The Mid-Year Update: More People Doing Bad Things That You Shouldn’t Do…

1. The Mid-Year Update: More People Doing Bad Things That You Shouldn’t Do… Joseph A. Ernst, Esq.

2. In the News Trump appointed another conservative to the Ninth Circuit – the liberal Ninth Circuit is no longer liberal? Eric Miller, Appellate Chair of Perkins Coie, replaces Judge Tallman. Unprecedented appointment procedure. But may be good news for employers.

3. Mount Lemmon Fire Dist. v. Guido, 139 S. Ct. 22 (2018) The question presented before the Supreme Court – Does the ADEA’s numerosity specification (20 or more employees), applicable to “a person engaged in an industry affecting commerce,” apply to state entities? • The Court ruled it does not. • Analyzed statutory language – the statute establishes two separate categories: 1) persons engaged in an industry affecting commerce and 2) States or political subdivisions. • “[T]wenty or more employees” is confining language tied only to the first category.

4. Pratt v. Dep't of Pub. Safety(D. Haw. Nov. 8, 2018) • Plaintiff worked as a Deputy Sheriff for the Department of Public Safety from 2002 until 2017. • Plaintiff claims to have been repeatedly and frequently sexually harassed by fellow deputy sheriffs due to his sexual orientation. • E.g., they would call him by female-gender names, scorn him, and ridicule him for not dating women. They humiliated him by displaying homophobic behavior toward him.

5. Pratt v. Dep't of Pub. Safety(D. Haw. Nov. 8, 2018) The issue – is “sexual orientation” a protected class status under Title VII? • Ninth Circuit has not yet weighed in on the question. • The Second and Seventh Circuits, as well as the EEOC, have recognized sexual orientation as a protected class. The District of Hawaii ruled yes, it is. • However, plaintiff failed to allege sufficient facts for the adverse employment action allegation. Thus, plaintiff was granted the leave to amend his complaint.

6. Grant v. Marriott Ownership Resorts, Inc.(D. Haw. Nov. 21, 2018) • Plaintiffs Grant, Kelly, and Reisinger worked for Marriott as timeshare sales executives at its Ko Olina location. • They alleged certain non-Caucasian sales executives were treated more favorably than them. • Non-Caucasian sales executives were allowed to review lists of potential tours and “cherry-pick” the tours that were believed to be easier sales. • The front desk employees who assigned tours primarily gave favorable treatment to Vuong, Quach, and Wong, all of whom are non-Caucasian. • The term “haole” was used at the workplace in a negative manner on a daily basis. • The front desk employees were hostile towards Kelly and Reisinger.

7. Grant v. Marriott Ownership Resorts, Inc. (D. Haw. Nov. 21, 2018) • Further, derogatory comments were frequently made about Indians and African Americans. • For example, Vuong would make comments about African Americans raping women, and when a new hire, who was African American, said he went by “KK,” Vuong told him: “‘Oh yeah, well I go by KKK’ and did a Hitler salute.”  • Kelly recalled one morning meeting when “every conceivable name for an Indian was thrown out by many sales executives as if it was a competition,” including “Dothead, towelhead, sandni**er, etc.” • Kelly’s supervisor would also comment about how she dressed, and would tell her to smile more, be more “girlie,” and be more friendly. The other sales executive would state Kelly should dress more provocatively. An unidentified person stated she was flat chested. Plaintiffs sued Marriott Vacations Worldwide for being terminated based on their race and/or sex in violation of Title VII, HRS § 378-2, and HRS § 378-62.

8. Grant v. Marriott Ownership Resorts, Inc. (D. Haw. Nov. 21, 2018) Race discrimination: • The court found Plaintiffs have submitted sufficient evidence to show they were qualified for their positions: in the first quarter of 2014, Kelly was among the top ten sales executives; when Reisinger worked at other Marriot locations prior to transferring, she had successful sales, received promotions and awards, and took on other duties, including training other sales executives and being a mentor to new sales executives; Grant was periodically among the top one or two sales executives. • The court found Marriot has articulated legitimate nondiscriminatory reason for the termination of each plaintiff: each plaintiff received three written warnings in the proceeding twelve months, based on their performance and attendance issues.

