Employment Litigation Blogs

The EEOC recently announced that a federal judge awarded a default judgment of $148,000 against a Milwaukee based medical staffing firm, based upon allegations by the firm’s former bookkeeper that she was subjected to pregnancy discrimination.  The EEOC’s suit alleged that the owner of HCS Medical Staffing, Inc. discriminated against Roxy Leger when he made offensive comments about her pregnancy and fired her because she needed to take maternity leave following the birth of her child.  In entering the default judgment the federal judge stated that the “circumstances leading up to HCS’s discriminatory termination of Leger were inherently humiliating and caused Leger substantial emotional distress.  The circumstances surrounding Leger's notification of termination were equally degrading.”  According to the EEOC, the judge summarized the alleged pregnancy discrimination, and found that HCS’s owner referred to Leger’s pregnancy as a joke; insisted that maternity leave last no more than a couple of days; suggested that Leger’s pre-natal appointments were a ruse for additional time off or for money; and gave Leger an offensive graphic diagram of a machine which would allegedly allow Leger to return from her maternity leave sooner.  With no prior warning or discipline, HCS terminated Leger’s employment and stopped her health insurance coverage while she was still in the hospital recovering from a Caesarean section.  Leger learned of her termination days later by certified mail.

The EEOC’s victory on behalf of Ms. Leger is an exciting resolution of a compelling case, but unfortunately Ms. Leger is not the only woman who has suffered harassment or discrimination as a result of being pregnant.  In this rough economic climate, an increasing number of women who are expecting are continuing to work through their pregnancy.  This presence of pregnant employees has brought to light many instances of harassing or discriminatory conduct by employers.  Generally, pregnancy discrimination violates Title VII of the Civil Rights Act of 1964, as amended by the Pregnancy Discrimination Act, which precludes discrimination based on pregnancy when it comes to any aspect of employment, including hiring, firing, pay, job assignments, promotions, layoff, training, fringe benefits, such as leave and health insurance, and any other term or condition of employment.  Additionally, pregnancy caused impairments, such as gestational diabetes or preeclampsia, may be disabilities under the Americans with Disabilities Act (ADA), which requires an employer to provide reasonable accommodations such as leave or work modifications.  Moreover, under the Family and Medical Leave Act (FMLA), a new parent may be eligible for 12 weeks of leave to care for the new child.

If you believe that your employer is harassing or discriminating against you because of your pregnancy, or the effects of your pregnancy, give Booka Smith or Clayton Wire of Starrs Mihm LLP a call to discuss your potential claims.

The IRS issued new regulations on January 23, 2012, regarding the taxation of damages for injuries or sickness that are received through settlement or judgment.  The new regulations, 77 Fed. Reg. 3106, maintain the previous rule that emotional distress damages received through settlement or judgment are taxable income.  However, if the emotional distress is attributable to a physical injury or physical sickness, then the damages may be non-taxable, and some medical expenses for emotional distress are also excluded.  Another change in the regulations strikes the old requirement that to be excluded the damages must be based on an action that sounds in tort.  Now, the regulations provide for much broader coverage of damages.  In an employment discrimination, harassment or retaliation context, this means that a plaintiff’s recovered damages, whether through settlement or judgment, may be non-taxable if those damages resulted from physical injury or physical sickness, or if they resulted from emotional distress that was caused by or exacerbated by physical injury or physical sickness.  While taxation issues may not be the first thing on an employee’s mind when they suffer workplace discrimination, workplace harassment, or retaliation for reporting wrongful activity, it is good to know that in some cases the damage settlement or judgment that results from these wrongful employment practices is non-taxable.  Employees who believe that they have been discriminated against, harassed, or retaliated against should contact Booka Smith or Clayton Wire at Starrs Mihm LLP immediately to discuss their potential claims.  Although we are not tax attorneys, we may be able to help wronged employees get to the point where they need to worry about tax matters.

