HR and the Courts: Recents Rulings and Legislation
Each month, CUPA-HR General Counsel Ira Shepard provides an overview of some labor and employment law cases and regulatory actions with implications for the higher ed workplace. Here’s the latest from Ira:
University Prevails in Gender-Based Pay and Discriminatory Discharge Allegations, Court Cites Faculty Vote Not to Renew Appointment and Rejects Evidence of Department Chair’s Sexist Comment
An appeals court has affirmed the dismissal of a digital art instructor’s gender-based pay discrimination and sex-based retaliatory termination lawsuit, notwithstanding a sexist comment by a department chair. The Fifth Circuit Court of Appeals (covering Texas, Louisiana and Mississippi) affirmed the trial court’s dismissal of the case on summary judgement against LSU and several individual faculty defendants (Hester v. Board of Supervisors of the Louisiana State University et al. (5th Cir. No. 16-31242, 4/4/18)).
The plaintiff, who was the wife of a law professor at the university, joined the faculty in 2009 as a part-time instructor. After she complained that she was required to perform full-time duties, the university increased her salary from $25,000 to $41,000 and gave her the title of “professional in residence.” She claimed in her lawsuit that even after the raise and title change, she was paid less than male counterparts. She also claimed her department chair told her repeatedly to behave like a “trailing spouse” of her husband, the law professor.
The court, in dismissing the plaintiff’s claims, cited a faculty vote of 15 to 2 not to renew her appointment, which the university stated was based on faculty members’ non-sex-based-related conclusions that the plaintiff had refused to teach some courses, had received poor teaching evaluations, and lacked a sufficient record of “creative activity.” The plaintiff filed an internal appeal of the faculty’s action, which was rejected. The internal appeal decision cited the plaintiff’s lack of collegiality with the faculty as an additional reason for non-renewal.
Regarding the plaintiff’s gender-based pay discrimination allegations, the court concluded that the male faculty members she cited as comparable were indeed paid more, but they also had more qualifications and/or responsibilities than she did. The plaintiff’s allegations of the department chair’s sexist remarks were dismissed as vague, long past and not directly related in time or otherwise to the faculty vote not to renew her position.
Federal Jury Awards College Female Hockey Coach $3.7 Million in Damages in Sex Discrimination and Retaliatory Discharge Case Including Allegations of Title IX Violations
Sharon Miller, former coach of the women’s hockey team at University of Minnesota Duluth, has won a $3.7 million jury verdict in her federal trial alleging that her contract was not renewed because of her sex and in retaliation for reporting alleged Title IX violations in regard to unequal treatment of men’s and women’s hockey programs at the university (Miller v. Board of Regents University of Minnesota (D. Minn., no. 0:15-cv-03740, jury verdict, 3/15/18)).
Miller’s additional claim of sexual orientation discrimination, alleging that she was also discharged because she is a lesbian, was not included in this verdict (the court dismissed that part of the case because the Eighth Circuit holds that Title VII does not cover sexual orientation). However, it has been reported that Miller and two other former female coaches are separately pursuing the sexual orientation discrimination claim against the university in state court under the state statute, which arguably covers sexual orientation.
The verdict followed a seven-day trial, and Miller was awarded $3,744,832, which according to her counsel was what Miller had asked for “to the dollar.” Bloomberg BNA has reported that the university chancellor stated that he respectfully disagrees with the verdict and that the university takes seriously its commitment to ensuring “a diverse and inclusive campus community.”
Supreme Court Changes Legal Standard in Deciding Exemptions From FLSA Overtime Requirement to the Benefit of Employers, Abandoning Long-Held “Narrow Interpretation” of the Overtime Exemption Provisions
The Supreme Court, in a recent decision holding that car service advisors are not entitled to overtime pay under the Fair Labor Standards Act (FLSA), made a sweeping change in the legal standard that has been used for decades in deciding whether an employee is exempt from overtime under the Act. In its holding, the Supreme Court rejected the employees’ claims for overtime and reversed the Ninth Circuit Court of Appeals decision which had granted the employees’ claims that they were not exempt from the overtime requirement.
In handing down a 5-to-4 decision (the four liberal-leaning justices dissented), the Supreme Court ruled that the “narrow construction” legal standard which had been used for decades in narrowly granting exemptions to the overtime provision is no longer valid. Instead, the Supreme Court held that going forward, exemption requests should no longer be treated as giving the greatest possible benefit to the worker as done under the narrow construction approach (Encino Motor Cars v. Navarro (U. S., No. 16-1362, 4/2/18).
Justice Thomas ruled, “We reject this principle as a useful guidepost in interpreting the FLSA.” His decision was joined in by Chief Justice Roberts and Justices Kennedy, Alito and Gorsuch. Justices Ginsberg, Breyer, Sotomayor and Kagan all dissented. The majority held that exemptions are entitled to a “fair reading” of the law. Commentators pointed out the narrow construction approach is akin to judges putting their thumb on the scale before making the decision.
Class Action Pension Litigation Against Prominent Universities Continues, Although Judges Continue to Narrow the Scope and Dismiss Some Claims
The class action Employee Retirement Income Security Act (ERISA) pension litigation, which has been filed separately against approximately a dozen prominent universities, continues — although some of the claims have been dismissed and the litigation has been in some cases narrowed. With the exception of the University of Pennsylvania, which was successful in having the entire class action dismissed by a federal court judge, the other cases are moving forward, with some of the allegations being thrown out by the respective presiding judges.
The most recent decision narrowing the scope of the litigation came in the Yale University case, where a federal district court judge dismissed allegations that the university acted disloyally in managing its retirement plan. The judge also dismissed the allegation that Yale offered too many investment options, concluding that the plaintiffs offered no evidence that a pension plan participant was confused by the offerings. Allegations regarding recordkeeping services, charges and related monitoring of investments remain to be litigated (Vellali v. Yale University (D. Conn. No. 3:16-cv-1345-AWT, order partly denying motion to dismiss, 3/30/18)).
Judges have allowed similar litigation to proceed against Cornell, Columbia, Duke, Emory, New York University, Johns Hopkins, Princeton, Vanderbilt and the University of Chicago.
In other pension-related news, a number of private colleges in Virginia and Wisconsin have banded together to form a “Multiple Employer Pension Plan” in an attempt to reduce the size of recordkeeping fees and the overall administrative burden to individual colleges. The Multiple Employer plans were formed separately in each of these states with help from the applicable local statewide association of private colleges. The Virginia plan has 14 private institutions participating and the Wisconsin plan is starting with two institutions. Institutions in New York and Pennsylvania are also considering establishing similar statewide plans. The Virginia plan has hired one fiduciary organization and one investment adviser to service all colleges participating.