In a huge victory for the nation’s largest private employer, the United States Supreme Court ruled on June 20, 2011, that a class comprised of an estimated 1.5 million former and current female Wal-Mart employees could not proceed with a class action lawsuit alleging gender discrimination under Title VII of the Civil Rights Act of 1964. Due in part to the sheer magnitude of the proposed class, the case – Wal-Mart Stores, Inc. v. Dukes – has received an enormous amount of media attention. At least within legal circles, the decision is likely to continue to receive attention for years to come because it has a significant impact on the standard used to determine whether the claims of diverse plaintiffs have enough in common to be certified as a class action.   The decision will make it much more difficult for very large groups of plaintiffs to litigate their employment-related claims together and thereby increase their economic leverage in litigation.

The issue before the Court was whether the former and current employees could proceed with their claims together in the form of a class action sex discrimination lawsuit. The plaintiffs alleged that Wal-Mart discriminated against female employees by denying them equal pay and/or promotions. More specifically, the plaintiffs contended that the discrimination was due to Wal-Mart’s pay and promotions policy. The policy generally left pay and promotion decisions to the broad discretion of managers and supervisors. There was little oversight of such decisions by upper management. The plaintiffs contended that this broad discretion fostered a discriminatory corporate culture that included the use of gender stereotypes in pay and promotion decisions.
 

Wal-Mart countered by arguing that the plaintiffs could not satisfy the legal prerequisites for a class action. Under federal law, in order to be certified as a class, the plaintiffs must demonstrate that there are questions of law or fact common to the class. Wal-Mart contended that the plaintiffs could not meet this “commonality” standard because their individual experiences with the Company were so vastly different, decision-making was decentralized, and the only written policy that was relevant was one that prohibited all forms of discrimination. In other words, Wal-Mart argued there was no evidence of an illegal policy or practice common to all of the plaintiffs.

Ultimately, the Supreme Court agreed with Wal-Mart. The Court held that while the plaintiffs all alleged gender discrimination in pay or promotions, the mere evidence of a common injury (i.e., all members alleging a Title VII violation) does not meet the commonality standard. The Court explained that it was the plaintiffs’ burden to show “significant proof” that the Company operated under a “general policy of discrimination.” The Wal-Mart employees, however, could not point to any such policy. If anything, the Court noted that Wal-Mart’s policy was just the opposite of a uniform corporate policy. Each manager and supervisor had significant discretion in making pay and promotion decisions. The plaintiffs did argue that the practice of giving managers and supervisors discretion was a policy which had a discriminatory disparate impact. While acknowledging that such a policy could theoretically be the basis for a Title VII disparate impact claim, the Court concluded that this theoretical possibility was not sufficient alone to satisfy the commonality requirement. Instead, that policy of discretion had to be tied to a specific employment practice which, in turn, tied the 1.5 million claims together. The Court concluded that the plaintiffs had no such evidence, finding that the plaintiffs’ statistical evidence regarding pay and promotion, anecdotal accounts of discrimination by a fraction of the class members, and testimony from a sociologist about the impact of Wal-Mart’s corporate culture, were all insufficient to satisfy the plaintiffs’ burden of showing commonality.
 

Earlier today, the United States Department of Labor (“Department”) issued a Notice of Proposed Rulemaking which would expand the reporting requirements of employers and the labor relations consultants they hire to advise them during a union organizing campaign. The Labor-Management Reporting and Disclosure Act (“LMRDA”) already requires employers and labor relations consultants to file annual reports with the federal government to disclose agreements (and any associated payments), where a purpose of the agreement is to persuade employees “to exercise or not to exercise, or persuade employees as to the manner of exercising, the right to organize and bargain collectively.”

However, the LMRDA does not require a report when the services rendered relate to the “giving or agreeing to give advice” to an employer. This so-called “advice exception” has long been interpreted to exempt various activities engaged in by consultants, including the preparation of speeches and other written material used by an employer during a union organizing campaign, as long as the consultant does not meet directly with the employees for the purpose of engaging in persuader activity and the employer is free to accept or reject the written material prepared by the consultant.
 

