Employment and Labor Relations Lawyer & Attorney : Porter Wright's Employer Law Report : Employment Litigation, Non-Compete, Trade Secrets

On March 27, 2008, the Supreme Court released two opinions addressing discriminatory retaliation in the workplace. In the pair of opinions, the Court broadened the scope of potential claims for retaliatory conduct by holding that: (1) employees may bring a private action for discriminatory retaliation under §1981; and (2) the Age Discrimination in Employment Act (ADEA) prohibits retaliation against federal employees who complain of age discrimination.

In CBOCS West, Inc. v. Humphries, the Supreme Court held 7-2 that under 42 U.S.C. §1981, retaliation itself is a form of prohibited discrimination when contractual rights are at stake, even though §1981 does not include the word “retaliation.” Although this particular issue had been addressed by several appellate courts, the Supreme Court had never addressed the question squarely.

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After more than a decade of effort, supporters of the Genetic Information Nondiscrimination Act (GINA) were finally granted their wish. Passed overwhelmingly by the Senate (95-0) and House (414-1), GINA was signed into law today, May 21, 2008, by President Bush. Title I prohibits genetic discrimination in the area of health insurance while Title II ensures nondiscrimination in the employment arena.

Employers have plenty of time to bring their plans and workplaces into compliance. The Act’s group health plan provisions are effective for plan years beginning one year after enactment. The employment provisions become effective 18 months after enactment – November 21, 2009.

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In Thompson v. North American Stainless LP, a divided Sixth Circuit panel expanded the class of persons protected from retaliation to include associated third-parties. In so doing, the Sixth Circuit created a split among the federal appellate circuits to have weighed in on this issue: the Sixth Circuit now expressly allows associational retaliation claims, and the Third, Fifth, and Eighth Circuits have expressly rejected them.

In Thompson, a woman filed a sex discrimination charge with the EEOC.  Three weeks later, the employer terminated the woman's fiance, who it also employed.  The fiance filed his own EEOC charge and, eventually, a lawsuit, and alleged that his termination amounted to retaliation for his fiance's EEOC charge.  In response, the employer argued, among other things, that there is no cause of action under Title VII for retaliation against associated third-parties.  The trial court agreed and dismissed the case.  The plaintiff appealed, and the EEOC filed an amicus ("friend of the court") brief in support of associational retaliation claims.

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If your business model includes extensive use of independent contractors, you’re going to want to pay attention to the Ninth Circuit's decision in NLRB v. Friendly Cab Company, Inc., Case No. No. 05-73813 (9^th Cir., January 8, 2008). In the latest attack on the independent-contractor business model, the Ninth Circuit upheld an NLRB finding that the taxi drivers who leased cabs from Friendly Cab were not independent contractors but, in fact, were employees. The NLRB reached this conclusion despite the fact that, after making lease payments, the drivers kept all of their fares. Ordinarily, this factor – that the risk of profit or loss falls on the worker -- creates a "strong inference" of independent contractor status because the purported employer would have no incentive to control the means and manner of the drivers' performance. Nevertheless, the court deferred to the NLRB's conclusion that this inference was rebutted by other evidence that Friendly Cab, in fact, exerted significant control over the drivers and, as a result, found that Friendly Cab was obligated to meet and bargain with the drivers’ union.

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