9. Grant v. Marriott Ownership Resorts, Inc. (D. Haw. Nov. 21, 2018) • Pretext evidence – sufficient: • Plaintiffs’ immediate supervisor, stated, “it’s a matter of time before we get rid of all the haole people.” Within a month of this statement, each plaintiff received notice of his or her suspension pending separation. • The evidence suggested manipulation of tour assignments to favor certain sales executives and to place Caucasian sales executives at a disadvantage. • Mr. Her said Grant could not get more of the good tours because Grant's “‘skin [wa]s the wrong color.’” • Another Caucasian former sales executive once asked why he was assigned so many bad tours, Ms. Chamizo – the front desk manager – responded: “‘Sucks to be Haole.’”

10. Grant v. Marriott Ownership Resorts, Inc. (D. Haw. Nov. 21, 2018) Also upheld racially hostile work environment claim: Plaintiffs presented evidence that the term “haole” was used at the workplace in a negative manner on a daily basis, including to exclude Caucasians or to characterize Caucasians as stupid. The derogatory comments about Caucasians would be considered in the context of the derogatory comments about African Americans and Indians because they show a general hostility toward certain races.

11. Grant v. Marriott Ownership Resorts, Inc. (D. Haw. Nov. 21, 2018) In contrast – Sex discrimination failed: • Evidence: Kelly’s supervisor’s and other sales executives’ comments about her demeanor, her attire. • However, the court ruled even when viewed in the light most favorable to Kelly, the comments do not raise a genuine issue of fact as to pretext, as none of the comments related to her termination. Sexually hostile work environment claim failed: • The court found the comments were merely “simple teasing and offhand comments” that did “not amount to discriminatory changes in the terms and conditions of employment.” 

12. Wunderlin v. AB Car Rental Servs., Inc.(D. Haw. Oct. 18, 2018) • Plaintiff, a Caucasian male, worked at Defendant's Kailua-Kona Airport location from 2008 until his termination in 2015. • Plaintiff's first supervisor was a Caucasian male, who was replaced around 2013/14 by Inda, a Filipino male.   • Winkleman, a Caucasian male, was Defendant's operations manager. According to Winkleman, Inda instructed him to monitor and keep separate files of customer complaints against Plaintiff and Kevin Ditty, another Caucasian male. Inda did not tell Winkleman to monitor or keep files of anyone else.

13. Wunderlin v. AB Car Rental Servs., Inc.(D. Haw. Oct. 18, 2018) • Between 2008 and 2015, Plaintiff received approximately a dozen warnings for violations of work rules, e.g., defrauding customers, charging customers for upgrades and coverages without their consent. • A state agency performed an audit at the Kailua-Kona Airport location, and an inspector allegedly witnessed Plaintiff lying to a customer and adding insurance to a purchase after the customer declined such insurance. • Defendant suspended Plaintiff and issued him a final written warning for violating company policy. Plaintiff had received a total of fifteen customer complaints prior to his suspension. • Three months prior to his suspension, Plaintiff informed Inda and a HR employee that he believed his reprimands and suspension were the result of race discrimination. 

14. Wunderlin v. AB Car Rental Servs., Inc.(D. Haw. Oct. 18, 2018) • Plaintiff described racial tension in the workplace, and multiple instances of the derogatory use of the word “haole.” • Defendant conducted an investigation. However, it determined that there had been no race-based misconduct by any of Plaintiff's coworkers.  • Upon his return from suspension, Plaintiff received seven more customer complaints. • Plaintiff was subsequently terminated.

15. Wunderlin v. AB Car Rental Servs., Inc.(D. Haw. Oct. 18, 2018) Race discrimination: • The Court found that plaintiff had not provided direct evidence that a discriminatory reason more likely than not motivated Defendant's termination decision.   • But plaintiff has provided circumstantial evidence of discriminatory animus. For example, Plaintiff alleged that Ditty heard Inda say, “These haoles make all the money.” • Similarly situated persons: plaintiff contends that Defendant did not terminate Flores, a non-Caucasian sales person who received similar customer complaints. The court ruled plaintiff failed to show that Flores received favorable treatment –Flores received multiple warnings and was suspended. Then he quit. Flores simply did not work long enough after his final warning for Defendant to contemplate terminating him.