The proposed rules narrow dramatically the advice exception. According to the proposed rules:

With respect to persuader agreements or arrangements, “advice” means an oral or written recommendation regarding a decision or a course of conduct. In contrast to advice, “persuader activity” refers to a consultant’s providing material or communications to, or engaging in other actions, conduct or communications on behalf of an employer that, in whole or in part, have the object directly or indirectly to persuade employees concerning their rights to organize and bargain collectively. Reporting is thus required in any case in which the agreement or arrangement, in whole or in part, calls for the consultant to engage in persuader activities, regardless of whether or not advice is also given.

This new definition would thus require reporting with respect to a variety of drafting and training activities which previously fell within the advice exception. For a list of those activities, click here.

The Department’s stated rationale for this change is that undisclosed persuader activities are having a deleterious effect on the rights of workers and that greater reporting will help employees make a more informed choice as to whether to exercise their Section 7 rights. Organized labor supports increased reporting because it believes an employer will be less likely to hire an outside consultant to counter an organizing effort if it has to disclose that it has done so and the amount it pays for the consultant’s services.

The Department is accepting public comment on the proposed rules until August 22, 2011. For more information on the comment process, click here.
 

The New York State Department of Labor (“NYSDOL”) recently published additional guidance on compliance with the Wage Theft Prevention Act (“WTPA”). This guidance supplements the NYSDOL’s previously-issued templates, instructions and FAQs on the WTPA. Specifically, the NYSDOL recently published a “sample” paystub, demonstrating how employers should comply with the WTPA’s amendments to New York Labor Law Section 195(3). As we reported previously the amended Section 195(3), requires employers to include the following information in all employee paystubs:

• Dates of work covered by wage payment;
• Name of employee;
• Name of employer;
• Employer’s address and phone;
• Rate or rates of pay;
• Basis of rate(s) of pay (hourly, shift, day, week, salary, piece, commission or other);
• Gross wages;
• Deductions;
• Allowances, if any are claimed as part of the minimum wage (tips, meals, lodging); and
• Net wages. 

Additionally, the following information must be provided in paystubs for non-exempt employees:

• Regular hourly rate or rates;
• Overtime rate or rates;
• Number of regular hours worked; and
• Number of overtime hours worked.

Also, for employees paid by piece rates, their paystubs must include the applicable piece rates and the number of pieces completed at each rate.

The NYSDOL’s sample paystub provides only basic guidance on how the required information should be displayed for a non-exempt, hourly employee. It does not illustrate how this information should be displayed for other employee classifications, such as employees who earn multiple rates in a given pay period or employees who are paid, in whole or in part, by commission. The sample paystub can be accessed here. In addition to its sample paystub, the NYSDOL also recently issued a “Fact Sheet,” summarizing the WTPA and, among other things, its various notice and record-keeping requirements for employers. However, employers are not required to post this Fact Sheet, or to otherwise distribute the document to employees in any manner.

 

Over the last couple of years the New York State Department of Labor has issued several opinion letters which significantly narrow its interpretation of New York Labor Law Section 193, the law governing permissible deductions from wages. We have discussed some of these interpretations in prior posts. To summarize, NYSDOL  takes the position that a deduction from wages is not permissible unless it is a deduction which is similar to those expressly recognized in the statute as lawful, e.g. payments for insurance premiums, pension or health and welfare benefits. This interpretation varies from the Department’s historical focus on whether the deduction was for the “benefit of the employee.” Based on the newer standard, NYSDOL has rejected suggestions that an employer may make deductions from wages for items such as an overpayment of wages, parking, or for wage-linked card purchases of food at an employer-subsidized cafeteria.

