EMPLOYMENT DISCRIMINATION

By Gregory C. Parliman and Theresa A. Kelly
Pitney, Hardin, Kipp & Szuch

There is a substantial body of federal statutory law which prohibits employers from engaging in discrimination in the workplace. In addition to federal law, most states also have enacted laws prohibiting discrimination on the basis of race, color, religion, sex, national origin, age or handicap. Under both federal and state law, there are a broad range of remedies available to employees who are successful in employment discrimination lawsuits.

I. Title VII of the Civil Rights Act of 1964

Title VII of the Civil Rights Act of 1964 (Title VII), 42 U.S.C. §2000e et seq., is the primary federal discrimination statute and applies to employers with fifteen or more employees. Under Title VII, employers may not discriminate on the basis of race, color, religion, sex or national origin in hiring or discharging employees, or in the terms and conditions of employment. The terms and conditions of employment include, among other things, hiring, compensation, work assignment, promotion and termination.

Discrimination prohibited by Title VII includes not only intentional discrimination, but also conduct that has a disparate adverse impact on a protected class of employees. Harassment based upon a protected characteristic or creation or tolerance of a hostile work environment is also prohibited. A hostile work environment is characterized by pervasive and offensive treatment of an employee because of race, color, religion, sex or national origin. For example, such things as racial slurs, graffiti and ethnic jokes may demonstrate a consistent pattern of harassment. Sexual harassment, in particular, has in recent years become a focal point for Title VII claims. Sexual harassment is characterized by unwelcome conduct of a sexual nature which adversely affects a term or condition of employment or which results in a hostile work environment. Employers are required to maintain a workplace atmosphere free of intimidation on the basis of any protected characteristic, such as race or sex.

In addition, employees who protest unlawful employment discrimination are protected from retaliatory action by their employers. Title VII prohibits retaliation against an employee who opposes any discriminatory employment practice or who makes a charge, testifies, assists or participates in any investigation, proceeding or hearing regarding a claim of employment discrimination. In order to be protected, an employee's actions in protesting unlawful discrimination must be legal and must not interfere with the work of other employees or the employer. Prohibited retaliatory action can include any adverse job action taken as a result of protected activity including demotion, suspension, loss of normal work assignment and adverse comments to prospective employers.

Title VII is enforced by a federal administrative agency, the Equal Employment Opportunity Commission ("EEOC"), which has district offices throughout the United States. An employee claiming discrimination must file a charge with the EEOC within 180 days after the alleged discrimination. The filing of an EEOC charge is a prerequisite to bringing an action in federal court.

In most states, the EEOC will defer to qualified state agencies for the investigation of discrimination charges. In such "deferral" states, the employee must first file a discrimination charge with the state agency. The employee may then file a federal EEOC charge after 60 days if the charge has not been satisfactorily resolved by the state agency. In deferral states, an aggrieved employee has 300 days after the alleged discrimination in which to file a charge with the EEOC.

II. Pregnancy Discrimination Act of 1978

The Pregnancy Discrimination Act of 1978, 42 U.S.C. §2000e(k), amended Title VII to prohibit discrimination against employees or applicants on the basis of pregnancy and requires employers to treat pregnant employees in the same manner as employees with other medical disabilities. An employer may not require a pregnant employee to take leave if the employee is capable of performing her duties. If the employer provides parental leave to pregnant women for the purpose of child care rather than because of medical disability resulting from pregnancy and childbirth, such parental leave must be provided for male employees as well.

Employers may not establish fetal protection policies excluding pregnant or potentially pregnant women from certain jobs in an effort to protect the workers' unborn children if the women are otherwise capable of performing the work.

III. Age Discrimination in Employment Act of 1967

The Age Discrimination in Employment Act of 1967 (ADEA), 29 U.S.C. §621 et seq., applies to employers with twenty or more employees and prohibits discrimination on the basis of age against persons 40 years of age or older. The ADEA prohibits, among other things, mandatory retirement at any age except for employees who serve in high-level policy-making positions and are immediately eligible to receive annual pensions of $44,000 or more. Such high-level policy-making employees may be required to retire at age 65.

The ADEA also prohibits discrimination between older and younger employees within the age group of 40 and above. When bias occurs within the protected group, for example employees in their 50's are discriminated against in favor of those in their 40's, employees in the older group can establish a claim of age discrimination. As with Title VII, the ADEA also prohibits retaliation against any employee who either opposes age discrimination or participates in any proceeding alleging age discrimination. The ADEA is administered by the EEOC. An aggrieved employee must file an EEOC charge within 180 days, or 300 days in deferral states, after the alleged discriminatory conduct.

