60]9 U.S.C. § 10.

[61]Hall Street Assocs., LLC v. Mattel, Inc., 552 U.S. 579, 589 (2008). “[T]he statutory text gives us no business to expand the statutory grounds [of judicial review under the FAA].” Id.

[62]Stolt-Nielsen, S.A.,130 S. Ct. at 1772.

[63]Supra note 10.

Copyright © 2011 Nicole Farbes-Lyons

Comprehensive Summary of the Final Regulations to the ADA Amendments Act

This week’s guest blogger at the National Law Review is Jeffrey S. Nowak of  Franczek Radelet P.C..  Jeffrey provides a very comprehensive overview of the final regulations implementing the ADA Amendments Act of 2008 (ADAAA):   

On March 25, 2011, the U.S. Equal Employment Opportunity Commission (EEOC) published final regulations implementing the ADA Amendments Act of 2008 (ADAAA), a statute that now greatly expands the number of employees and applicants who will be considered “disabled.”  The final regulations fundamentally change the manner in which an employer must treat and manage employees with medical conditions in the workplace, since it now will be much easier for individuals to establish that they are disabled.  This Comprehensive Summary provides an overview of some of the key provisions in the final ADAAA regulations to help employers better understand the key changes in the law and adopt strategies to minimize liability.

Background

As originally enacted, the Americans with Disabilities Act (ADA) defines an individual with a disability as a person who has a physical or mental impairment that “substantially limits” one or more “major life activities.”  Individuals may also be covered under the ADA if they have a “record of” a disability or are “regarded as” disabled.  Since the ADA took effect, the Supreme Court and lower federal courts have construed the definition of disability in a relatively narrow fashion.  On September 25, 2008, President Bush signed the ADAAA into law.  Although the ADAAA retains the same definition of “disability” under the original Act, it makes sweeping changes to the manner in which these terms are to be construed.

In short, the ADAAA and its final regulations now shift the focus of virtually every situation that implicates the ADA.  Before the amendments, the interpretation of the ADA largely focused on whether an individual was substantially limited in a major life activity and, therefore, disabled under the ADA.  Under the ADAAA’s broader construction, the focus is not directed toward the actual definition of disability, but rather on discrimination and reasonable accommodation.  Given the ADA’s new statutory framework and new regulations that stretch the statute even further, employers should be prepared now more than ever before to respond to accommodation requests, make accommodations where necessary, and take precautions to avoid discriminatory decisions involving employees and applicants with medical conditions.

A copy of the final regulations can be found here.  The EEOC also has issued a guidance sheet and a fact sheet to aid employers in understanding the final regulations.

The final regulations address key issues, which are covered in this executive summary.

  • Will certain impairments always be considered “disabilities”?
  • What constitutes a “major life activity?”
  • What does it mean to be “substantially limited” in a major life activity?
  • To what extent are temporary or episodic impairments considered disabilities?
  • How do “mitigating measures” affect the analysis of whether an individual is disabled?
  • What does it mean for an employee to be “regarded as” disabled?

Broad Construction of the Definition of “Disability”

Taking its lead from the ADAAA, the final regulations provide that the definition of “disability” should be “broadly” construed “to the maximum extent permitted by the terms of the ADA.”  (The message from Congress and the EEOC to employers could not be any clearer: Stop focusing on whether an individual is disabled and focus instead on reasonable accommodation.)  Although the final regulations track the definition of “disability,” a term which remained intact, the regulations clarify that there is a shift in focus to whether employers have complied with their obligations and whether discrimination occurred, as opposed to whether an individual meets the definition of a “disability.”

Certain impairments “virtually always” covered

Further illustrating the point, in spite of the ADAAA’s (and the final regulations’) rejection of the notion of a “per se” disability, the final regulations take the extraordinary step of listing certain impairments that “will, as a factual matter, virtually always be found to impose a substantial limitation on a major life activity.”  The EEOC suggests that these assessments should be “particularly simple and straightforward” (tellingly, the title of the subsection is “Predictable Assessments”).  These impairments include:

  • Deafness
  • Blindness
  • Intellectual disability (formerly known as mental retardation)
  • Partially or completely missing limbs
  • Mobility impairments requiring the use of a wheelchair
  • Autism
  • Cancer
  • Cerebral palsy
  • Diabetes
  • Epilepsy
  • HIV or AIDS
  • Multiple sclerosis
  • Muscular dystrophy
  • Major depression
  • Bipolar disorder
  • Post-traumatic stress disorder
  • Obsessive compulsive disorder
  • Schizophrenia

This list includes many conditions that often were not substantially limiting impairments under the pre-ADAAA.  Nevertheless, the list tends to undermine the EEOC’s long-held position that an “individualized assessment” should be conducted to determine whether an impairment is indeed a disability.

