United States: Wisconsin Supreme Court Holds That State Disability Discrimination Law Requires Proof Of Intent To Establish Liability

The Wisconsin Supreme Court recently overturned a longstanding line of cases that allowed disabled employees to prevail in discrimination cases without proving the employer intended to discriminate or was even aware that the employee was disabled.  On June 26, 2018, the Wisconsin Supreme Court issued its long-awaited decision in Wisconsin Bell, Inc. v. Labor and Industry Review Commission and Charles Carlson (Carlson).1  The case involves the Labor and Industry Review Commission's ("LIRC") expansive definition of what it means to discriminate against employees "because of" a disability under the Wisconsin Fair Employment Act ("WFEA"). 

For at least 30 years, LIRC took the position that the WFEA makes it unlawful to discipline an employee for misconduct or poor performance that is caused by his or her disability, irrespective of the employer's intent or knowledge of any causal connection between the misconduct or poor performance and the employee's disability.  That is, LIRC essentially permitted employees to prove a discrimination claim without any proof that the employer actually engaged in intentional discrimination.  In Carlson, the Wisconsin Supreme Court was presented with its first opportunity to weigh in on LIRC's so-called "inference method" of proof of disability discrimination. In a significant victory for Wisconsin employers, the Court held that employees can no longer prove discrimination without evidence of discriminatory intent or that the employer knew the employee's misconduct or poor performance was caused by a disability.2

Factual Background

Charles Carlson worked for Wisconsin Bell as a call center representative. According to his psychiatrist, Carlson suffered from bipolar disorder, which caused him to experience episodes of mania followed by periods of depression, and relatively minor frustrations caused Carlson to experience extreme moods. 

In 2010, Carlson's manager observed him deliberately disconnect 12 customer calls in a ten-minute period of time, without explanation, in violation of company policy.  As a result, Carlson was suspended pending termination.  Carlson challenged the decision under the grievance process in a collective bargaining agreement, and presented two letters from his health care providers identifying his condition and generally describing some of its symptoms.  Neither stated, however, that Carlson's misconduct in hanging up on customers was caused by his psychiatric condition.  In recognition of Carlson's seniority, Wisconsin Bell imposed a 50-day unpaid suspension and offered Carlson reinstatement on a last chance agreement providing that further misconduct within one year would be cause for termination of his employment. 

In 2011, before the last chance agreement expired, Carlson used an idle health code intended for restroom breaks to block incoming calls for a period of 38 minutes when the call center was experiencing Code Red (i.e., peak call volume).  During this time, he used Wisconsin Bell's instant messaging system to communicate with 15 of his coworkers.  In so doing, Carlson accidentally sent a message intended for a coworker to his supervisor and then declared that he was leaving work early.

After reviewing Carlson's messaging activities, Wisconsin Bell confirmed that he had been misusing the health code to chat with coworkers.  Based on the tone and content of the messages, Carlson's supervisor concluded that he was not ill, and had merely been gossiping and chitchatting about personal matters (that he had failed a test to qualify for another position). Because Carlson improperly used an idle health code during a critical Code Red period, Wisconsin Bell suspended him pending termination for violating his last chance agreement.  Carlson grieved his suspension and claimed that during  a bipolar episode after receiving his test results he had reached out to coworkers for support, as suggested by his therapist.  During the grievance process, for the first time in connection with the incident, Carlson provided the Company with another letter from his health care provider  generally describing his bipolar disorder.  Like the previous letters, this one did not say Carlson's specific misconduct was caused by his condition.  The Company upheld Carlson's termination. 

Procedural History

Carlson filed two complaints with the State of Wisconsin Equal Rights Division of the Department of Workforce Development ("ERD"), claiming that Wisconsin Bell violated the WFEA by: (1) suspending him in 2010 and then terminating him in 2011 because of his disability; and (2) refusing to reasonably accommodate his disability.  After a hearing, the administrative law judge ("ALJ") determined that Carlson's misconduct was caused by his bipolar disorder and found in favor of Carlson on all claims.  

Wisconsin Bell appealed to LIRC, which likewise determined that Carlson's misconduct was caused by his bipolar disorder based on after-the-fact deposition testimony from his health care providers – information that Wisconsin Bell did not have at the time of its decision. On that basis, LIRC reasoned that Wisconsin Bell terminated his employment because of his disability.  LIRC terms this theory of discrimination the "inference method." 

Wisconsin Bell appealed LIRC's decision regarding the termination to the Milwaukee County Circuit Court, and the court remanded the case for further review of the sufficiency of evidence.  Wisconsin Bell then appealed to the Wisconsin Court of Appeals, which affirmed LIRC's decision.  The Court of Appeals agreed that an employer can be liable for disability discrimination when it takes an adverse employment action based on misconduct that is caused by an employee's disability regardless of whether the employer intended to discriminate or knew of a causal connection between the misconduct and the disability at the time it made the decision.  Wisconsin Bell then filed a petition for review with the Wisconsin Supreme Court, requesting that it correct LIRC's interpretation of the WFEA and reject the "inference method" of proving disability discrimination. 

The Wisconsin Supreme Court Strikes Down LIRC's Inference Method

The Carlson case marks the first time the Wisconsin Supreme Court has weighed in on whether LIRC's "inference method" is a viable way of proving discrimination "because of" a disability.  In a victory for Wisconsin employers, the Court concluded that LIRC's interpretation of the WFEA was unreasonable. For an employee to prove discrimination, the Court held, he or she must prove that the employer had a discriminatory intent at the time of its decision.  In scenarios like those in Carlson, where the employer disciplines the employee based upon misconduct, the employee can still demonstrate that requisite discriminatory intent.  However, contrary to LIRC's long-held position, to do so the employee must prove that the employer's decision resulted from the employer's contemporaneous knowledge of a causal connection between the employee's misconduct and his or her disability.  Absent such a required showing, the Court reasoned, employees with disabilities could arguably bring any form of misconduct under the protective cloak of the WFEA. 

The Court held that since Carlson failed to present any such evidence, he could not prove that his termination was discriminatory.  The letters from Carlson's health care providers described his condition in only general terms, and did not specifically put Wisconsin Bell on notice of any causal connection between the misconduct at issue and his disability.  Significantly, the Court held that, because of the "amorphous nature of [Carlson's] disability" – namely, extremes of mood that can occur quickly and are triggered by relatively minor frustrations – Wisconsin Bell was not required to accept Carlson's own assertions that his disability caused his misconduct. Rather, the Court explained, given the nature of his mental health condition, causality is not a matter of common knowledge evident to laypersons, and Carlson needed to provide Wisconsin Bell with proof of a causal connection as substantiated by an expert before the Company decided to terminate his employment.  Because he did not, Carlson failed to prove that Wisconsin Bell discriminated against him because of his disability.      

Although it remains to be seen how Wisconsin courts and agencies will apply the Carlson decision, the opinion likely will impact the decision-making processes of Wisconsin employers.3  Before Carlson, an employer could be liable for discrimination for disciplining an employee for poor performance even if it was unaware that the employee had a disability, let alone that the employee's poor performance was caused by a disability.  In light of the Court's conclusion and rationale, employers likely can have greater confidence in their ability to make disciplinary decisions based on the information available to them at the time of the decisions.


1 Wisconsin Bell, Inc. v. LIRC, 2018 WI 76, 2018 WL 3122231 (Wis. June 26, 2018).

2 Wisconsin Bell is represented by Laura Lindner of Littler Mendelson.

3 It is unclear, for example, whether courts and agencies will interpret Carlson  as barring employers from requiring an expert opinion where the employee's misconduct or poor performance is obviously disability-related.

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