Employment Law Daily Worker who won $1 Title VII suit may have been entitled to reinstatement
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Friday, March 29, 2019

Worker who won $1 Title VII suit may have been entitled to reinstatement

By Lorene D. Park, J.D.

The normal discord between parties in a discrimination suit was not a proper basis to deny reinstatement, nor should a court have considered alleged misconduct by the employee when the jury found this to be a pretextual reason for her termination.

Though an employer claimed it fired an employee for taking non-work-related classes during lunch and returning late, she convinced a jury that this was pretext for discrimination, given that others were allowed longer lunches. This, noted the Fifth Circuit, entitled her to make-whole relief, and though the lower court did not err in denying front pay, its decision to deny reinstatement was erroneous because it relied in part on improper reasons, including the employee’s alleged misconduct, which the jury had already found pretextual, and the parties’ acrimony, which to the appeals court appeared nothing more than the normal discord that comes with litigation. As such, the court vacated the denial of reinstatement and remanded for further proceedings (Bogan v. MTD Consumer Group, Inc., March 26, 2019, Costa, G.).

The employee worked at MTD Consumer Group, an outdoor equipment manufacturer, for about 20 years. She started in unskilled positions, but after taking classes at a community college she was promoted to machinist in the tool and die department. While pursuing that position, the employee also began going to school for a degree in social work.

Flexible hours taken away, fired. Her supervisors first accommodated her class schedule with flexible hours. However, in the fall of 2012, HR told her company policy only allowed flexible hours for work-related schooling, so she had to work a normal shift. Nonetheless, she still worked some irregular hours and occasionally squeezed in a class on lunch break. A supervisor suspended her and then she was fired after she came back from lunch late.

Trial court proceedings. In her discrimination suit, the court denied summary judgment because the evidence could show the reason for her termination was pretext. For example, others “routinely” took lunches longer than 30 minutes, but she was the only one punished for it. There were also doubts about the accuracy of information in her personnel file.

The case went to trial and the jury found that MTD discriminated based on the employee’s race and/or gender and it awarded her $1, possibly based on MTD’s argument that she failed to mitigate damages. The employee asked the court for reinstatement or front pay but, after a hearing, her request was denied. The court cited four factors against reinstatement and, as to front pay, held that MTD established she did not mitigate her damages.

No front pay. On appeal, the Fifth Circuit made short work of the front pay analysis. Though the employee made some good points in arguing that she made reasonable efforts to find work and to keep up her training, the appeals court found no clear error in the lower court’s conclusion that she did not use reasonable diligence to find “substantially equivalent employment.”

Court usually chooses front pay or reinstatement. However, the court vacated the denial of reinstatement, which was the preferred “make-whole” equitable remedy for discrimination under Title VII. In the Fifth Circuit, some form of prospective relief is ordinarily awarded, and the trial court’s discretion typically involves an either/or “selection between reinstatement and front pay.” While there might be “outlier situations” where no such relief is appropriate, such as where punitive damages made a victim whole, or there was serious employee misconduct, usually the court decides that either front pay or reinstatement is appropriate to remedy discrimination.

Court erred in denying reinstatement. Here, the lower court relied on four factors to deny reinstatement. On the first two, the appeals court agreed they counseled against reinstatement: the employee’s position no longer existed as it did during her employment and the employee intended to change careers to social work. But the third reason—that she would have been fired anyway for her attitude and inability to follow rules—was rejected by the jury when it found MTD liable for discrimination. It was error to allow MTD to relitigate this in the remedial phase.

The fourth reason, “discord between the parties,” was also problematic because such antagonism is a normal by-product of lawsuits. If hostility from litigation was enough to deny reinstatement, it would cease to be a remedy. Nor could the finding of discord rely on the reasons that the jury found pretextual (the employee’s alleged misconduct). To be a basis for denying reinstatement, the acrimony must rise to a level at which the parties’ relationship is “irreparably damaged.”

Here, the court made no finding of irreparable damage. It described the hostility as “palpable,” but the only example cited was the remedial-phase testimony of an HR manager discussing the “human resources issues he would face if the employee review process were to be negated by reinstating Plaintiff.” To the appeals court, this could simply be a problem of inconvenience, rather than hostility. It was not enough to militate against the preferred remedy of reinstatement.

Remand. Based on the foregoing, the appeals court found that it was error to consider two of the four factors relied on by the lower court in denying reinstatement. It therefore remanded for further proceedings, without suggesting how the district court should exercise its discretion based on the remaining two factors or other permissible considerations.

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