Notably, the final regulations removed a section from the proposed regulations that listed certain impairments that “may be disabling for some individuals but not for others,” such as asthma, back/leg impairment, carpal tunnel syndrome, high blood pressure, psychiatric impairment (less severe than major depression) and learning disability.  In light of the expansive sweep of the final regulations, however, plaintiffs with impairments like these, as well as others, likely will not face a difficult task in convincing a court that they are disabled.

Less Demanding Standard for “Substantially Limits”?

To be disabled, one must have an impairment that “substantially limits” a major life activity.  Under the pre-ADAAA, employers often questioned the extent to which an impairment must “substantially limit” before an individual is considered disabled.  Unfortunately for employers, the EEOC declined to quantify the term “substantially limits” in the final ADAAA regulations, explaining that “a new definition would…lead to greater focus and intensity of attention on the threshold issue of coverage than intended by Congress.”  As such, the final regulations offer employers little concrete guidance in identifying the threshold at which an impairment qualifies as “substantially limiting,” aside from the presumption that it must be a lower threshold than previously adopted by the U.S. Supreme Court in its decisions leading up to passage of the ADAAA.

Instead, the regulations provide “nine rules of construction” to be applied in determining whether an impairment “substantially limits” a major life activity.  Most of the rules come directly from the language of the ADAAA, but several have been added by the EEOC:

  1. “The term ‘substantially limits’ shall be construed broadly in favor of expansive coverage, to the maximum extent permitted by the terms of the ADA.  ‘Substantially limits’ is not meant to be a demanding standard.”
  2. The determination of whether an impairment is “substantially limiting” should be made by comparing the ability of an individual to the general population.  The impairment does not need to “prevent, or significantly or severely restrict” the performance of a major life activity in order to be substantially limiting.
  3. In all ADA cases, the focus should be on whether the employer has complied with its statutory obligations, since the “threshold issue” of substantially limits should not require extensive analysis.
  4. “The determination requires an ‘individualized assessment,’ but the assessment should be done by requiring “a degree of functional limitation that is lower than the standard for ‘substantially limits’ applied prior to the ADAAA.”
  5. Comparing an individual’s performance of a major life activity to the general population should not generally require scientific, medical or statistical analysis.
  6. The determination should be made without regard to the “ameliorative effects of mitigating measures” other than ordinary contact lenses and eyeglasses.
  7. “An impairment that is episodic or in remission is a disability if it would substantially limit a major life activity when active.”
  8. An impairment need not limit more than one major life activity.
  9. The effects of an impairment lasting or expecting to last fewer than six months can be “substantially limiting.”

The Effect of Condition, Manner and Duration

Commenting further on the “substantially limits” prong, the final regulations explain that, to determine whether an individual is “substantially limited” in a major life activity, it may be useful to consider the condition under or the manner in which an individual performs a major life activity; the duration of time it takes the individual to the activity as compared to most people in the general population; and the difficulty, effort, pain or amount of time required to perform the activity.

For example, under the new regulations, it does not matter whether an individual with a learning disability can read and write like the majority of people in the general population.  The regulations focus instead on how difficult it was for the individual to reach the level of literacy, (i.e., how long it took and the conditions which the individual had to overcome).  As a result, an individual may be substantially limited in a major life activity even if he or she can perform the activity at the same level as the general population, if it took more time, effort or work to become proficient compared to most people in the general population.

The Interpretation of “Major Life Activities” is Expanded Further

To be disabled under the law, one must have a physical or mental impairment that “substantially limits” one or more “major life activities”.  When determining whether an individual is substantially limited in a major life activity, according to the final regulations and EEOC’s interpretive guidance provide, the process should “not demand extensive analysis” and “usually will not require scientific, medical or statistical analysis.”

Notably, the final regulations expand an already “non-exhaustive” list of what may be deemed major life activities to include eating, sleeping, standing, lifting, bending, reading, concentrating, thinking and communicating.  The final regulations also include additional examples of major life activities, such as sitting, reaching and interacting with others.  When determining other examples of major life activities, the final regulations expressly reject the pre-ADAAA interpretation that the activity must be of “central importance to daily life,” a rule which expressly rejects the Supreme Court’s ruling in Toyota Motor Manufacturing v. Williams.  In effect, an activity no longer is required to be of “central importance.”