Documents from the recently unsealed case of U.S. ex rel Curren v. Denver Health Medical Center et al. reveal that Denver Health has agreed to a $6.3 million settlement with the federal government.  This settlement will resolve claims alleging that Denver Health inappropriately classified patients as receiving “inpatient” care in order to receive higher Medicare and Medicaid payments. Whistleblower Joanne Curren will receive $818,000 as a result of the federal government’s settlement with Denver Health.  Ms. Curren was an accountant who noticed the inappropriate classifications and payments and reported these issues internally to her superiors.  Rather than remedying the inappropriate classification and self-reporting the overpayments to the government, Denver Health terminated Ms. Curren.  Ms. Curren’s Complaint asserted False Claims Act (FCA) claims for fraudulent Medicare and Medicaid payments, as well as a claim under the FCA for retaliation.  The FCA allows individuals to act as “relators” in claims against corporations that defraud the government, and provides substantial monetary incentives in the form of a percentage of the settlement or judgment.  The FCA also provides protection for whistleblowers, such as Ms. Curren, who engage in activity in furtherance of a FCA claim, essentially barring an employer from retaliating against an employee for pursuing a FCA claim.  Individuals who know of a violation of the FCA or have been retaliated against for reporting their employer’s fraud, internally or externally, should contact the experienced employment law team at Starrs Mihm LLP immediately to discuss their potential claims. 

In an opinion that provides new ammunition for whistleblowers, the U.S. Court of Appeals for the Seventh Circuit permitted Michael DeGuelle’s claim for retaliation under the Racketeer Influenced and Corrupt Organizations Act (RICO) to continue.  According to his Complaint, Mr. DeGuelle had previously blown the whistle internally on tax law violations by his employer S.C. Johnson & Son, Inc., before he filed a claim under the Sarbanes-Oxley Act (SOX) with the Department of Labor.  Subsequent to this filing, Mr. DeGuelle was terminated in apparent retaliation for his SOX filing and whistleblowing activities.  Mr. DeGuelle filed a lawsuit alleging various state and federal claims.  Two of Mr. DeGuelle’s claims alleged that his former employer violated the federal RICO statutes based upon a pattern of racketeering activity, which includes violation of § 1513 of SOX.  Under this section of SOX, it is a crime to “knowlingly, with intent to retaliate, take[] any action harmful to any person, including interference with the lawful employment or livelihood of any person, for providing to a law enforcement officer any truthful information relating to the commission or possible commission of any Federal offense[.]” 18 U.S.C. 1513(e).   The Seventh Circuit stated that “[t]he language of § 1513(e) and logic imply that retaliatory actions always occur after a whistleblower reports others' wrongdoing,” and consequently the retaliation for such whistleblowing could be considered  part of a scheme to prevent disclosure, and thus a proper basis for a RICO claim.  This ruling permits whistleblowers who file a complaint under SOX and are retaliated against to take advantage of the increased damages provisions and attorney fees provisions of the federal RICO statutes.  Current or former employees who have blown the whistle against their employers, or who are contemplating blowing the whistle, should contact Starrs Mihm LLP immediately to discuss their options.

Under a series of recent decisions by the National Labor Relations Board (NLRB), employees who are retaliated against for posting comments on social media websites regarding work conditions may be protected by Sections 7 and 8 of the National Labor Relations Act.  Under these sections employees have the right to engage in concerted activity for the purpose of “mutual aid or protection,” regarding work conditions, and employers cannot retaliate against employees for exercising such rights.  This protection applies regardless of whether the employees are unionized or not.  In one particular case an employee called her boss a “scumbag” on her Facebook page after she had been reprimanded about a customer complaint, which drew various positive responses from her co-workers.  Such activity was found by the NLRB to be protected activity, as it concerned the conditions of the employee’s employment and was joined in by other employees.  The real issue with such postings is usually whether the posting is actually a comment regarding work conditions, or whether it strays into the unprotected area of “opprobrious” comments.  “Opprobrious” comments are often characterized as mere gripes and sudden outbursts against management.  However, regardless of the details, the NLRB’s recent decisions represent a shift in application of the decades old protections for concerted activity to a modern realm of organization and communication.  Facebook, Twitter, LinkedIn and other social media websites are the newest arenas for collective action of all sorts.  One need not look further than the recent Occupy movement and the revolutions across the Arab world for confirmation of this.  Thus it is not surprising that the NLRB would defend those that engage in protected activity in these arenas from illegal employment actions.  Individuals who have been terminated or otherwise retaliated against for work related postings on social media websites should contact Starrs Mihm LLP to discuss their potential claims. 