The attack on deductions which are not similar to deductions for traditional employee benefits continued earlier this year when NYSDOL issued an opinion letter finding that deductions for overpayment of wages from a “paid time off” bank would also violate Section 193. In reaching this conclusion, the Department determined that paid leave time constitutes “wages,” so deducting from that time would be a deduction from wages covered by Section 193. Significantly, this interpretation runs counter to the long-time general rule in New York that an employer is required only to abide by the terms of its paid leave policy, because it is not required to provide paid time off at all. For example, “use it or lose it” polices are permissible in New York as long as the policy is clear and unambiguous. Under that rule, a paid time off policy which clearly states that accrued paid time off may be reduced by the amount of overpaid wages should also be permissible. NYSDOL’s most recent opinion letter on the subject serves as a reminder to employers that unless the deduction from wages is one that is actually listed in Section 193, the NYSDOL will probably view it as impermissible.

A recent decision from a United States District Court in Texas is a reminder of the risk created by an adverse employment action which follows closely in time the employer’s first knowledge of an employee’s disability or other protected characteristic. The situation where an employer learns of a disability, often through a leave request, just as it is about to impose discipline for performance problems or violations of policy is not at all uncommon. And it is very similar to the situation created when an employee who is about to be disciplined complains of discriminatory harassment. When such events occur, the employer is faced with a real dilemma: either impose the discipline and risk a retaliation or discrimination claim, or sit on the discipline for some undetermined period of time. Which course is best depends on a variety of facts and operational considerations. But one thing is certain. No action should be taken unless and until a complete and thorough investigation of the underlying performance issue or policy violation is completed. We have ridden the investigations hobby horse in other contexts. The Texas case plainly illustrates its importance in this context as well.

According to the Court’s opinion, a restaurant manager was discharged three days after he informed his supervisor that he had brain cancer and would need leave to seek treatment. The former manager sued for disability discrimination and for interference with his rights under the FMLA. The employer defended by arguing that it terminated the manager for improperly altering the time records of the employees who reported to him to deprive them of pay for time worked, a contention denied by the manager and at least some of the employees whose records were altered.

According to the Court’s opinion, which denied the employer’s motion for summary judgment, there were several holes in the employer’s argument. All of those holes were attributable to a poor investigation of whether the manager had in fact improperly altered time records to deprive employees of payment for time worked. For example, the Court noted that before the employer concluded the manager had committed a dischargeable offense, it never spoke to the employees whose records were altered, never spoke to the manager who altered the records, and never considered whether the time removed from the records was break time for which the employees failed to punch out. In addition, there was evidence suggesting that the plaintiff manager had been treated differently than other managers who engaged in the same conduct. Similar treatment for similar offenses is another basic principle of discharge and discipline investigations. All of these flaws could have been avoided through a proper investigation. The Court found that in light of these holes in the employer’s story, a reasonable jury could conclude that the employer did not have a good faith belief the manager had improperly altered time records, and could draw an inference of disability discrimination from the timing of the firing. That combination was enough to send the case to trial.
 

The subpoena power of the EEOC is very broad, and entitles the EEOC to obtain information relevant to its investigation of a charge of discrimination. But a federal district court recently concluded that there are limits to that power, and that it does not necessarily entitle EEOC to obtain information about corporate-wide policies or other potential claimants when the information sought will not shed light on the charge it is investigating.

The case arose when the former employee of a nursing home owned by the University of Pittsburgh Medical Center (“UPMC”) filed a charge of disability discrimination. According to the Court’s opinion, the nursing home responded to the charge by contending the former employee had been discharged pursuant to a policy which provided for a maximum medical leave of 14 weeks. The EEOC then served a subpoena on UPMC, not just the nursing home, demanding production of information on every UPMC employee, not just nursing home employees, terminated pursuant to the policy since July 1, 2008. UPMC has approximately 48,000 employees, the nursing home 170.
 

EEOC sought the information to investigate a corporate-wide application of the leave policy and to determine if there were other potential ADA claimants. The EEOC’s theory was that application of the policy could deprive employees of additional unpaid leave as a reasonable accommodation. UPMC objected to the subpoena and refused to comply, so EEOC sought to enforce the subpoena in court. The Court rejected that effort, concluding that the subpoena was an improper fishing expedition.

