Granting in part the EEOC’s motion for sanctions against JBS Swift & Company in this long-running dispute over whether, as the EEOC claims, JBS failed to reasonably accommodate its Muslim employees’ request for prayer breaks, a federal court in Colorado found JBS had a duty to preserve documents containing information regarding stoppages and slowdowns of its production line as well as the reason for the delays and the EEOC was prejudiced by its spoliation of the evidence. However, because the EEOC did not show JBS acted in bad faith and it disclaimed any intention of affirmatively relying on the documents, the court refused to grant the agency’s request for an adverse inference. It found, however, that JBS should be precluded from arguing at trial or presenting any evidence that allowing prayer breaks causes downtime or slowdowns in production (EEOC v. JBS USA, LLC dba JBS Swift & Co., August 4, 2017, Brimmer, P.).
When a dispute between JBS, a beef processing plant operator, and its Muslim employees over their opportunities to pray at work came to a head during the first week of Ramadan 2008, hundreds of Muslim employees walked off the job. JBS subsequently fired 96 Muslim production line employees, claiming they refused to return to work. After they filed discrimination charges with the EEOC, JBS claimed that granting a prayer break to them would be an undue burden, in part because of losses resulting from “each minute of production down-time.”
Records requested. The EEOC subsequently sought sanctions for JBS’s failure to preserve two types of records tracking delays on its production line: handwritten Down Time Reports for each shift identifying the exact time and duration the production line stopped and the reason for the stoppage and Clipboards, a computerized summary of the Reports.
In response to a 2012 production request for all reports or data showing dates and times the lines stopped since 2008, JBS did not provide or reference the Reports or Clipboards. In 2016, discovery was reopened and after deposing a number of additional witnesses, the EEOC requested that JBS supplement its production of evidence. Although JBS produced about half a dozen Clipboards from 2012 and approximately five to six months of Clipboards from 2014, 2015, and 2016, it represented that “no other records existed, including all those from 2008 to 2011.”
In the warehouse. It also produced for the first time several Down Time Reports for 2016, indicating that those were “all of the available handwritten downtime reports. All others have been destroyed.” In June 2017, however, it produced 34 Reports and Clipboards, including 13 for September 2008, which it claimed it located by searching its warehouse for a day. It then claimed it reasonably believed the missing Clipboards and Reports were in the boxes stored there.
While JBS did not deny that the Reports were responsive to the EEOC’s request, it argued that Clipboards were not. Disagreeing, the court found that JBS failed to supplement its production with the responsive records in a timely manner and did not show the failure was “substantially justified or harmless.” Thus, it could impose sanctions pursuant to Fed. R. Civ. P. 37(c)(1).
Duty to preserve. JBS next argued it did not have a duty to preserve these documents because it “had no way of knowing or anticipating that the EEOC would be interested in knowing the specific time of every instance of every day that the production line stopped for an unplanned or unexpected reason.” Finding this contention unpersuasive, the court noted that it ignored the fact JBS asserted an undue burden defense within a year of the September 2008 incident and after charges of discrimination had been filed against it. It should have known these records were relevant to its affirmative defense and therefore preserved them in a manner so they could be reasonably retrieved if required, said the court, noting further that regardless of whether there was a duty to preserve the records before the EEOC asked for them, once the EEOC asked for them, they should have been preserved.
As to JBS’s argument that the EEOC did not prove it destroyed or lost any of the records, the court noted that the EEOC provided a statement from JBS’s counsel claiming the Reports that were not already produced had been destroyed and thus to the extent it now claimed the records were not destroyed but were probably stored somewhere in its warehouse, it did so equivocally. Nor could it claim the documents were not lost as it asserted that searching for them would be unduly burdensome. But, searching for these documents now, said the court, is burdensome only because JBS failed to preserve and produce the records on an ongoing basis as they were created. Noting that JBS did not claim it would have been burdensome to produce the records on an ongoing basis or to separately retain and store them at the plant or explain how records it claimed would take “hundreds of man hours” to locate now are not lost, the court found the records that were not produced were either lost or destroyed by JBS.
Prejudice. And while JBS argued that the records do not show whether any slowdown or stoppage was related to a prayer break because the information they contain “is only as specific as the information known to the person filling out the Down Time Report,” the court noted that several JBS managers claimed prayer breaks caused production delays, which was precisely the testimony the EEOC argued it could rebut through the Reports and Clipboards. Observing that courts are skeptical of employer claims that a proposed accommodation will result in undue hardship absent proof that the accommodation does result in actual hardship, the court here pointed out that records such as those sought, which potentially show the actual impact of unscheduled employee prayer breaks, are particularly important to understanding the impact the breaks would have on production line slowdowns or stoppages because they would provide contemporaneous records of whether unscheduled breaks led to production downtime. Accordingly, the EEOC was prejudiced by JBS’s spoliation of evidence.
Sanctions. In finding that JBS should be precluded from “arguing at trial or presenting any evidence that allowing prayer breaks causes downtime or slowdowns in production,” the court pointed out that while JBS knew litigation was imminent shortly after the events of Ramadan 2008 and raised an undue hardship defense regarding the discrimination charges within a year of those events, it failed to take necessary steps to preserve reasonable access to the relevant records or prevent their destruction. Further, this neglect continued even after the EEOC specifically requested records with the information contained in the Down Time Reports and Clipboards and despite claiming to still possess some of the records, JBS failed to supplement its responses.
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