Employment Law Daily Jury will decide if COO told HR rep not to hire blacks, retaliated by eliminating HR department
Friday, August 4, 2017

Jury will decide if COO told HR rep not to hire blacks, retaliated by eliminating HR department

By Lorene D. Park, J.D.

Although a bank’s HR manager failed to make a prima facie showing that she was fired based on her race or color, given that the decisionmaker was also African-American and was the same individual who hired her, a federal district court in Texas denied the bank’s motion for summary judgment on her Title VII retaliation claim based on evidence that a chief operating officer (COO) who told her not to hire black tellers influenced the CEO’s decision to eliminate the HR department and evidence calling into question the bank’s financial justification for the decision. A black bank teller whom the HR manager testified was fired due to his race or color also avoided summary judgment on his Title VII discrimination claims (Donald v. Plus4 Credit Union, July 31, 2017, Miller, G.).

Told to hire the “right people.” The first plaintiff, who served as the bank’s HR manager from November 2013 through March 2015, claimed the COO instructed her to hire only white employees for a new branch office located in Humble, Texas. The COO allegedly said: “Hire all White but maybe have one (1) Black person as a teller in the back so they wouldn’t be seen . . . We have to have the right look.” The HR manager verbally disagreed and subsequently hired the second plaintiff, an African-American male referred by a temp agency, as a temporary teller.

During his interviews with the HR manager, a sales manager, and the branch manager, the second plaintiff had his hair in dreadlocks. All approved his hire, as did the CEO, but on his first day the COO allegedly told the HR manager to fire him because he was black and had dreadlocks, though she said not to tell the temp agency the real reason for the termination. According to the HR manager, the COO then said she was going to sit in on all the interviews so “we can hire the right people for Humble.” Again the HR manager disagreed and said the teller could not be fired for those reasons. She also emailed her concerns to the COO.

Monitored, given less favorable review. The HR manager claimed that after these exchanges, the COO began to monitor her daily with the company’s video system, which she did not do to others to the same extent. She also repeated her instructions to fire the teller, but the HR manager refused each time. On the CEO’s recommendation, the HR manager met with one of the bank’s attorneys and reported that the COO wanted to fire the teller because he was black. The attorney said he would conduct leadership and diversity classes with management, but no such classes were actually conducted. In addition, the HR manager subsequently received a less favorable review and was told to comply with executive orders—the only order she had not complied with, however, was the one to fire the teller and to not hire blacks.

Terminations. The teller was terminated in November 2014, purportedly due to performance problems, personal phone use, and loud singing. The plaintiffs claim, however, that he was fired because of his race, color, and/or religion. After the teller’s termination, the HR manager allegedly continued to oppose other discriminatory practices and experienced retaliation by the COO before being terminated in March 2015. The bank claimed it eliminated her department (her position and her assistant, who was Caucasian) in order to cut costs. The HR manager claimed the real reason was race discrimination and/or retaliation.

HR manager’s discrimination claims fail. Moving for summary judgment against the HR manager’s discrimination claims, the bank argued that she could not make a prima facie showing she was qualified for any position to which it would have reassigned her after her department was eliminated. The court found this argument illogical because it would mean that a Title VII claim could be defeated anytime an entire department is eliminated. The HR manager only needed to show she was qualified for the position from which she was terminated. That said, the court found she lacked sufficient evidence for a prima facie showing that she was terminated because of her gender. The mere fact that both individuals in the eliminated department were female was not enough and there was no other evidence to support this claim.

Unrebutted same-actor inference. The HR manager also failed to make out a prima facie case of race or color discrimination. She relied on the COO’s instruction that she hire white tellers, but those comments were made seven months before she was terminated. Moreover, the CEO who made the decision to eliminate the HR department was also African-American, and he was the same individual who hired her, raising the same-actor inference that racial animus was not the reason for the adverse action. Without evidence rebutting that inference, her claim failed.

HR manager’s retaliation claim proceeds. On the other hand, summary judgment was denied on her claim that she was fired in retaliation for refusing to fire the teller and meeting with a lawyer about discriminatory hiring practices. The court declined the bank’s invitation to apply the “manager rule,” under which management employees performing routine duties do not engage in protected activities when disagreeing with the employer. That rule applies in FLSA cases and has not yet been adopted by the Fifth Circuit for Title VII claims. Here, the court found that the HR manager engaged in protected activity and made a prima facie showing of a causal link to her termination based on temporal proximity. She also raised a triable question on whether the cost-saving reason for her termination was pretextual based on evidence that the COO influenced the decision and on inconsistent testimony about the bank’s financial problems.

Teller’s claims proceed. Also denying summary judgment on the teller’s Title VII race and color discrimination claims, the court found a genuine dispute of fact on whether the COO, who the HR manager testified told her to fire the teller because of his race and dreadlocks and who made other racially derogatory comments, influenced the CEO’s termination decision. The comments were also made proximate in time to his termination.

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