Friday, January 20, 2012

Ninth Circuit Revives the Employee Friendly, Burden Shifting Standard Known as the McDonnell Douglas Test to Age Discrimination in Employment Act (ADEA) Summary Judgment Motions

With 11 percent-high unemployment rate in California an increasing number of older workers are being laid off and are competing for jobs with younger applicants.  In this economic climate, with the age-bias stereotypes that some older workers already confront, it is not surprising that the number of age discrimination complaints being filed is at a record high. However, the road from filing a complaint with the Equal Employment Opportunity Commission (EEOC) to winning a case is not easy under the Age Discrimination in Employment Act (ADEA).

The Age Discrimination in Employment Act protects individuals who are 40 years of age or older from employment discrimination based on age. Under the ADEA, it is unlawful to discriminate against a person because of his/her age with respect to any term, condition, or privilege of employment, including hiring, firing, promotion, layoff, compensation, benefits, job assignments, and training.  It has always been the plaintiff’s burden to prove discriminatory treatment in an ADEA claim.  Numerous frameworks have been established by the U.S. Supreme Court for proving discriminatory treatment.

Some of these frameworks are employee friendly, such as the McDonnell Douglas burden shifting framework. Under the McDonnell Douglas burden shifting framework, a plaintiff would first have to establish a prima facie case of discrimination. If successful, the burden of production shifts to the employer to articulate a legitimate non-discriminatory reason for its action. It is then the plaintiff’s task to demonstrate that the employer’s justification is merely a pretext for behavior actually motivated by discrimination. The McDonnell Douglas framework was initially applied to a Title VII mixed motive employment discrimination case. Since its inception in 1973, many federal courts adopted the framework to employment discrimination claims brought under other federal laws, including the ADEA.

Other frameworks make it tougher for plaintiffs to prevail, such as the “but for” test.  Under the “but for” test, a plaintiff must show by a preponderance of the evidence that the employer would not have acted that way it did but for the employee’s age. Under this test, the employer does not need to show that it would have made the same decision regardless of age.

In 2009, the U.S. Supreme Court in Gross v. FBL Financial Services, Inc., 557 U.S. 167 (2009), rejected the application of the employee friendly McDonnell Douglas framework to the ADEA and instead applied the “but-for” test. This decision was a victory for employers because the “but for” standard of causation is a far more stringent requirement than the mixed motive standard used in most discrimination cases.

Last week, with the Ninth Circuit’s decision in Shelley v. Geren, No. 10-35014 (9th Cir. Jan. 12, 2012), the pendulum began to slowly swing back to the employees’ side. The Ninth Circuit read Gross narrowly to apply only to cases that had already progressed to trial. The Court overturned the District Court’s decision to apply the employer friendly, strict “but-for” test to a motion for summary judgment in an ADEA claim. Instead, the Ninth Circuit held that in a mixed motive case, an employee friendly, burden-shifting test applies to a motion for summary judgment in an ADEA claim.

As a result, the McDonnell Douglas test, an employee friendly burden shifting standard, applies in the summary judgment phase and the Gross test, a strict “but for” standard, is left for the trial phase. Even though a small victory, this legal proof structure is a tool that will assist plaintiffs at the summary judgment stage so that they can have their day in court. 

Represented Resistance: Unmasking the Brutality of the New Regime of Workers’ Compensation, and How Hiring a Lawyer Can Help Workers Fight Back

Every workers’ compensation applicant faces a choice of finding an attorney to assist them in their struggle, or attempting to take on the system alone. Many ask themselves, Does it really matter? Will it help my case in any significant degree to have a lawyer on my side? Often, injured workers wind up deciding based on anecdotes and conjectures. 

New evidence compiled by UC Berkeley researcher Frank Neuhauser demonstrates that on the whole, represented workers recover at substantially higher levels than those without attorneys. Moreover, under the reworking of the system undertaken in 2005, the gulf between those with lawyers and those without has increased. Attorneys provide returns in workers’ comp, and this is truer now than before.

Work Comp Central reports on this breathtaking new study, which was presented to California’s employer-labor workers’ compensation advisory and research panel. (The story can be found here—though access to the website is for subscribers only.)