16. Wunderlin v. AB Car Rental Servs., Inc.(D. Haw. Oct. 18, 2018) Race discrimination: • If a plaintiff cannot show evidence that a similarly situated employee outside the plaintiff's protected class was treated more favorably, he or she can still establish the prima facie case by providing evidence that “other circumstances surrounding the adverse employment action give rise to an inference of discrimination.” • Here, plaintiff has provided sufficient circumstantial evidence that could give rise to an inference of discrimination: Inda purportedly commented that “haoles make all the money.” Winkleman also indicated that Inda told him to keep separate files only on Plaintiff and Ditty, who were the two high-earning Caucasian males working at the Kailua-Kona location. • Ruled defendant provided a nondiscriminatory reason for plaintiff's firing: the numerous and repeated customer complaints against plaintiff. 

17. Wunderlin v. AB Car Rental Servs., Inc.(D. Haw. Oct. 18, 2018) Pretext – established: • Plaintiff highlights the section of his termination letter stating he was fired, in part, because he did not tell a customer that insurance was optional.  He contends that he was not obligated to do so, and points to evidence that Defendant “does not require the RSA to state products are ‘optional’ up front.”  This would certainly allow a jury to reasonably conclude that the support for Plaintiff's termination was pretextual. • Ditty heard Inda say that haoles make all the money; Winkleman was directed to monitor and keep separate files of customer complaints on Ditty and Plaintiff; and Winkleman was not required to scrutinize Flores, even though he too received customer complaints. • Plaintiff thus showed an indication of a racial motivation for the monitoring, and a potential racial motivation for Inda reporting to his superiors about Plaintiff's performance.

18. Wunderlin v. AB Car Rental Servs., Inc.(D. Haw. Oct. 18, 2018) In contrast, under the same set of facts, hostile work environment claim didn’t fare well: • The Hawai'i Supreme Court conducts a “severe and pervasive” inquiry that differs slightly from the Ninth Circuit test.  • It is the harasser's conduct which must be severe or pervasive, not its effect on the plaintiff or the work environment.” • Although he claims his coworkers often used the word “haole,” he points to only two isolated incidents when supervisors heard coworkers use the word.   • Plaintiff's allegations do not demonstrate “severe and pervasive” conduct that created a hostile work environment.

19. Nunies v. HIE Holdings, Inc., 908 F.3d 428 (9th Cir. 2018) • Plaintiff alleges he injured his shoulder and wanted to transfer to a part-time, less-physical job. The transfer was initially approved by the employer. • Then plaintiff told the employer about his shoulder injury. • Two days after, the employer rejected his transfer request and forced him to resign. • Plaintiff was told that the part-time job no longer existed because of budget cuts. • However, the employer advertised an opening for the exact same position just days afterwards. • Plaintiff sued for disability discrimination under ADA and HRS § 378-2.

20. Nunies v. HIE Holdings, Inc., 908 F.3d 428 (9th Cir. 2018) Disability discrimination – “regarded as” standard • In 2008, Congress enacted the ADA Amendments Act (“ADAAA”), which broadened the definition of disability under the ADA. • The ADAAA discarded the requirement that an impairment had to substantially limit a major life activity for the discrimination to be actionable under the “regarded as” prong. • But the ADAAA does require that an impairment not be “transitory” or “minor.” • However, the “transitory and minor” exception is an affirmative defense, and thus the employer bears the burden of establishing the defense.

21. Nunies v. HIE Holdings, Inc., 908 F.3d 428 (9th Cir. 2018) • Employer offered no evidence to sustain its burden that plaintiff’s actual or perceived injury was “transitory and minor.” • Evidence that employer lied to plaintiff about the availability of the part-time position raises the reasonable inference that the employer withdrew its transfer offer based on an illicit reason. Ninth Circuit reversed District court’s granting of employer’s summary judgment. Because Hawaii applies the same framework to claims of discrimination under the ADA to claims under HRS § 378-2, the court also reversed the dismissal of HRS § 378-2 discrimination claim.