In reaching this conclusion, the Court relied on a 2010 decision from the United States Court of Appeals for the Third Circuit, EEOC v. Kronos, Inc., which holds that in order to be valid, an EEOC subpoena must seek information relevant to the charge under investigation. The Court noted that although the EEOC need not ignore facts that might be related to other claims of discrimination if it uncovers them during its investigation of a pending charge, the ability to pursue such facts does not give the EEOC “unconstrained investigative authority.” The information it seeks must still be relevant to the charge under investigation, and/or arise out of its investigation of the charge. The Court concluded that neither standard was satisfied in the case before it. The information was not relevant to the charge under investigation because the only reason EEOC wanted it was to conduct a broader investigation of UPMC’s corporate leave policy, and to find other potential claimants. EEOC offered no explanation of how the requested information might shed light on the charge under investigation. And the subpoenaed information did not arise out of the investigation of the charge, because it was clear from the facts that EEOC had not conducted any investigation of the facts related to the charge before issuing the subpoena.
 

Two recent cases show that whether the NLRB will issue a complaint in a case involving discharge for misusing social media may depend on the content of the “post” or “tweet.” In a departure from recent aggressive enforcement activity in the realm of social media, the National Labor Relations Board’s Division of Advice recently concluded that an Arizona newspaper’s termination of a crime and public safety beat reporter for inappropriate and offensive “tweets” was not a violation of federal labor law. According to the Division of Advice’s April 21, 2011 Advice Memorandum, The Arizona Daily Star had encouraged its reporters to open Twitter accounts and “tweet” on newsworthy stories to reach a greater audience and improve traffic to the newspaper’s website. The reporter opened an account, identified himself as a Daily Star reporter, and began “tweeting” on various subjects and stories. After posting a sarcastic remark about his “witty and creative” editors, he was instructed by management not to air his grievances or comment about the newspaper in any public forum. Although he abided by that restriction, he went on to post several crass and controversial tweets about his public safety beat, including the following: (i) “You stay homicidal, Tucson. See Star Net for the bloody deets[;]” and (ii) “What?!?!? No overnight homicide? WTF? You’re slacking Tucson.” He also posted a derisive tweet about the “stupid people” at a local TV station, prompting a complaint from the station to the Daily Star.

The newspaper suspended and eventually terminated the reporter based on these tweets. The termination notice stated that he had repeatedly disregarded guidance “to refrain from using derogatory comments in any social media forums that may damage the goodwill of the company.” The reporter responded by filing a charge with the Board, alleging that his termination violated his right to engage in protected “concerted activity for the purpose of…mutual aid and protection” under Section 7 of the National Labor Relations Act, which can include speech about the terms and conditions of employment. The case was submitted to the General Counsel’s Division of Advice for an opinion as to whether the termination had violated the Act.

In its Advice Memorandum, the Division of Advice found no violation because the reporter was terminated “for writing inappropriate and offensive Twitter postings that did not involve protected concerted activity.” In finding the tweets to be neither protected nor concerted, the Division of Advice noted they neither dealt with the terms and conditions of employment nor attempted to involve others in any employment-related issues. Significantly, the Division of Advice acknowledged that several warnings by management to the reporter against making negative public comments about the newspaper could be interpreted as unlawfully restricting Section 7 rights. The statements did not rise to the level of “orally promulgated, overbroad rules”, however, because they were communicated solely to the complaining reporter in the context of discipline and in response to specific misconduct, and were not communicated to other employees or published as new rules.

In contrast, earlier this month, the Board’s Regional Director for Region 3 issued a complaint against a not-for-profit organization, Hispanics United of Buffalo, Inc., in a case where several workers were allegedly discharged for postings made on one of the worker’s Facebook pages. There, unlike the Arizona Daily Star case, the communication at issue apparently contained direct references to employee terms and conditions of employment. According to a public statement about the case issued by the Board, one employee posted on her Facebook page a co-worker’s comments which were critical of employee performance generally. Other employees then responded to that post with comments which complained about workload and staffing issues. The employer discharged those employees, contending their comments were harassment of the co-worker mentioned in the initial post. The complaint alleges that the postings were protected concerted activity under Section 7 of the NLRA because they involved communications between co-workers about their terms and conditions of employment, including job performance and staffing levels.

