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Advocacy & Compliance News

Legal Watch - September 21, 2016
September 21, 2016

By Ira Michael Shepard, CUPA-HR general counsel and partner with Saul Ewing LLP

Federal Trial Court Dismisses Transgender Discrimination Case, Citing Religious Freedom Restoration Act

In a controversial case, a federal district court in Michigan ruled in favor of a funeral home in dismissing a discrimination case brought by a transgender employee transitioning from male to female who was fired for violating the funeral home’s dress code, which required males to wear suits and females to wear skirts. The court dismissed the case under the Religious Freedom Restoration Act, which requires the government to show a “compelling reason” to restrict religious liberty (EEOC v. Harris Funeral Homes (E.D. Mich., No. 14-13710, 8/18/16)).

The case was unique for a number of reasons, including the fact that Congress has not amended Title VII to include transgender as a protected class. Therefore, the EEOC brought the suit under a sex stereotype theory. In addition, the funeral home was not a religious funeral home, so the defense argued with court approval that the Religious Freedom Act applied to the funeral home’s owner’s religious beliefs. The court observed that the EEOC could have brought a less restrictive suit proposing a gender neutral dress code but did not. Commentators have observed that the Religious Freedom Act defense is only usable against the government and that if the individual charging party had brought the suit, instead of the EEOC, the court may not have dismissed it.

The EEOC has not yet decided whether to appeal the decision and may continue to press the claims in other courts pending a higher court acceptance of this decision. 



Age Discrimination Lawsuit Dismissed Under the “Honest Belief” Rule

The United States Court of Appeals for the Sixth Circuit affirmed the dismissal of an age discrimination claim under the “honest belief’ rule where the plaintiff’s supervisor terminated the employee under the company’s policy which calls for termination after four disciplinary actions. The court concluded that the employee had in fact received four disciplinary actions, which the company called “coachings,” and that the supervisor honestly believed he was enforcing the company’s age-neutral policy. The court concluded that the plaintiff pointed to no direct evidence that would call into question the supervisor’s honestly stated belief (Richardson v. Walmart Stores Inc. (6th Cir. No. 15-1142, 9/9/16)).

The plaintiff alleged that other supervisors began asking her after she turned 60 when she was going to quit or leave. She also alleged that another supervisor said to her son who was also a Walmart employee that she was too old to work at the store. The plaintiff was 62 when she was terminated, and the court concluded that she presented no evidence that would call into question her supervisor’s honest belief that he terminated her consistent with the company policy on four “coachings.” 

SEIU Loses $5.3 Million Jury Verdict to Janitorial Firm in “Business Disparagement” Case

A Texas state court jury rendered a $5.3 million verdict in favor of a Texas-based non-union janitorial firm that had been the victim of an adverse corporate campaign by a Houston local of the Service Employees International Union (SEIU) (Professional Janitorial Service of Houston, Inc. v. SEIU Local 5, (Tex. Dist. Ct., No. 2007-27181, jury verdict, 9/6/16)).

The activity came as part of the SEIU’s “justice for janitors” campaign in the Houston, Texas area, where five of the six large janitorial firms had signed “neutrality” agreements demanded by the SEIU. The company in question, PJS, refused to sign the neutrality agreement, exercising its right under the National Labor Relations Act to oppose unionization during a National Labor Relations Board (NLRB)-supervised representation election. PJS stated it would only recognize SEIU after an NLRB-supervised secret ballot election if the union won a majority of the votes. SEIU launched a corporate campaign in response to PJS’s position, which according to PJS contained false allegations of wage and hour and other labor law violations. SEIU allegedly published these false allegations on its website and in fliers, handbills, letters, reports, emails and speeches.

SEIU’s admitted goal in publishing these reports was to have PJS lose business to unionized janitorial firms. PJS allegedly lost several accounts as a result of the false allegations, and the jury verdict was rendered to compensate the company for lost profits under the unlawful business disparagement theory applicable under Texas law.  

Long Island University Ends 12-Day Lockout of 400 Faculty Members at Its Brooklyn Campus

Long Island University and the union affiliate of the American Federation of Teachers that represented 400 faculty members at the university’s Brooklyn campus reached an agreement on September 15, 2016, ending a 12-day lockout by the university. The union agreed to extend the expired collective bargaining agreement through May 2017, which is the end of the academic year, with a no-strike agreement in effect until then. The parties agreed to proceed to collective bargaining negotiations with the help of a mediator over a new contract to replace the one that had expired on September 2. Commentators indicated that they do not remember another lockout of faculty by any other university in the past.

AFL-CIO President States Organizing of Grad Assistants in the Wake of the Columbia University Decision Will Be “Easy Sell”

ARichard Trumka, president of AFL-CIO — the country’s largest labor organization — said recently in an interview that organizing graduate assistants in the wake of the NLRB’s decision in the Columbia University case, which allows such organizing at private colleges and universities to proceed, will be an “easy sell.” Trumka said that graduate students have been “exploited for years” and that organizing graduate students is nothing new. Trumka pointed out that before the Brown University decision in 2004, the NLRB had allowed such organizing and that organized labor has been waiting for that decision to be reversed. Trumka said the “gates will open” and that “these people … are students, but they are also employees,” and for unions it’s a “pretty easy sell.”