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McKenna Employment Bulletin – March 2012


Denial of Employment to Debtor by Government Contractor Valid

In In re Uplinger, 2012 WL 194621 (Bkrtcy.E.D.Va.,2012), the Plaintiff applied for a job with a governmental contractor. She was denied employment allegedly based on her filing for protection under the Bankruptcy laws and sued the contractor as well as the governmental unit that the contractor worked with under Section 525 of the U.S. Bankruptcy Code, which makes discrimination against debtors illegal. Section 525(a) applies to governmental units only and prohibits them from denying employment to, terminating the employment of or discriminating in any manner against a person who is or has been a debtor under the Bankruptcy Code. Section 525(b) applies to private employers and only prohibits the discrimination against an existing employee. It does not prohibit the denial of employment to a debtor. In a case of first impression, the bankruptcy court in Uplinger held that a governmental contractor is not a governmental unit for purposes of the Section 525(a) of the U.S. Bankruptcy Act protecting debtors against discrimination. Therefore, the refusal to hire based on her status as a debtor did not violate the Bankruptcy Code.


Graphic Videos on Employee\xD5s Myspace Do Not Prevent Sexual Harassment Claim

In EEOC v. Management Hospitality of Racine, Inc., No. 10-3247, Seventh Circuit, January 6, 2012, the jury entered a verdict in favor of the plaintiffs in a Title VII case in which the plaintiffs alleged that their supervisor sexually harassed them. The Seventh Circuit affirmed the verdict and judgment because the record contained evidence that the supervisor subjected the plaintiffs to sexual propositions and other comments of sexual nature, as well as touching them inappropriately. The Court found that the fact that one plaintiff had a sexually graphic video on her MySpace page did not support a finding that the plaintiff did not subjectively find the supervisor’s conduct to be offensive. Furthermore, the Court found the employer was not entitled to an affirmative defense based on its sexual harassment policy because even though it had established an anti-sexual harassment policy, the record showed that the employer’s supervisors failed, among other things, to follow its own policy when they ignored the plaintiffs’ complaints of harassment. In addition, the Court held that the jury could properly impose punitive damages where the record had evidence indicating that the employer discouraged employees from reporting sexual harassment and was otherwise ineffective in either educating employees as to their Title VII rights or in training the relevant supervisors on the issue of sexual harassment.


Same Sex Harassment Is Actionable

In Cherry v. Shaw Coastal, Inc., 2012 WL 147867 (5th Cir.), the Court found that the evidence of same-sex harassment was sufficient for a male employee’s sexual harassment claim against his former employer. The employee had alleged sexual harassment claims based on the actions of a male supervisor. The supervisor sent a text message to the employee inviting the employee to stay at the supervisor’s house and wear his underwear. The Court held this could be taken as an explicit sexual proposition. The supervisor also repeatedly physically touched and caressed the employee’s body. The Court found that the supervisor’s actions were offensive enough that a male co-worker, having witnessed the behavior, felt compelled to complain to their supervisor.


Pre-Fmla Leave Actions Are Protected

In Pereda v. Brookdale Senior Living Communities, Inc., 2012 WL 43271 (11th Cir.), the Court held as an issue of first impression that employees are protected from interference with their FMLA rights prior to the occurrence of a triggering event, such as the birth of a child. The Court found that a pre-eligible employee has a cause of action under the FMLA if an employer terminates her in order to avoid having to accommodate that employee with rightful FMLA leave rights once she becomes eligible.


An Employer's Non-Discriinatory Reason Overrides a Title Vii Claim

In Martinez v. W.W. Grainer, Inc., 2011 WL 6412433 (8th Cir.), the Court assumed that an Hispanic employee of Cuban origin established a prima facie case of wage discrimination based on race and national origin under Title VII. He did this by showing that he was the only branch manager paid below the recommended salary range at the branch level. The employer’s non- discriminatory reasons for the employee’s salary were that the employer determined the employee’s salary by considerations other than the designated level of the branch, including sales volume and business complexity. The evidence was that the employee was also paid more than managers at other comparable branches at various points during his tenure. The Court, therefore, found that the employer’s non-discriminatory reasons for the employee’s salary were not pretext for wage discrimination.


This Employment Bulletin is intended to provide information of general interest and does not constitute legal advice. Readers should consult with their counsel before taking any action based on the information in this publication. All rights reserved. Copyright 2013, McKenna Storer. 

Categories Employment Bulletin Publications

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