Monday, December 20, 2010

Ever Filed For Bankruptcy? Don't Put It On Your Resume.

On December 15, 2010, in the case of Rea v. Federated Investors, No.: 10-1440, the Third Circuit Court of Appeals held that the federal Bankruptcy Code does not prohibit a private employer from refusing to hire an applicant solely because that applicant had previously filed for bankruptcy.

The plaintiff in this case, Dean Rea, had filed for bankruptcy in 2002 and his debts were discharged in 2003. In 2009, Rea applied for employment with Federated Investors, a private company. After an interview, it initially appeared that Rea would be hired by Federated Investors. Rea was later informed, however, that Federated Investors had refused to hire him because he had previously been in bankruptcy.

Rea then filed suit, arguing that section 525(b) of the Bankruptcy Code (11 U.S.C. 525(b)) prohibited discrimination against an individual solely because he or she is or has been a debtor in bankruptcy. Specifically, section 525(b) directs, in pertinent part, that:

"No private employer may terminate the employment of, or discriminate with respect to employment against, an individual who is or has been a debtor under this title, a debtor or bankrupt under the Bankruptcy Act, or an individual associated with such debtor or bankruptcy, solely because such debtor or bankrupt -- (1) is or has been a debtor under this title or a debtor or bankrupt under the Bankruptcy Act. . ."

The District Court dismissed Rea's case, holding that the language of Section 525(b), above, does not prohibit an employer from refusing to hire an applicant on the basis of a previous bankruptcy.

On appeal, the Third Circuit agreed, and affirmed the dismissal of Rea's case. Specifically, the Court looked at the language of Section 525(b) quoted above, which is directed to private employers, and compared it to the language set forth in Section 525(a), which is directed to governmental agencies. The Court noted that the texts of Sections 525(a) and 525(b) are nearly identical, but not completely. The Court noted that Section 525(a) provides that a governmental unit shall not "deny employment to, terminate the employment of, or discriminate with respect to employment against," a person that is or has been in bankruptcy, but that Section 525(b) lacks any such language concerning "denying employment to." The Third Circuit held that the omission of the phrase "deny employment to," by Congress in Section 525(b) was intentional, and effect must be given to this important difference. As such, the Court reasoned that by intentionally omitting the phrase "deny employment to," in Section 525(b), after having specifically included it in Section 525(a), Congress did not intend to prohibit a private employer from refusing to hire an applicant because of that applicant's previous or current bankruptcy.

You can view the Third Circuit's full opinion here: http://www.ca3.uscourts.gov/opinarch/101440p.pdf

Thursday, December 16, 2010

Eastern District of PA: ADA Claim For Failure To Provide Disabled Employee With A Cell Phone May Be Sent To A Jury

In the case of Boandl v. Geithner, No.: 09-4799 (E.D. Pa. 11/2/2010), the U.S. District Court for the Eastern District of Pennsylvania held that a jury was permitted to hear the claims of Richard Boandl, a disabled former IRS Revenue Agent, in which he alleged that the IRS had failed to engage in the interactive process required by the Rehabilitation Act and the Americans with Disabilities Act (ADA), when his immediate supervisory summarily denied his verbal request to provide him with a cell phone to assist him in the performance of his investigative duties.

At a young age, Boandl had been infected with polio, and as a result, has been disabled for most of his life. He has a severe limp, cannot stand for more than a few minutes at a time, and requires the use of a cane to walk short distances and a wheelchair to travel distances of more than twenty yards. Boandl had been employed as a Revenue Agent with the IRS from 1983 until 2004.

In late 2003, Boandl spoke to his immediate supervisor and requested that the IRS issue him a cell phone as a reasonable accommodation for his disability. Boandl alleged that he needed a cell phone to assist in his investigative duties, which required traveling outside his office to locate tax non-filers and visit witnesses. Boandl told his supervisor that because of his disability, it was difficult for him to repeatedly have to get in and out of his car, walk and stand while in the process of trying to locate, and then use, a working pay phone while out of the office. Boandl alleged that his supervisor immediately denied his request. Boandl then emailed a copy of his cell phone request to his supervisor on or about December 11, 2003. On January 20, 2004, Boandl's supervisor provided him with a written memorandum officially denying his request for a cell phone on the basis that the IRS did not issue cell phones to any employees holding Boandl's position, and that the ability to be able to return phone calls while in the field was not an essential function of Boandl's position.

In denying the government's subsequent Motion for Summary Judgment on this issue, the Court found that Boandl had produced sufficient evidence that would allow a jury to conclude that the IRS had failed to engage in the interactive process required by the Rehabilitation Act and the ADA because Boandl's supervisor had summarily denied his oral request for an accommodation. Moreover, the Court noted that the IRS' stated reason for denying Boandl' request, i.e., that the need to return phone calls while in the field was not an essential function of his position, was not the sole reason for Boandl's cell phone request. Rather, Boandl had specifically alleged that he had investigative duties while out of the office, such as locating non-tax filers and locating witnesses, which required the use of a cell phone. The Court held that because the government had failed to present any evidence that these tasks were not essential functions of Boandl's job, it was not entitled to summary judgment on this claim. Therefore, a dispute existed over whether the tasks identified by Boandl were essential functions of his position, which was required to be resolved by a jury.