As these two cases show, the application of federal labor law to employer-promulgated social media policies and rules is a new and rapidly evolving area of law. In fact, the Board’s Acting General Counsel recently issued a memorandum instructing all Regional Directors to submit all cases involving employer social media policies to the Division before taking any action because of the absence of precedent in the area and the policy issues involved. Given the Board’s heightened interest in safeguarding employees’ Section 7 rights against overbroad social media policies and the relatively uncharted territory at play, employers should seek the assistance of counsel before implementing or disciplining employees under such policies.
 

More than two years ago, the ADA Amendments Act (the “ADAAA”) of 2008 went into effect. The statute was designed to broaden the coverage of the Americans with Disabilities Act. Earlier this year, the EEOC issued long-awaited and much-debated final regulations to implement the ADAAA. In conjunction with the release of the regulations, the EEOC also released an appendix to the regulations containing examples, a fact sheet on the regulations, a question and answer document and a small business question and answer document.   The regulations are effective on on May 24, 2011.

The final regulations eliminate or change many of the more controversial proposed regulations to which employer representatives objected during the notice and comment period. One item which continues to cause controversy, however, is EEOC’s list of so-called “per se disabilities,” impairments that have been characterized as automatically qualifying as covered disabilities. EEOC has created this list through a series of rules of construction used to analyze whether a particular impairment is a disability. The regulations explain that in using these rules of construction, some impairments, such as epilepsy, diabetes, cancer and bipolar disorder, to name a few, will virtually always constitute disabilities. However, the regulations do provide that an individualized assessment is still required in every case.
 

Most of the new regulations, however, simply implement the ADAAA’s requirements. For example, the regulations provide certain rules of construction used to determine whether an individual is substantially limited in performing a major life activity, and therefore disabled under the Act. Those rules of construction range from the very general (the term substantially limits should be construed broadly in favor of expansive coverage and requires a lower degree of functional limitation than previously required by the courts), to the more specific (an impairment in remission is a disability if it would substantially limit a major life activity when active).

Questions about whether and how a particular major life activity might be substantially limited, including the major life activity of working, are addressed not in the regulations themselves, but in an appendix to the regulations. The EEOC notes that given the significant changes in the definition of disability made by the ADAAA, it will rarely be necessary to determine whether an individual is substantially limited in the major life activity of working.

Consistent with the ADAAA, the new regulations expand coverage under the “regarded as” prong of the statute, focusing on the employer’s treatment of the individual, rather than whether the employer believed the individual had a substantially limiting disability. The question becomes whether the employer took a prohibited action because of an actual or perceived impairment that is neither transitory nor minor. As a result of this redefinition of the “regarded as” prong, the new regulations note that proceeding under this prong will be sufficient for most complainants, the most significant exception being cases where the employee claims he or she was denied a reasonable accommodation. In those cases, the employee will have to proceed under the actual disability or record of disability prongs.
 

The U.S. Supreme Court’s recent decision in Staub v. Proctor Hospital is a timely reminder of the importance of conducting thorough and objective workplace investigations. By holding that an employer may be liable based on the discriminatory animus of a supervisor who influenced, but did not ultimately make, an adverse employment decision, the case resolves a split in the various U.S. Circuit Courts of Appeals concerning the so-called “cat’s paw” theory of discrimination.

Staub, an Army Reservist, sued his former employer under the Uniformed Services Employment and Reemployment Rights Act (USERRA), arguing that his termination was caused by his supervisor’s obvious hostility to his military obligations. Although the ultimate decision maker was not similarly biased, the plaintiff argued that the employer was nevertheless liable under a “cat’s paw” theory: that the unbiased supervisor was the dupe or tool of the biased supervisor. The Seventh Circuit Court of Appeals rejected the plaintiff’s argument and dismissed the case on summary judgment. The Supreme Court reversed, ruling that an employer can be liable under a “cat’s paw” theory if it can be shown that the supervisor’s bias was a proximate cause of the challenged employment action. The case was remanded to the lower court for further consideration.
 