In a significant departure from the past, the ADAAA and final regulations expand the definition of “major life activities” to include the “operation of major bodily functions,” such as the immune system and normal cell growth, and neurological, bowel, bladder, circulatory and reproductive functions.  The final regulations list several additional functions, such as cardiovascular, lymphatic and musculoskeletal, and specify that the operation of a major bodily function includes the operation of an individual organ within the body (such as the liver or heart).  The appendix to the final regulations provides several examples of impairments that affect major bodily functions, e.g., cancer affects normal cell growth; diabetes affects functions of the pancreas and endocrine system; and rheumatoid arthritis affects musculoskeletal functions.

Work as a “major life activity”

The regulations also breathe new life into the “major life activity” of working.  Under the pre- ADAAA, a plaintiff’s claim that he or she was substantially limited in the major life activity of work almost always was dismissed by the court, largely because the employee was unable to show that the impairment substantially limited the employee’s ability to perform a “broad range” of jobs.  The final regulations maintain this requirement but lower the employee’s burden, claiming that this previous standard was “overly strict.”  Under the new regulations, if an individual’s job requires heavy lifting but the employee cannot lift heavy items and cannot perform the job or other jobs that require heavy lifting, then the employee is substantially limited in performing the class of jobs that require heavy lifting.  Is this shift in the rule all for naught?  As the final regulations point out, an impairment that substantially limits working will in most situations also substantially limit another major life activity.

Other Significant Regulatory Changes

Nearly All “Mitigating Measures” Are No Longer Considered

Under prior Supreme Court and federal appellate court precedent, employers were allowed to consider “mitigating measures” in determining whether an individual’s impairment substantially limits a major life activity under the ADA.  For example, if an individual used a hearing aid or cochlear implant due to a hearing impairment, it typically was not considered a disability because the individual was not substantially limited in the major life activity of hearing.  Because of the mitigating measure (i.e., the hearing aid), they could hear perfectly well.  Under the new regulations, however, employers are no longer allowed to consider such measures.  As a result, employers will be required to analyze each individual’s impairment in its unmitigated state.  Thus, the individual with a hearing aid would likely be substantially limited in hearing because we are obligated now to consider them without the use of a hearing aid.

The final regulations do provide one important exception: employers are permitted to consider the ameliorative effects of using ordinary eyeglasses or contact lenses.  The term “ordinary eyeglasses or contact lenses” is defined as lenses that are intended to fully correct visual acuity or to eliminate refractive error.  For example, an individual with severe myopia whose visual acuity is fully corrected is not substantially limited in seeing because the ameliorative effect of the lenses must be considered.  Similarly, eyeglasses or contact lenses that are the wrong or outdated prescription may nevertheless be “ordinary” if there is evidence that a proper prescription would fully correct visual acuity or eliminate refractive error.

What is also important to note is that both the ameliorative and non-ameliorative effects of mitigating measures, as well as the individual’s use or non-use of such measures (e.g., taking or refusing to take medication, even though prescribed by a physician) can be considered when determining whether the employee is a “qualified” individual with a disability or whether the employee poses a direct threat to safety; however, it will not affect whether the individual meets the definition of being disabled.

Temporary and Episodic Impairments May Constitute disabilities

Under the final regulations, short-term impairments and chronic impairments with short-term symptoms may be considered disabilities.  In the past, many courts declined to extend ADA coverage to individuals whose impairments were substantially limiting for only a short or limited period of time.  The new regulations reject this reasoning and prescribe that the duration of an impairment or symptom should not be dispositive in determining whether an individual is disabled.

Temporary and Short-Term Impairments

Clearly, one of the most significant changes to the final regulations is the EEOC’s decision to reject the long-held view that temporary impairments are not substantially limiting.  The EEOC previously took the position that the duration or expected duration of an impairment should be considered in determining whether the impairment is disabling.  That no longer appears to be the case.  The final regulations ambiguously state that “an impairment lasting or expected to last fewer than six months can be substantially limiting.” (Emphasis added).  When this language was first proposed, many commenters expressed that the new language would create confusion as to how long an employer’s impairment must last or be expected to last in order to impose ADA obligations on the employer.  (Further complicating matters, the regulations state that an employee who is regarded as having a “transitory and minor” impairment that is expected to heal shortly is not considered disabled.  Thus, it is conceivable that individual with a temporary impairment, such as a broken hand, may be disabled because the impairment substantially limits a major life activity, but may not be “regarded as” disabled for purposes of the Act.)

