There has been a lot of buzz about the gigantic punitive damages award recently handed down in a pregnancy and sex discrimination case in California. For us, it is an opportunity to examine what lessons can be learned.
Lesson No. 1: Employers must thoroughly train their managers and top-level executives in the area of retaliation so that they understand that a court may infer retaliation, simply from (1) an internal complaint of discrimination and (2) an adverse employment action, such as termination, if the two events occur close in time. Consequently, employers must take great precautions when terminating an employee who has complained of discrimination in the past.
Rosario Juarez, a manager at AutoZone, was terminated by her employer more than two years after she first filed a charge of pregnancy discrimination with the California Department of Fair Employment and Housing and more than nine months after she filed her Complaint. During the summary judgment phase, the U.S. District Court for the Southern District of California looked to a deposition in which Juarez participated six weeks before her termination to establish a causal connection between protected activity and termination. Employers should take heed and seek legal counsel before deciding to terminate an employee who has complained of discrimination in the past or who is engaging in litigation.
Lesson No. 2: Employers must also be absolutely certain they can corroborate their reason for termination so that it is not deemed pretextual by the court. Here, AutoZone contended it terminated Juarez because she misplaced $400 from the cash register and failed to cooperate in an internal investigation surrounding the misplacement of the $400. Although AutoZone’s Payroll Termination Report listed “policy violation” as the reason for termination, neither AutoZone nor its witnesses were able to point to a specific policy that Juarez violated. And although another employee was involved in the misplacement of the cash, AutoZone did not discipline this employee. Finally, an HR member testified at trial that managers could not be terminated for refusing to submit a statement in an internal investigation. Employers should be cautious about enforcing their policies equally, and they must ensure that their managers understand their company policies.
Lesson No. 3: Finally, employers must thoroughly train their managers and top-level executives on how to deal with pregnant employees. Here, Juarez claims her manager consistently told her that he thought that she could no longer handle her job because she was pregnant, saying it was “too much for your condition.” She also claims he encouraged her to step down and increased her workload. Such comments and behavior – which directly relate to an employee’s pregnancy – are like kindling for a fire: they make employers highly vulnerable to liability for pregnancy discrimination.
This past July, the EEOC issued new guidelines under the Pregnancy Discrimination Act. And these guidelines may be tested by the Young v. UPS case, which is currently pending before the United States Supreme Court.
For more information about the AutoZone case, the new EEOC guidelines, or how to ensure your company is not liable for pregnancy or sex discrimination, please contact any of the attorneys at BurnsBarton PLC.