In its decision, the Supreme Court specifically considered the effect internal investigations may have on employer liability in “cat’s paw” cases. It noted that liability may be avoided in some instances if the employer can demonstrate that the adverse action followed an independent investigation that was not tainted by the biased supervisor’s recommendation. If, however, the investigation takes into account the biased supervisor’s recommendation without independently determining that the ultimate adverse action was justified, the biased supervisor’s recommendation remains a causal factor, opening the door to liability.

In light of the Staub decision, it is critical that employers review their workplace practices to ensure that internal investigation are conducted in a thorough and objective manner. Click here for a few tips on conducting effective investigations.

Diane M. Pietraszewski contributed to this post.
 

On Monday, the United States Department of Labor (DOL) released a smartphone App that is essentially a timesheet to help employees independently track the hours they work and determine the wages they are owed. The App is available here.

With this App (available in English and Spanish), employees can track regular work hours, break time and any overtime hours. As promoted by the DOL - "This new technology is significant because, instead of relying on their employers’ records, workers now can keep their own records. This information could prove invaluable during a Wage and Hour Division investigation when an employer has failed to maintain accurate employment records."
 

While this App is currently compatible with only the iPhone and iPod Touch, the DOL plans to explore updates that could enable similar versions for other smartphone platforms, such as Android and BlackBerry, and other pay features not currently provided for, such as tips, commissions, bonuses, deductions, holiday pay, pay for weekends, shift differentials and pay for regular days of rest.

While this may seem inconsequential to some employers, bear in mind that in wage and hour audits/litigation, employees routinely seek to undermine the validity of employer time records by asserting that the employer's time records are inaccurate or that supervisors have instructed them to falsify their time records. Should the employee succeed in advancing such an allegation and make use of this new App, the DOL (in its current employee-focused mindset) would undoubtedly turn to the employee's time records and may rely on them to establish the actual hours worked by the employee.
 

Recently, the United States Department of Labor’s Wage and Hour Division (“DOL”) published final revisions to its Fair Labor Standards Act (“FLSA”) regulations. The long-awaited amendments, which became effective on May 5, 2011, are based on a proposed rule originally published in the Federal Register on July 28, 2008. For the most part, the final rule does not impose new requirements on employers, but instead clarifies existing rules and changes outdated information.

Some of the more noteworthy amendments relate to “tipped” employees. Specifically, the final rule clarifies that: (1) tips are the property of the employee, whether or not the employer has taken a tip-credit; (2) the employer is prohibited from using an employee’s tips for any reason other than a tip-credit or a valid tip pool; and (3) prior to utilizing the tip-credit, the employer must inform its tipped employees of the tip-credit requirements contained in section 3(m) of the FLSA. The final rule also clarifies that a valid tip pooling arrangement may only include those employees who customarily and regularly receive tips, even if the employer takes no tip-credit and instead pays the tipped employee the full minimum wage. The amendments further state that while the FLSA does not impose a maximum contribution percentage on mandatory tip pools, an employer must notify its employees of any required tip pool contribution amount and may only take the tip-credit for the amount of tips each employee ultimately receives.
 

The final rule also revises the overtime regulations to exclude stock options from the computation of the regular rate of pay. This change reflects the amendments to the FLSA made by the Worker Economic Opportunity Act of 2000. The regulations also reflect provisions of the Small Business Job Protection Act of 1996, by permitting employers to pay an hourly “youth opportunity” wage of $4.25 per hour to employees under the age of 20 during the first 90 consecutive calendar days of their employment. The revised regulation, like the statutory language on which it is based, explicitly prohibits employers from displacing employees or reducing hours in order to hire workers at the youth opportunity wage rate.

The regulatory package is also noteworthy for the proposals rejected by the DOL, including a proposed change which would have made the fluctuating workweek method of calculating overtime compatible with the payment of bonuses and premiums; a proposal allowing employers to apply a meal credit toward an employee’s minimum wage, even where the meal was not actually accepted; and a provision clarifying whether and how service advisers working for dealerships can qualify for an exemption under the FLSA. The DOL also declined to include specific examples clarifying an employer’s obligation to compensate employees for time spent commuting to and from work in an employer-supplied vehicle.
 

