United States: Supreme Court Reinstates Pregnancy Discrimination Claim Against UPS

The U.S. Supreme Court on March 25, 2015, vacated a Fourth Circuit Court of Appeals decision and revived a pregnancy discrimination lawsuit brought against United Parcel Service (UPS).

The case concerned Peggy Young, a part-time driver for UPS. When Young became pregnant, her doctor advised her that she should not lift more than 20 pounds. UPS, however, required drivers like Young to be able to lift up to 70 pounds. UPS advised Young that she could not work while under a lifting restriction. As such, Young stayed home without pay during most of the time she was pregnant.

Young subsequently filed a lawsuit in federal court, contending that UPS had acted unlawfully in refusing to accommodate her pregnancy-related lifting restriction. Among other things, Young maintained that UPS had accommodated several individuals whose disabilities created work restrictions similar to hers. Specifically, Young pointed to UPS policies that accommodated employees who were injured on the job, had disabilities covered by the Americans with Disabilities Act (ADA) or had lost Department of Transportation (DOT) certifications. Young contended that these policies showed that UPS discriminated against its pregnant employees because it had a light-duty-for-injury policy for numerous "other persons," but not for pregnant employees. UPS responded that, since Young did not fall within the on-the-job injury, ADA or DOT categories, UPS had not discriminated against Young on the basis of pregnancy, but had treated her just as it treated all "other" relevant "persons."

A lower court granted summary judgment to UPS, concluding, inter alia, that Young could not make out a prima facie case of discrimination under the test set forth in McDonnell Douglas. The Fourth Circuit Court of Appeals affirmed.

Title VII and the Pregnancy Discrimination Act

Title VII of the Civil Rights Act of 1964 (Title VII) forbids a covered employer from "discriminat[ing] against any individual with respect to ... terms, conditions, or privileges of employment, because of such individual's ... sex." 42 U.S.C. § 2000e–2(a)(1).

In 1978, Congress enacted the Pregnancy Discrimination Act, which added new language to Title VII's "definitions" subsection. The first clause of the 1978 Act specifies that Title VII's "ter[m] 'because of sex' ... include[s] ... because of or on the basis of pregnancy, childbirth, or related medical conditions." § 2000e(k). The Pregnancy Discrimination Act's second clause provides that employers must treat "women affected by pregnancy ... the same for all employment-related purposes ... as other persons not so affected but similar in their ability or inability to work." Id. (emphasis added).

At issue in Young's case was how the latter provision applies in the context of an employer's policy that accommodates many, but not all, workers with nonpregnancy-related disabilities.

Majority Opinion

The Supreme Court, by a 6-3 vote, found unpersuasive both parties' interpretation of the Pregnancy Discrimination Act. Young had contended that as long as "an employer accommodates only a subset of workers with disabling conditions," "pregnant workers who are similar in the ability to work [must] receive the same treatment even if still other nonpregnant workers do not receive accommodations." The Court concluded that Young's reading "prove[d] too much," and that it was doubtful that Congress had intended to grant pregnant workers an unconditional "most-favored-nation" status, such that employers who provide one or two workers with an accommodation must provide similar accommodations to all pregnant workers, irrespective of any other criteria. The Court further disagreed with UPS' contention that the second clause of the Pregnancy Discrimination Act does no more than define sex discrimination to include pregnancy discrimination. The Court concluded that the first clause of the Act accomplishes that objective, and therefore, reading the second clause as UPS proposed would render the first clause superfluous.

The Court also concluded that it could not "rely significantly" on the EEOC's 2014 guidance concerning the application of Title VII and the ADA to pregnant employees due to challenges with "timing," "consistency" and "thoroughness" of "consideration" necessary to give the EEOC's guidance "power to persuade."

Writing on behalf of the majority, Justice Breyer explained that the Pregnancy Discrimination Act "requires courts to consider the extent to which an employer's policy treats pregnant workers less favorably than it treats nonpregnant workers similar in their ability or inability to work." Justice Breyer further explained that, in all cases in which an individual plaintiff seeks to show disparate treatment through indirect evidence, courts have to "consider any legitimate, nondiscriminatory, nonpretextual justification for these differences in treatment." Justice Breyer wrote, "Ultimately[,] the court must determine whether the nature of the employer's policy and the way in which it burdens pregnant women shows that the employer has engaged in intentional discrimination."

In vacating the judgment of the Fourth Circuit, the Court concluded as follows:

McDonnell Douglas Framework

The majority explained that an individual pregnant worker who seeks to show disparate treatment may make out a prima facie case under the McDonnell Douglas framework by showing that she belongs to the protected class, that she sought accommodation, that the employer did not accommodate her and that the employer did accommodate others "similar in their ability or inability to work." The employer may then seek to justify its refusal to accommodate the plaintiff by relying on "legitimate, nondiscriminatory" reasons for denying her accommodation.

The majority further explained that if the employer offers a "legitimate, nondiscriminatory" reason for its actions, the plaintiff may show that the employer's proffered reasons are in fact "pretextual." The plaintiff may reach a jury on this issue by providing sufficient evidence that the employer's policies impose a significant burden on pregnant workers, and that the employer's "legitimate, nondiscriminatory" reasons are insufficiently strong to justify the burden, "but rather—when considered along with the burden imposed—give rise to an inference of intentional discrimination." The plaintiff can create a genuine issue of material fact as to whether a significant burden exists by providing evidence that the employer accommodates a large percentage of nonpregnant workers while not accommodating a large percentage of pregnant workers.

Dissent

Justices Scalia, Kennedy and Thomas issued a dissent wherein they maintained that the Court impermissibly crafted "a new law that is splendidly unconnected with the text and even the legislative history of the [Pregnancy Discrimination] Act." The dissent further noted that the Court had conflated the standards between disparate treatment and disparate impact. Writing on behalf of the dissent, Justice Scalia explained that normally, liability for disparate treatment arises when an employment policy has a "discriminatory motive," while liability for disparate impact arises when the effects of an employment policy "fall more harshly on one group than another and cannot be justified by business necessity." Justice Scalia noted, "In the topsy-turvy world created by today's decision, however, a pregnant woman can establish disparate treatment by showing that the effects of her employer's policy fall more harshly on pregnant women than on others [] and are inadequately justified []." He further explained that, although the change in labels may be small, the change in results is not, given that disparate-treatment and disparate-impact claims have different standards of liability, different defenses and different remedies.

What This Means for Employers

The Court did not determine whether Young had created a genuine issue of material fact as to whether UPS' reasons for having treated Young less favorably than it treated other nonpregnant employees were pretextual. The Fourth Circuit will decide that issue on remand. Additionally, while the Court explained what likely will not be considered "legitimate, nondiscriminatory" reasons for denying an accommodation (namely, expense and convenience), the Court refrained from providing examples of what may be considered legitimate interests.

Nonetheless, in light of the Supreme Court's interpretation of the Pregnancy Discrimination Act, employers may want to review their accommodation policies; consider how those policies are applied to pregnant employees; determine how many employees are given the opportunity to take advantage of those policies; and establish procedures for determining what accommodations, if any, are appropriate.

Employers should be aware that the pool of comparators (for purposes of a discrimination claim) will likely be broad, given that more disabilities are now covered under the ADA.

Additionally, with the Court's criticism of the EEOC's guidance concerning the application of Title VII and the ADA to pregnant employees, employers should be on the lookout for revised guidance from the EEOC on this subject.

Employers should also be aware that many jurisdictions now have pregnancy statutes that affirmatively require employers to reasonably accommodate pregnant employees, at least to a certain extent.

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