IV. Older Workers' Benefits Protection Act

Under the 1990 Older Workers' Benefits Protection Act (OWPA), 29 U.S.C. §623, employers may not discriminate against older workers in the provision of employee benefits such as group health care insurance. Benefits provided to younger workers must be provided on the same basis to older workers unless a reduced level of benefits can be justified by age-related cost factors.

V. The Equal Pay Act of 1963

Another federal anti-discrimination statute administered by the EEOC is the Equal Pay Act of 1963, 29 U.S.C. §§1981-1983, which requires employers to pay men and women equal pay for equal work. Equal work is defined as work which requires equal skill, effort and responsibility and which is performed under similar working conditions. The requirement of equal pay for equal work includes all forms of compensation including, among other things, profit sharing, expense accounts and bonuses. Employers are permitted to use pay differentials, such as seniority, merit and incentive systems, or any other lawful factor not based upon sex. The Equal Pay Act applies to employers with two or more employees engaged in interstate commerce or the production or handling of goods in interstate commerce. Generally, comparisons of employees at the same physical work location are made.

VI. The Reconstruction Era Civil Rights Acts

During the Reconstruction period following the Civil War, several civil rights acts were enacted to enforce the provisions of the Thirteenth, Fourteenth and Fifteenth Amendments to the United States Constitution. 42 U.S.C. §§1981-1983. In recent years, these civil rights acts have increasingly been used in employment discrimination cases to supplement the relief afforded by Title VII and other federal statutes. The Civil Rights Act of 1866 prohibits racial discrimination in the making and enforcement of contracts and applies to private and public employers. The Civil Rights Act of 1871 addresses civil rights violations by government entities, and applies only to public employers.

VII. The Americans With Disabilities Act of 1990

The Americans with Disabilities Act ("ADA"), 42 U.S.C. §12101, prohibits discrimination against individuals with disabilities in employment, public services and public accommodations. The ADA applies to employers with fifteen or more employees. A disability is defined as a physical or mental impairment which substantially limits one or more "major life activities." An employer is not required to give preference in hiring to individuals with disabilities, but cannot discriminate against "qualified" individuals with disabilities. An employee or applicant who is capable of performing the "essential" functions of the job with or without reasonable accommodation is a qualified individual with a disability.

An employer is required to make reasonable accommodation for disabled employees or applicants to enable them to perform a job, unless the employer would suffer an undue financial hardship as a result, or unless the employment would pose a threat to the employee or to co-workers. The financial burden on the employer is measured in relation to its size and resources. Like Title VII, the ADA is administered by the EEOC.

VIII. Federal Family and Medical Leave Act

The federal Family and Medical Leave Act (FMLA), 29 U.S.C. §2601 et seq., requires an employer with 50 or more employees to provide its employees with 12 weeks of unpaid, job-protected leave during any 12-month period to care for a newborn or newly adopted child; to care for a sick parent, spouse or child; or because of the employee's own serious health condition. The FMLA also requires that an employer continue to provide health benefits to an employee during the period of leave at the level and under the conditions that coverage would have been provided had the leave not been taken.

IX.. Requirements Imposed Upon Government Contractors

Executive Order 11246 requires employers doing business with the federal government to comply with certain equal opportunity and affirmative action regulations. These regulations are administered by the Office of Federal Contract Compliance Programs (OFFCP). There are two basis requirements imposed upon government contractors and subcontractors. First, each government contract must contain an equal opportunity clause which prohibits the contractor from discriminating against employees or applicants on the basis of race, color, religion, sex, or national origin. Government contracts for less than $10,000 are exempt from this requirement.

In addition to the equal opportunity clause requirement, employers with fifty or more employees and government contracts or subcontracts worth $50,000 or more must develop and maintain an affirmative action plan. The employer is required to analyze its employment practices and to affirmatively hire, retain and promote women and members of minority groups. Noncompliance may result in debarment from government contracts.

Under the Vietnam Veteran's Readjustment Assistance Act of 1974, certain government contractors and subcontractors must take affirmative action to hire, retain and promote qualified individuals who are disabled or who served in the military during the Vietnam War era.

Under the Rehabilitation Act of 1973, employers which have government contracts worth $2500 or more may not discriminate against individuals with physical or mental handicaps.

X.. Remedies for Employment Discrimination

A broad range of remedies are available to employees who are successful in employment discrimination lawsuits. The following section discusses the remedies of back pay, front pay, the mitigation of back pay and front pay damages, punitive damages, damages for pain, suffering and emotional distress, attorneys' fees and the right to a jury trial in the context of the federal employment discrimination laws.