Neuhauser’s statistics are striking: unrepresented workers’ average impairment ratings stood at 22.2% before the 2005 schedule and 13.3% afterward. Workers with attorneys, however, received much higher ratings:  37% before 2005, and 26.5% under the current schedule. At present the gulf in permanent disability money is over $5,000—and that is only an average. 

Moreover, the compensation difference between those with lawyers and those without has grown under the new regime. While on the whole represented workers recover less than they did before (~37.2%), the unrepresented overall recover less than half what they did before (a 51.7% decrease). Neuhauser hypothesizes that part of this is attributable to the Almaraz-Guzman and Ogilvie cases. To simplify these complex matters greatly—the former can allow a more holistic disability rating than the rating found under the strict application American Medical Association guidelines, while the latter case can enable a higher rating when an existing assessment does not fully account for a worker’s diminished future earning capacity. Good attorneys can help highlight these special legal concerns to medical evaluators when necessary, while most injured workers are unfamiliar with these rules.

It is worth noting that the above data, while astounding, does not even address the many other ways in which representation may prove beneficial in workers’ comp—for instance, in ensuring that adjusters authorize requested medical treatment in a timely and effective manner.

While securing representation is more important than ever for individual applicants, Neuhauser’s data still shows that the post-2005 workers’ comp system is stingier and more ruthless than its predecessor. Navigating the present system is worse—substantially worse—for the unrepresented, but under the new regime, the workers’ comp system as a whole has lowered permanent disability payments by 58%—an incredible amount, estimated at $2,640,000,000.

For that, there is no immediate remedy. Labor unions, applicants’ attorneys, and the working and injured people of the state of California must join together and make our message clear. We must let the legislature and Governor Brown know that the child of just pay for injured workers can no longer be surrendered to the talons of profiteers and anti-social special interests.

That greater struggle will continue. For the time being, injured workers must fight their smaller skirmishes to secure their rightful benefits, marching into battle in the shackles of the present regime, whether alone or armed with the power of a Counselor at Law.

Wednesday, January 11, 2012

Accountability and Wisteria

Where does the personal end and the legally compensable begin? California’s Second Appellate District recently had a chance to weigh in on this crucial workers’ compensation question as it relates to a work-from-home firefighter.

Richard Warner is a Los Angeles County firefighter who works and lives on tiny, picturesque Santa Catalina Island. To ensure that the approximately 4,000 residents of the island have fire protection, LA County required Warner, along with one other firefighter, to live on the island. Warner’s house is both residence and partial workplace. Island denizens visit him there when they need his services, and he often responds to incident calls directly from home, without traveling to the island’s modest fire station.

In February of 2010, Warner’s wife asked him to help her trim the wisteria that grows wildly around their house. Warner climbed a ladder to perform the task. Unfortunately, while cutting back the burgeoning blossoms, he fell off the ladder and injured his neck and his back, as well as his wrist, elbow, and shoulder on his left side.

The County tried, with initial success, to avoid paying disability or medical costs to Warner, under the claim that this injury was due to a personal act—a favor Mr. Warner did for his wife—rather than part of his employment obligations. The Workers’ Comp Appeals Board sided with the County, concluding that although Warner suffered his injury in the course of employment, it did not arise out of employment, because trimming the wisteria was something he did for private purposes.

The Second Appellate District struck down the Board and upheld Warner’s rights. The Appellate Court invoked the time-honored Dual Purpose Doctrine:  if an action serves both personal and employment-related ends, it is an act which “arises out of work” for compensation purposes. There was no question that Warner worked from his home. It was equally incontestable that the County benefited from having this fire station-cum-residence be both easily accessible and aesthetically pleasing.

In other words, trimming the wisteria served both Warner’s ends and those of his boss—the fact that Warner acted at his wife’s request did not negate this fact. His employer must pay him workers’ comp.

The court’s decision is unpublished, but it nevertheless represents a significant vindication of the rights of workers in a time when they are under increasing attack. Workers’ comp exists to help those who are hurt serving their bosses’ interests. Employers who compel their subordinates to mingle duty and leisure should not be able to cry “Personal purposes!” when the same mingled deeds lead to mangled results.

It is reassuring that the Court of Appeals recognizes this.