- within Compliance topic(s)
Originally appeared in Labor and Employment Newsletter - February 2002
The Supreme Court opened its 2001-2002 term with a docket full of employment related cases. At the outset of the term, the Court had already accepted 15 employment cases for review - three times the number the Court had accepted at the beginning of its last term. Here are some of the highlights:
The Court’s First FMLA Case
In Ragsdale v. Wolverine Worldwide Inc., the Supreme Court will consider the validity of a Department of Labor ("DOL") regulation that provides that an employee’s leave of absence cannot be counted against the employee’s 12 weeks of FMLA leave if the employer fails to provide the employee with prior notice that the leave will be designated as FMLA leave and will be counted toward the employee’s 12-week allotment. (29 C.F.R. § 825.700). The Court of Appeals for the Eighth Circuit rejected the DOL regulation, reasoning that the regulation creates rights beyond those the statute confers in that the regulation might force an employer to provide much more than 12 weeks of leave. The Court of Appeals for the Eleventh Circuit has also rejected the regulation based upon similar reasoning, while the Court of Appeals for the Sixth Circuit recently endorsed the regulation.
Three ADA Cases For Review
In U.S. Airways Inc. v. Barnett, the Court will review a Court of Appeals for the Ninth Circuit decision holding that a unilaterally imposed seniority system is not a per se bar to reassignment as reasonable accommodation, but rather, should be considered as a factor in determining whether reassignment will pose an undue hardship to the employer.
In Chevron U.S.A. Inc. v. Echzabal, the Court will consider whether the ADA allows employers to exclude from particular jobs disabled workers who face a threat to their own health or safety, but do not pose a threat to anyone else in the workplace. The Court of Appeals for the Ninth Circuit, rejecting Equal Employment Opportunity Commissions rules, found that an employer may not use the ‘direct threat’ defense to exclude workers whose sole potential threat is to themselves. Mayer Brown & Platt’s Stephen Shapiro will argue this case on behalf of Chevron in the Supreme Court.
Limiting Backpay Awards for Undocumented Aliens
In Hoffman Plastic Compound, Inc. v. NLRB, the Supreme Court will consider whether and to what extent an award of back pay can be cut off to an employee who is an undocumented alien. In the underlying case, the NLRB held that the employer had illegally fired the employee for attempting to organize a union. During the course of the administrative proceedings, the employer discovered that the employee had lied about his identity and was not a U.S. citizen or authorized to work in the U.S. The NLRB awarded back pay for the period from the employee’s termination to the date the employer discovered the employee was an undocumented alien. The Court of Appeals for the District of Columbia Circuit upheld the NLRB’s limited back pay award.
ADEA Case
In Adams v. Florida Power Corporation, the Court will decide whether disparate impact claims are permitted under the Age Discrimination in Employment Act, an issue that has divided federal appeals courts since the Supreme Court itself left the issue unresolved in its 1993 decision in Hazen Paper Company v. Biggins. The Court recognized disparate impact claims under Title VII of the Civil Rights Act of 1964 in Griggs v. Duke Power Corporation, but stated in Hazen that it never decided whether Court of Appeals for the Ninth Circuit rejected the disparate impact claims of 117 plaintiffs who asserted that Florida Power violated the ADEA when over 70 percent of the workers selected for reduction in force where age 40 or over.
Two ERISA Cases
In Great-West Life & Annuity Co. v. Knudson, the Court will examine whether an employee benefit health plan can recover benefits paid on behalf of a plan participant injured in a car accident who later recovered tort damages from a third party. The Court of Appeals for the Ninth Circuit held that suits to enforce plan subrogation provisions do not fall within the scope of actions for equitable relief authorized by ERISA.
In Rush Prudential HMO Inc. v. Moran, the Court will consider whether ERISA pre-empts an Illinois law that requires external, independent review of medical-necessity decisions by HMOs. The Court of Appeals for the Seventh Circuit held that the Illinois law is not pre-empted. The Court of Appeals for the Fifth Circuit has held that a similar state law in Texas is pre-empted.
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