22. Equal Employment Opportunity Comm'n v. BNSF Ry. Co.(9th Cir. 2018) • Holt received a conditional job offer from BNSF Railway Company (“BNSF”) for the position of Senior Patrol Officer, contingent on Holt’s satisfactory completion of a post-offer medical review. • During that medical review, Holt disclosed that he had injured his back four years before, suffering a two-level spinal disc extrusion. • Holt’s primary care doctor, his chiropractor, and the doctor BNSF’s subcontractor hired to examine Holt all determined that Holt had no current limitations due to his back and found no need for follow-up testing. 

23. Equal Employment Opportunity Comm'n v. BNSF Ry. Co.(9th Cir. 2018) • Yet as an effective condition to consider him further for the job, BNSF demanded that Holt submit an MRI of his back – at his own cost – or it would treat Holt as having declined the offer. • Holt was in bankruptcy at that time and did not obtain an MRI. • BNSF revoked Holt’s job offer.  The court applied the ADAAA’s “regard as” standard to determine whether Holt was “disabled” for purpose of federal disability discrimination law.

24. Equal Employment Opportunity Comm'n v. BNSF Ry. Co.(9th Cir. 2018) “Regarded as” • In requesting an MRI because of Holt’s prior back issues and conditioning his job offer on the completion of the MRI at his own cost, BNSF assumed that Holt had a “back condition” that disqualified him from the job unless Holt could disprove that proposition. • And in rejecting Holt’s application because it lacked a recent MRI, BNSF treated him as it would an applicant whose medical exam had turned up a back impairment or disability. BNSF chose to perceive Holt as having an impairment. Thus, Holt was “disabled” under the “regarded as” standard.

25. Equal Employment Opportunity Comm'n v. BNSF Ry. Co.(9th Cir. 2018) Next question – Whether BNSF discriminated against Holt because of his perceived impairment. Specifically, whether it was permissible for BNSF to condition Holt’s job offer on Holt obtaining an MRI at his own expense.  • An employer would not run afoul of ADA if it required that everyone to whom it conditionally extended an employment offer obtain an MRI at their own expense.  • Imposing a cost across-the-board • However, when an employer requests an MRI at the applicant’s cost only from persons with a perceived or actual impairment or disability, the employer is discriminating a person with a disability because of that person’s disability. • Given the indisputably high cost of MRIs, requiring an MRI as a condition of employment will for many individuals mean a disqualification from participating in the process.

26. Crowley v. Wal-Mart Stores, Inc.(D. Haw. Sept. 11, 2018) • Plaintiff was the store manager at Hilo Wal-Mart store. • He injured his left ankle when serving in the Navy.He was 63 years old when he filed the complaint. • In 2013 Armijo became Hawaii Market Manager and plaintiff’s direct supervisor. • Armijo, upon seeing Crowley walking with a cane and boot, asked on several occasions whether Crowley was still able to run the store.  • Being able to walk around the store was an essential function of Crowley's store manager job.  • In July 2011, a Target store opened near the Hilo Wal-Mart, after which sales at the Hilo Wal-Mart declined about 15%.  • After Hilo Wal-Mart store received several “poor” ratings during the annual surveys conducted among the store employees, in 2014 Armijo gave three coachings to plaintiff regarding his deficiencies and set a 30-day clock in which plaintiff was to correct the deficiencies or be potentially terminated.

27. Crowley v. Wal-Mart Stores, Inc.(D. Haw. Sept. 11, 2018) • Plaintiff responded by saying he would file a complaint of discrimination for the discriminatory comments and actions concerning his age and his injury over the course of the last 18 months Armijo had been his supervisor. • Due to Hilo Wal-Mart’s poor ratings, Wal-Mart management conducted “engagement visits” to the Hilo store. During the visits, the inspection team discovered safety issues on the power lifting equipment and deficiencies with the procedures for documenting servicing and condition of the equipment. • Wal-Mart terminated plaintiff shortly afterwards. • Plaintiff sued Wal-Mart for age and disability discrimination.