Does this sound familiar? An employee fired for cause, who is either unable or unwilling to accept responsibility for his/her own poor performance, commences litigation claiming unlawful discrimination. The pending litigation forces the employer into a Morton’s Fork dilemma of either: (1) paying an in terrorem settlement to avoid the exorbitant costs of discovery, subsequent motion practice and potential trial; or (2) incurring the exorbitant costs of discovery, subsequent motion practice and potential trial to hopefully win the case several years down the road.

Unfortunately, this scenario has become all too familiar to employers. Until recently, the predicament facing employers has largely been a function of the ease with which a would-be plaintiff employee may patch together a complaint and survive a motion to dismiss. Indeed, forcing an employer into time consuming and expensive litigation has been merely a matter of asserting the following conclusory, false syllogism: (1) I am a member of a protected class (as is literally everyone); (2) I was terminated from my job; (3) therefore, I was terminated from my job because I am a member of a protected class.

Fortunately, however, two recent cases from federal courts in New York may evidence an emerging trend of taking a more favorable view of motions to dismiss in employment discrimination cases, a trend that may help employers avoid the difficult choice between settling early or enduring the expense of prolonged litigation 

In Zucker v. Five Towns College, the plaintiff was a 69 year old college admissions recruiter. After being terminated by the College, Mr. Zucker sued alleging unlawful age discrimination. While the College sought dismissal of Mr. Zucker’s claims by filing a pre-answer motion to dismiss, Mr. Zucker tried to avoid dismissal by arguing that the mere fact his replacement was younger than him was sufficient to entitle him to discovery. Citing the College’s arguments, United States District Judge Joanna Seybert rejected Mr. Zucker’s argument. Judge Seybert held that in order to survive a motion to dismiss, a plaintiff is required to plead concrete facts demonstrating that the employment decision was motivated by discriminatory animus as opposed to what could be a whole array of legitimate considerations. Judge Seybert also held that being replaced by someone outside of the plaintiff’s protected class does not, standing alone, salvage a claim:

[I]f such barebones allegations sufficed to state a claim, then any time an ADEA-covered employer terminated an employee over age forty, the employer would be unable to replace that employee with someone younger without exposing itself to potential liability for age discrimination. And Defendants similarly argue, correctly noting that every employee is a member of multiple protected classes. Thus, unless a terminated employee is being replaced by a virtual clone, his/her replacement will almost certainly be outside of one of the Plaintiff’s protected classes (e.g., could be younger and/or a different gender, race, religion, national origin). The Court agrees with this reasoning. And the Court has no desire to abrogate [Federal Rule of Civil Procedure] 8’s gate-keeping function in employment discrimination cases, enabling nearly every fired employee to subject his employer to burdensome, expensive discovery.

More recently, and relying on Judge Seybert’s decision in Zucker, Judge Colleen McMahon in the Southern District of New York granted a motion to dismiss a race discrimination claim in Ochei v. Mary Manning Walsh Nursing Home Co. Judge McMahon specifically rejected the “false syllogism” that a decision to terminate someone’s employment necessarily flows from his/her protected class. Rather, according to Judge McMahon, the complaint must plead specific facts demonstrating the causal connection between the adverse action and the protected class:

Where there is no reason to suspect that an employer’s actions had anything to do with membership in a protected class, other than plaintiff’s bald assertion that she was a member of such a class, and the people who made decisions about her employment were not, no claim is stated. 
                                                                              ***
To protect employers from precisely this sort of untenable situation, naked assertions by plaintiff that some protected demographic factor motivated an employment decision, without a fact-specific allegation of a causal link between defendant’s conduct and the plaintiff’s membership in a protected class, are simply too conclusory to withstand a motion to dismiss.

The decisions in Zucker and Ochei should give employers pause before quickly settling cases or plowing straight into expensive discovery. While a pre-discovery motion to dismiss may not always be available, such a motion should be given careful consideration.

Jessica Satriano contributed to the writing of this post.