On November 18, 2011, President Obama signed H.R. 2112, the Consolidated and Further Continuing Appropriations Act of 2012 into law.  In addition to continuing VA and FHA housing benefits and implementing a veteran’s employment program, this bill also included $360 million in funding for the Equal Employment Opportunity Commission (“EEOC”) for FY 2012.  This figure reduces the EEOC’s budget by $7 million from what the agency received in FY 2011 and is $25.5 million less than the EEOC requested.  This budget cut comes just a few days after the EEOC’s release of its Fiscal Year 2011 Performance and Accountability Report (“PAR”) on November 15, 2011.  The PAR reflects that although the EEOC is losing funding the number of discrimination charges that the agency deals with is steadily increasing.  In fact, in FY 2011 the EEOC received a total of 99,947 charges, which is the highest number of charges in the agency’s 46 year history.  This increased number of charges is part of a five year upward trend from the 75,768 charges that the EEOC had in 2006.  As the EEOC expects this trend to continue, with 108,000 charges expected in 2012, these new budget constraints may impose certain limitations on how the EEOC deals with its caseload.  There is a potential that EEOC will shift some of its focus to large-scale employment cases and to higher-stakes litigation.   During these rough economic times, even the agency that protects American workers from discrimination based upon their race, color, religion, sex, national origin, age, disability and genetic information, is taking a hit.  It is more important now than ever to have competent counsel standing by your side as you try to navigate an underfunded EEOC.  Individuals who believe they may have been discriminated against by their employer should contact Starrs Mihm LLP as soon as possible to discuss their potential case.

The recent news surrounding multiple allegations against Presidential candidate Herman Cain has brought the issue of workplace sexual harassment into the spotlight again.  The allegations against Mr. Cain, whether true or not, reflect the serious nature of sexual harassment in today’s workplace.  Too often employees are forced to endure unwanted sexual advances, inappropriate sexual statements and generally offensive sexual conduct and comments that make the workplace a “hostile work environment.”  While isolated jokes, teasing or comments may not provide a sufficient basis for a sexual harassment claim based on a hostile work environment, the true test involves careful consideration of the subjective and objective factors involved in the particular circumstances.  In Christian v. AHS Tulsa Reg’l Med. Ctr., LLC, the Tenth Circuit Court of Appeals recently described these considerations as a two-part test, requiring the victim to first “establish that a reasonable person would find the work environment hostile or abusive,” and then to show “that she [or he] subjectively perceived the work environment to be hostile or abusive.”  In other words, to succeed on a sexual harassment claim based upon a hostile work environment, the victim must not only show that he or she perceived the circumstances to constitute a sexually hostile or abusive environment, but also that a reasonable person in the same situation would also perceive the circumstances to be sexually hostile or abusive.  Ariane De Vogue has posted a good article about sexual harassment and Mr. Cain on the ABC News Legal Blog at abcnews.go.com/blogs/politics/2011/11/sexual-harassment-where-is-line-drawn/.  Victims of sexual harassment in the workplace, amounting to a hostile work environment, should contact Starrs Mihm immediately to discuss their potential claims.

Just four months after the U.S. Supreme Court dismissed their nationwide class action lawsuit for gender discrimination, Betty Dukes and other current and former Wal-Mart employees are back.  Although the Supreme Court’s decision in June held that the original plaintiff class did not meet the commonality requirements for class certification, it did not rule on the substance of the class Complaint, i.e. whether Betty Dukes and other female Wal-Mart employees had in fact been victims of sexual discrimination.  The Supreme Court did however lay out specific guidelines for class certification, including a more stringent commonality requirement.  As Justice Scalia wrote for the five justice majority, the class certification failed in part because the case involved “literally millions of employment decisions,” and the plaintiffs could not point to “some glue holding the alleged reasons for all those decisions together.”  Consequently, on October 26, 2011, a fourth amended complaint was filed in the Dukes v. Wal-Mart Stores, Inc. case in the U.S. District Court for the Northern District of California.  This complaint specifically limits the potential class to female Wal-Mart employees in California and some surrounding areas.  The complaint also attempts to correct other issues of commonality noted by the Supreme Court, by focusing on the common facts of the class claims and the narrowed focus of the class representation.  The complaint describes the California region of Wal-Mart stores as implementing a “good old boy philosophy” where job opportunities were passed along by word-of-mouth, rather than being posted, and usually given to men.  Employees and former employees who believe that they are or have been the victim of gender discrimination in the workplace should contact the employment discrimination attorneys at Starrs Mihm LLP of Denver, Colorado, as soon as possible to discuss their potential claim.