In response to these concerns, the EEOC opined that specifying a durational minimum for a disability would impose a more stringent standard than what Congress required.  In fact, the final regulations go even further than the proposed regulations on this point.  In the proposed rules, the EEOC identified a category of temporary non-chronic impairments that usually would not be considered a disability—for example, the common cold, seasonal influenza, a sprained joint, minor and non-chronic gastrointestinal disorders, a broken bone expected to heal completely, appendicitis and seasonal allergies.  The EEOC deleted this category in the final regulations, explaining that the provision caused confusion and was too limiting.

The EEOC’s position on the issue of temporary impairments is debatable.  It is not clear that Congress intended to extend ADA coverage to short-lived impairments.  Moreover, it is still likely that certain impairments of short duration which are expected to heal quickly, such as a common cold or a sprained ankle, will not be considered disabilities.  However, the regulations make clear that employers must consider all impairments, even short term ones, on a case-by-case basis.

Episodic Impairments

Under the ADAAA and the final regulations, an episodic impairment or impairment in remission is a disability if the impairment would substantially limit a major life activity when active.  This means that an individual with a serious chronic condition such as epilepsy or cancer could be considered disabled under the Act even if that person rarely or never experiences symptoms that would impact their employment.  The regulations provide specific examples of impairments that may be episodic in nature, including epilepsy, cancer, multiple sclerosis, hypertension, diabetes, asthma, major depressive disorder, bipolar disorder and schizophrenia.

The Act’s express inclusion of episodic impairments presents some practical challenges for employers.  Many episodic impairments are unpredictable in their effects on the individual.  For example, an employee diagnosed with asthma may not experience an attack for several months.  However, the fact that an asthma attack could limit a major life activity may require the employer to provide a reasonable accommodation.  The same is true for progressive impairments, such as Parkinson’s or Alzheimer’s Disease.  Many Parkinson’s and Alzheimer’s patients do not experience any symptoms in the early stages of the disease.  Nevertheless, the fact that an individual could at some point in the future experience symptoms that would substantially limit a major life activity likely would render the person disabled even before the condition worsens and (practically speaking) substantially limits a major life activity.

“Regarded As” Individuals Need Only Prove Perception of an “Impairment”

Under the original ADA as interpreted by the courts, an individual was “regarded as” disabled only when the employer perceived the individual to have an impairment that “substantially limited” him or her in a major life activity.  Under the final regulations, the same individual seeking to bring a “regarded as” claim need not prove that the employer believed the individual to have an impairment that substantially limits a major life activity, but merely that the employer perceived the employee as having an “impairment,” and based an employment decision on that perception.

Under the ADAAA, an individual subjected to a prohibited action (e.g., failure to hire, denial of promotion, termination or harassment) because of an actual or perceived impairment will meet the “regarded as” definition of disability whether or not the impairment “substantially limits” a major life activity unless the impairment is both transitory and minor.  The ADAAA further clarifies that a person who is “regarded as” disabled is not entitled to a reasonable accommodation unless the person also fits within one of the other two prongs of the definition of “disability.”

Notably, the final regulations specify that the “regarded as” prong should be the primary means of establishing coverage in ADA cases that do not involve reasonable accommodation, and that consideration of coverage under the first and second prongs will generally not be necessary except in situations where an individual needs a reasonable accommodation.

The final regulations further clarify that establishing that an individual is “regarded as having such an impairment” does not, by itself, establish liability.  Thus, even where an individual proves that an employer made a decision on the basis of an actual or perceived impairment, the employee must still show that he was “qualified” for the position in question in order to establish an ADA violation (i.e., he can perform the essential job functions of the position with or without a reasonable accommodation).   The employer may also utilize any otherwise available statutory defenses.  For example, an employer may still defend a decision to refuse to hire an applicant on the grounds that the individual would pose a “direct threat” to health and safety due to the nature of his impairment.