The lesson that employers and HR specialists need to take away from this case is that summarily denying requests for accommodation under the ADA or the Rehabilitation Act is never good practice. Rather, each request, even if it may facially appear to not require an accommodation, should be given its due consideration and analysis. A summary denial of any request for accommodation, especially one that is made verbally, can leave an employer exposed to a claim for failure to engage in the required interactive process.

Western District of PA Dismisses Title VII and ADA Claims for Insufficient Facts

In the case of Robuck v. Mine Safety Appliances Co., No.: 2:10-cv-00763 (W.D. Pa. 11/3/2010), the U.S. District Court for the Western District of Pennsylvania dismissed claims of retaliation under Title VII and the ADA due to the employee's failure to plead sufficient factual allegations. While the arguments behind Robuck's claims here may have been admittedly weak from a plaintiff's perspective, this case serves as an important reminder of the importance that needs to be paid by a plaintiff's attorney to fact-pleading in the aftermath of the now infamous Twombly and Iqbal decisions.

The employee, Dennis Robuck, claimed to suffer from hypertension that required him to avoid stress and to take long walks on a regular basis, which he often did on his lunch break. He also alleged to have a problem with a female co-worker, Ruth Protzman, who apparently also took walks during her lunch break, as well. Robuck alleged that he made every attempt to avoid Ms. Protzman, and even the employer admitted that up until February of 2007, it had made every effort to keep Robuck and Ms. Protzman separated. One of the ways in which it did this was to allow Ms. Protzman to take her lunch hour at 11:30 AM, while Robuck took his lunch hour at 12:00 PM.

In February of 2007, however, the employer changed Robuck's lunch hour to 11:30 AM. Robuck alleged that the employer failed to accommodate him by changing his lunch hour back to 12:00 PM, despite his continuing complaints. Robuck also alleged that he had made numerous complaints to his supervisor, stating that the employer had given priority to Ms. Protzman over Robuck when attempting to separate them.

On October 29, 2007, Robuck was terminated by his employer, and subsequently received a letter from the employer indicating that had been discharged for willfully disregarding workplace rules.

Robuck subsequently filed suit, alleging that the reason given by the employer for his termination was pretextual, and that he was actually terminated for walking on a road on which the employer believed Ms. Protzman might also have been walking on at the same time. Robuck insisted, however, that Ms. Protzman was not even walking on the road at that time and that she was not even at work on the date of his alleged offense. Robuck alleged retaliation on the basis of sex in violation of Title VII, and retaliation in violation of the ADA.

The employer filed a motion to dismiss, arguing that Robuck had failed to allege sufficient facts to sustain claims of retaliation under either Title VII or the ADA. The District Court agreed, and dismissed both claims. With respect to Robuck's claim that he was treated less favorably by his employer than Ms. Protzman, the Court held that the only real facts alleged by Robuck in his Amended Complaint related to his ongoing dispute with Ms. Protzman and the employer's attempt to keep them apart, which was thwarted by a change in lunch schedule. However, the Court found that "[Robuck's] allegations are little more than generalized complaints of unfairness which do not and cannot constitute protected activity." While Robuck alleged that the employer "always gave priority," to Ms. Protzman, he failed to set forth any facts to "support his conclusory allegation that he complained of sex discrimination to his supervisor or anyone else." Moreover, the Court recognized that "[Robuck's] Amended Complaint is similarly vague in that [the employer's] alleged favoritism towards Ms. Protzman could have been motivated by any number of factors which are not protected under Title VII."

With respect to Robuck's ADA retaliation claim, the Court noted that while "[Robuck] alleges that [the employer] has discriminated against him as a result of his previous complaints of discrimination based on [his] disability . . . [Robuck] . . . provides no indication that he ever mentioned his disability during his discussion with his supervisor . . . or anyone else. Therefore, [Robuck] did not explicitly or implicitly plead that his alleged disability was the reason for the unfairness in which he complains. Accordingly, such complaint does not constitute 'protected activity' to constitute a prima facie case of retaliation." Therefore, the Court dismissed Robuck's ADA claim as well.

Had more care been taken by Robuck's counsel in drafting the Amended Complaint in this case, so as to include more specific facts, circumstances and events, it is possible that the Court would not have dismissed it at a 12(b)(6) stage. At the very least, getting past the pleadings and into active discovery may have allowed Robuck to garner some leverage in which to settle the case. But, a sloppy and imprecise Amended Complaint here served no other purpose but to get Robuck's Title VII and ADA retaliation claims dismissed at the outset. It should also be noted that Robuck received no sympathy from the Court with respect to his request to be allowed to file a Second Amended Complaint to correct these deficiencies. As of the date of the Order dismissing these claims, the Court noted that this case had been in litigation for nearly three years. Given that length of time, the Court held that "[Robuck] and his counsel have had ample time and the necessary means to secure and plead facts to support his claims," and as such, allowing Robuck the opportunity to file a Second Amended Complaint would be, in the Court's own words, "futile."

The lesson is clear - pay close and careful attention to your factual pleadings. The more, the better.