28. Crowley v. Wal-Mart Stores, Inc.(D. Haw. Sept. 11, 2018) Age discrimination: • The only specific discriminatory comments concerning plaintiff’s age was an alleged statement in 2012 by his co-worker that “old people like you have a difficult time understanding new concepts, technology, like computers.”  • The court ruled this comment cannot support plaintiff’s ADEA claim because the co-worker transferred to a different position with Wal-Mart in 2013 and played no role in what happened to plaintiff thereafter.  

29. Crowley v. Wal-Mart Stores, Inc.(D. Haw. Sept. 11, 2018) Disability discrimination: • Plaintiff points to Armijo's comments about whether he was physically able to perform his job as store manager. • Armijo, who participated in the termination of Crowley, may have regarded Crowley as disabled.  • At the summary judgment stage, the requisite degree of proof necessary to establish a prima facie case is minimal and does not even need to rise to the level of a preponderance of the evidence. • A single discriminatory comment by a plaintiff's supervisor or decisionmaker is sufficient to preclude summary judgment for the employer. • The court ruled that such comments, combined with Armijo's role in terminating plaintiff, are circumstantial evidence that Armijo may have discriminated against plaintiff based on his disability.

30. Crowley v. Wal-Mart Stores, Inc.(D. Haw. Sept. 11, 2018) Disability discrimination: • Wal-Mart came up with a legitimate, nondiscriminatory reason for terminating plaintiff – as the Hilo store manager, he was responsible for the safety of the store's employees but he failed that. • Pretext – a potentially bigoted comment is not a “stray remark” • Whether Armijo's comments about plaintiff’s ability to do his job indicate discriminatory animus is for the jury to decide. • While the evidence is hardly overwhelming, a jury might well decide that Armijo sought to terminate plaintiff because Armijo believed he was too disabled to revive the Hilo Wal-Mart store, and that terminating him because of issues with power lifting equipment was simply a pretext for disability.

31. BCI Coca-Cola Bottling Co. of Los Angeles, Inc. v. Hoshijo(Haw. Ct. App. 2018) • Coca-Cola Bottling Company of Los Angeles, Inc. (BCI) is the former employer of Tammy Josue. • Josue suffered a work injury while employed by BCI and was placed on disability leave. • After Josue was on disability leave for over ten months, BCI hired a permanent replacement for Josue's pre-work-injury position. • Josue later sought to return to her pre-work-injury position at BCI, but BCI refused to reinstate her to her former position because it had been filled. • BCI offered a number of other positions to Josue, but Josue declined because she believed that those positions were downgrades or positions for which she was not qualified.

32. BCI Coca-Cola Bottling Co. of Los Angeles, Inc. v. Hoshijo(Haw. Ct. App. 2018) HRS § 378-32(a)(2) states “It shall be unlawful for any employer to suspend, discharge, or discriminate against any of the employer's employees . . . [s]olely because the employee has suffered a work injury which arose out of and in the course of the employee's employment with the employer . . . unless the employee is no longer capable of performing the employee's work as a result of the work injury and the employer has no other available work which the employee is capable of performing.”

33. BCI Coca-Cola Bottling Co. of Los Angeles, Inc. v. Hoshijo(Haw. Ct. App. 2018) “Solely because” The DLIR has not defined the term for the purposes of HRS § 378-32(a)(2). “Solely,” as commonly understood, means “to the exclusion of alternate or competing things.” Other prohibition provisions in the Chapter 378 do not contain “solely.” Thus,  HRS § 378-32(a)(2) is more precise and more restrictive than found elsewhere in the chapter. Held – the statute is not ambiguous and requires that the work injury be the sole cause of the adverse employment action to run afoul of HRS § 378-32(a)(2).  • It should, of course, be recognized that employment decisions are often complicated. Thus, the fact-finder should closely scrutinize the facts and discern the genuine motivations in alleged discriminatory behavior.

34. BCI Coca-Cola Bottling Co. of Los Angeles, Inc. v. Hoshijo(Haw. Ct. App. 2018) Pretext? • BCI decided to replace Josue with a permanent employee because Josue's prolonged absence was creating a hardship for the department, over ten months after Josue went out on leave.  • BCI did not learn until about fifteen months after Josue's injury that Josue was released to work. By that time, Josue’s pre-work-injury position had been filled. • There is no finding that BCI's business hardship justification for filling Josue's position was pretextual.  Neither the language of the statute nor its legislative history suggest that employers are required to either leave a vacated position open or hire temporary employees to replace an injured employee who may be unable to return to their previous employment for lengthy periods of time. Certiorari granted by the Hawaii Supreme Court.