The proposed regulations originally identified several concrete examples of “transitory and minor” impairments that would not be sufficient to meet the “regarded as” prong of the statute, such as a broken bone that is expected to heal normally or a sprained wrist that was expected to heal in three weeks.  Unfortunately, these concrete examples were omitted from in the final regulations, leaving employers without clear guidance as to what constitutes a “transitory and minor” impairment.  Instead the appendix to the final regulations stress only that the inquiry as to whether an impairment is “transitory and minor” is an objective standard and provides these examples:

For example, an employer who terminates an employee whom it believes has bipolar disorder cannot take advantage of this exception by asserting that it believed the employee’s impairment was transitory and minor, since bipolar disorder is not objectively transitory and minor.  At the same time, an employer that terminated an employee with an objectively ‘‘transitory and minor’’ hand wound, mistakenly believing it to be symptomatic of HIV infection, will nevertheless have ‘‘regarded’’ the employee as an individual with a disability, since the covered entity took a prohibited employment action based on a perceived impairment (HIV infection) that is not ‘‘transitory and minor.’’

Notably, the final regulations give no example of an impairment that EEOC would find to be “transitory and minor” under this standard.

What about an employee’s symptoms?

In a nod to employers, the final regulations do not include a provision contained in the proposed regulations providing that actions taken because of an impairment’s symptoms (or because of the use of mitigating measures) constitute actions taken because of an impairment under the “regarded as” prong.  Employer commentary pointed out that this proposed standard could create liability for an employer when, for example, disciplining an employee for violating a workplace rule, even where the violation resulted from a symptom of an underlying impairment of which the employer was unaware.  This would have resulted in a clear departure from the EEOC’s existing policy guidance and court decisions, which recognize, among other things, that an employer may discipline an employee for job related misconduct resulting from a disability if the rule or expectation at issue is job related and consistent with business necessity.  EEOC Enforcement Guidance on the Americans with Disabilities Act and Psychiatric Disabilities, EEOC Notice No.  915.002 Mar. 25, 1997 http://www.eeoc.gov/policy/docs/psych.html.  The preamble to the Final Regulations states that this prior Guidance remains in effect, at least for now.

How Do Employers Respond to the New Regulations?

One might ask whether any employee is considered disabled under these new regulations.  Clearly, the ADAAA and its final regulations change how employers respond to and manage employees with medical conditions and who request accommodations in the workplace.  At a minimum, we suggest employers take the following approach to the “new” ADA.

  • The range of impairments that may substantially limit a major life activity has widened considerably.  Although not every impairment will constitute a disability, the analysis of whether an impairment “substantially limits” a major life activity will not be the focus of a court’s inquiry.  In light of this change in emphasis, employers should not focus on whether an employee is actually “disabled;” rather, they should focus on insuring that they are in compliance with the statute.  Therefore, as an initial matter, employers should review and revise workplace reasonable accommodation policies to ensure employees are aware of the policies and to make clear the lines of communication as to accommodations in the workplace.  Similarly, employers should maintain processes for identifying, evaluating, documenting and providing reasonable accommodations as required.
  • Employers should be proactive about engaging in an interactive process with employees who have an impairment.  In doing so, they should identify which among their personnel will be responsible for addressing issues of accommodation, and actually engage in an interactive process when an individual makes a request for assistance in the workplace.  An employer’s best tactic in defending an ADA lawsuit is to demonstrate that it made good faith efforts to accommodate an employee, rather than questioning or challenging the employee’s medical condition.  Thus, the interactive process above must become the norm.
  • Review all job descriptions to ensure they specifically and accurately describe the essential functions of the job.  Notably, under the new definition of a “regarded as” disability, any decision that relies in whole or in part on any perceived or actual physical impairment will be subject to scrutiny under the ADAAA.  It is now more important than ever to insure that any physical or mental job requirements are truly necessary.Employers should insure that all anti-harassment policies explicitly prohibit harassment based on disability, or perceived or actual physical or mental impairments.  Potential liability for disability-related harassment claims has increased because offensive statements that relate in any way to a mental or physical impairment may give rise to liability, regardless of whether the alleged victim actually suffered from an impairment or was otherwise disabled.  For example, an employee who calls a co-worker “psycho” or “retarded” could potentially create an actionable hostile work environment under the ADA even if the co-worker has no mental health history and has an above-average IQ.
  • Properly and contemporaneously document employment decisions involving an employee who is an individual with a disability or has a record of a disability.
  • Analyze pre- and post-employment testing and screening (including language contained in employment applications) to ensure they are job-related and consistent with business necessity.
  • Train supervisors and managers as to the broad coverage of the ADAAA and their responsibilities under the new Act.  At a minimum, the focus of training should include: 1) how they identify requests for workplace modifications; and 2) who they partner with in Human Resources as to the “interactive process” regarding modifications.

© 2011, Franczek Radelet P.C.