A. Back Pay

A prevailing employee in an employment discrimination action is entitled to "back pay" from the date of the alleged discriminatory conduct until the date of trial. This relief is equitable in nature and is intended to make victims of discrimination whole by restoring them to the position in which they would have been absent discrimination. Once a violation of one of the discrimination laws is proven, a victim is presumed to be entitled to an award of back pay.

The amount of a back pay award is the difference between the actual wages earned by the employee during the back pay period and the wages which would have been earned absent discrimination by the employer. Because back pay awards are equitable in nature, they also include payments for the value of any lost or diminished benefits. This would include items such as medical insurance, profit sharing, vacation and sick pay and other fringe benefits. Any uncertainty in the calculation of a back pay award is borne by the wrongdoer, not the victim.

B. Front Pay

Courts may also award a successful employee in an employment discrimination action an award of front pay. Front pay is monetary relief for any future loss of earnings resulting from past discrimination. Front pay awards are made in lieu of the traditional equitable remedy of reinstatement when reinstatement of the employee to his former job is not a feasible remedy. The policy reason supporting an award of front pay is to provide the employee with income for an additional time period to pursue a return to a position he would have occupied but for the alleged discriminatory conduct.

There is a splint among the federal courts as to whether the court or the jury should calculate the amount of front pay awards. Additionally, courts have disagreed over the amount of time for which front pay may be awarded. Some courts have viewed the award of front pay as being temporary in nature in order to compensate the employee during an employment adjustment period and have limited the amount of front pay awards. Other courts, however, have awarded front pay to employees who are successful in employment discrimination lawsuits for longer periods of time in situations where the employee had no reasonable prospect of obtaining comparable alternative employment. Thus, there is no fixed test to determine the amount of front pay which could be awarded to an employee in a given case, especially if this amount will be calculated by a jury.

C. Mitigation of Back Pay and Front Pay Damages

An employee who is awarded damages in an employment discrimination lawsuit is required to mitigate these damages by being reasonably diligent in seeking employment substantially equivalent to the position which he lost. The burden is on the employer to establish that the employee failed to mitigate his damages in order to limit an award of back pay or front pay.

For purposes of mitigation of damages, "substantially equivalent employment" has been defined as employment which provides virtually identical advancement opportunities, compensation, job responsibilities, working conditions, and status as the position from which the employee has been discriminatorily terminated. If the employee cannot locate substantially equivalent employment, he may lower his sights and accept non-comparable employment.

D. Punitive Damages

Employees may recover punitive damages in employment discrimination actions under Title VII and the ADA upon proof that the employer acted with malice or reckless indifference to the rights of the employee. Punitive damages are intended to punish the employer for willful violations of the law and to deter the employer from future discriminatory acts.

Punitive damages awards under Title VII and the ADA are not to exceed $300,000 for employers of more than 500 employees. For employers with fewer than 500 employees, the limits on punitive damages are as follows: $50,000 for employers of 100 or fewer employees; $100,00 for employers with more than 100 and fewer than 201 employees; $200,000 for employers with more than 200 and fewer than 501 employees. Many state discrimination laws also provide for punitive damages and most have no limit on the amount of punitive damages which can be awarded.

Punitive damages are not recoverable under the ADEA. However, employers who willfully violate the ADEA such that they either knew or show a reckless disregard for whether their actions are unlawful may be assessed a penalty known as "liquidated damages." Liquidated damages are calculated as the amount equal to the employee's monetary loss and in effect double the total amount of damages received.

E. Damages for Pain, Suffering and Emotional Distress

Damages for pain, suffering and emotional distress are also available under Title VII and the ADA. In order to recover damages for pain, suffering and emotional distress all an employee need do is present evidence from which a jury could determine that he or she suffered mental anguish. Damages for pain, suffering and emotional distress are not recoverable under the ADEA.

F. Attorney's Fees

Under all of the federal employment discrimination laws, courts are permitted to award attorney's fees to employees who prevail on discrimination claims. The mere fact that an employer's discriminatory conduct was unintentional or in good faith does not bar an award of attorney's fees. Employees are considered "prevailing parties" if they are successful on any significant issue in the litigation which achieves some of the benefit the employee sought in bringing suit.

G. Jury Trials

Under Title VII and the ADA, an employee may request a jury trial if compensatory or punitive damages are sought. Jury trials are also available under the ADEA.

(August 1996)

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