35. Maybin v. Hilton Grand Vacations Co., LLC (D. Haw. 2018) • Maybin interviewed for a timeshare sales agent position with Hilton in 2015 when he was 55 years old. He was subsequently hired. • He interviewed with Montenegro, a senior member of Hilton's Human Resources department, and Kannel, the Director of Sales. • Based upon Kannel's recommendation and request, Montenegro hired Maybin. • When Maybin failed to meet sales quotas for several consecutive months, he was subject to progressive written warnings, and then eventually terminated by Montenegro, at Kannel's recommendation.  • Maybin filed age discrimination claim, alleging shortly after he was hired, Kannel demonstrated animus towards older sales agents by making negative comments about their abilities at sales meetings. • For example, Kannel said older agents “were too slow, can't learn, have a different way of doing things, are hard to teach new ways of sales, are too old to change, and don't have the energy necessary for sales.”

36. Maybin v. Hilton Grand Vacations Co., LLC (D. Haw. 2018) Same Actor Inference – If the same person with decision-making authority is responsible for both hiring and firing of a discrimination plaintiff, this gives rise to inference that no discrimination has occurred. • The inference may arise when the favorable action and termination are as much as a few years apart. • Then plaintiff can only prevail if he makes the extraordinarily strong showing of discrimination required to rebut the “same actor inference.” Because Hilton has sufficiently established that Montenegro, at Kannel's recommendation, was the same decisionmaker who hired and fired Maybin within a short period of time, the same actor inference creates an inference of no age-based animus or discriminatory motive.

37. Maybin v. Hilton Grand Vacations Co., LLC (D. Haw. 2018) Maybin failed to rebut the inference: • The statements attributed to Kannel and offered to show age-based animus do not, without much more, satisfy the strong showing of discrimination necessary to overcome the same actor inference. • Kannel purportedly said “the older agents, including [Maybin], were too slow, can't learn, have a different way of doing things, are hard to teach new ways of sales, are too old to change, and don't have the energy necessary for sales.” • They don’t evince an extraordinarily strong showing of bias based upon Maybin's age, especially because these comments are not linked directly to his termination.

38. Whitmire v. Wal-Mart Stores Inc. (D. Ariz. 2018) • In the 2010 general election, Arizona voters enacted the Arizona Medical Marijuana Act (“AMMA”) by ballot initiative. • Whitmire was a customer service supervisor at Wal-Mart, and she was prescribed medical marijuana. • She said she used it as a sleep aid and to treat chronic pain tied to arthritis and a shoulder surgery, but had never come to work impaired. • She missed a day of work to go to urgent care for having injured her wrist at work. Then Wal-Mart required her to take a drug test, which came up positive for marijuana. • She was terminated because Wal-Mart believed she had been impaired at work. • She sued Wal-Mart for violations of the AMMA, the Arizona Civil Rights Act, the Arizona Employment Protection Act.

39. Whitmire v. Wal-Mart Stores Inc. (D. Ariz. 2018) Wal-Mart’s defense: • Arizona’s Drug Testing of Employees Act (“DTEA”) exempts an employer from liability for “actions based on the employer’s good faith belief that an employee had an impairment while working while on the employer’s premises or during hours of employment.” However, the only proof Wal-Mart provided that Whitmire was “impaired” was a human resources staff's interpretation of drug test results. The HR employee described the test results as “so positive that it was above what the test could measure.” Held: AMMA’s anti-discrimination provision creates an implied private cause of action. Without proper expert testimony, Wal-Mart failed to prove that Whitmire’sdrug screen showed marijuana metabolites or components in a sufficient concentration to cause “impairment.” Thus, Wal-Mart did not have a “good faith basis” to believe Whitmire was impaired at work.

40. Mahalo! And Behave Until August… Questions? Email me: jae@torkildson.com