In the last decade, the number of charges filed with the Equal Employment Opportunity Commission alleging retaliation has more than doubled, from 7,900 in 1991 to 19,691 in 1999. These types of claims now represent more than 1/4 of all charges in all categories filed with the EEOC.
There are several reasons for such tremendous growth. First, numerous federal and state statutory schemes provide employees with protection from retaliation in the employment context. Second, the majority of statutes do not strictly define the type of conduct that constitutes protected activity. Third, jury verdict research indicates there is a 57% chance of an employee receiving a favorable jury verdict when a retaliation claim is asserted. Fourth, many employees are beginning to realize they can sue their employers while still actively working. Thus, there is less risk of lost earnings — simply sue your boss from the comfort of your desk. Finally, because of the inherent nature of retaliation claims, juries tend to return substantial awards, primarily punitive damages.
Recent Jury Awards and Out-Of-Court Settlements in Retaliation Lawsuits
Recent jury awards and out-of-court settlements illustrate the potential risk in retaliation lawsuits. An Iowa jury recently awarded $80.2 million in punitive damages and $527,872 in compensatory damages to a manager who claimed she was discriminated against because of her sex and retaliated against when she complained of the discrimination.1
According to her complaint, when the manager reported the harassing and discriminatory conduct to her employer, it retaliated against her by moving her to a new position and threatening her with a demotion. Similarly, a jury in Massachusetts awarded $4 million to a Russian immigrant security guard who was fired from his job after he complained of national origin discriminatory treatment.2 And in California, a jury awarded $40 million in punitive damages to an African-American employee who claimed he had not been promoted in retaliation for having previously complained of race discrimination.3 In a case brought by the EEOC, one of nation's largest lettuce growers paid $1.9 million to settle EEOC charges that it allowed female employees to suffer sexual harassment and retaliation after they complained of discrimination.4
What are the Legal Grounds for Retaliation?
Numerous federal statutes provide employees with protection against workplace retaliation. In addition, many states recognize a "public policy" exception to employment at will and allow wrongful discharge claims, as well as claims for retaliation under workers' compensation statutes.
Numerous Federal Employment Statutes Expressly Prohibit Retaliation
Potential plaintiffs have a broad array of federal statutes to support claims of actual — or perceived — retaliation. For example, retaliation against employees who oppose unlawful employment discrimination is expressly prohibited by Title VII of the Civil Rights Act of 1964, the Age Discrimination In Employment Act, and the Americans With Disabilities Act. In addition, the Fair Labor Standards Act prohibits retaliation against employees who file claims for unpaid wages; the Occupational Safety and Health Act prohibits reprisals against employees who exercise rights granted to them by OSHA; the Family and Medical Leave Act prohibits employers from interfering with an employee's exercise of rights under the Act; and the National Labor Relations Act pr ohibits retaliation against employees for engaging in union organizing efforts and other concerted activities.
...And State Laws Get into the Act Too
In addition to (or in place of) whistleblower protection laws, some states recognize retaliation claims based on violations of "public policy." Employer conduct which violates public policy may involve an allegedly illegal act, violation of safety regulations, environmental hazard, or violation of internal corporate procedures. For instance, a federal jury awarded a Connecticut state investigator $2.7 million after finding that Connecticut's Chief State Attorney retaliated against him for speaking out against what he believed to be misconduct in a joint state-federal investigation.5 In another case, a company that fired an employee in retaliation for testifying at fellow employee's unemployment benefits hearing violated California public policy, even though there was no specific statute prohibiting discharge.6
The Sleeping Giant: Retaliation in Workers' Compensation Claims
Employees may also assert retaliation claims based up on their participation in workers' compensation proceedings. Where jury trials are permitted, workers' compensation retaliation cases often result in substantial monetary damages, as for example, in a Texas case a jury awarded $10 million in punitive damages to five employees claiming they were retaliated against for filing workers' compensation claims,7and a California jury awarded $850,000 to a sales manager alleging he was terminated in retaliation for filing a workers' compensation claim.8 In our experience, such claims are becoming a frequent consequence of ill-considered disciplinary actions for absenteeism.
What are the Elements of an Actionable Claim of Retaliation?
Under Title VII, the ADA and the ADEA, there are two types of retaliation claims.
- "Opposition" claims are brought by individuals who claim they were retaliated against because they opposed a practice made unlawful by one of the aforementioned statutes. This type of claim does not require the filing or registering of a formal complaint.
- "Participation" claims are brought by individuals claiming retaliation for filing a charge of discrimination, testifying, assisting or participating in any manner in an investigation, proceeding or hearing under the applicable statute.
How Do Plaintiffs Recover Under a "Participation Claim"?
Any form of participation in a proceeding under one of the listed statutes is protected regardless of whether the allegations in the original charge were valid or reasonable. The individual claiming retaliation does not have to be the person who directly challenged the practices in the statutory proceeding. For instance, the EEOC recently sued a railroad company for retaliation for eliminating her position after she testified in a national origin case brought by another employee.9
Nevertheless, to successfully assert a retaliation claim, the claimant must have been subjected to some "adverse action" by the employer. Many types of adverse action can form the basis for a retaliation claim; namely, denial of promotion, refusal to hire, denial of job benefits, demotion, suspension, discharge, or subjection to severe and pervasive harassment. For example, a female disc jockey was awarded $1.25 million in punitive damages because she was subjected to intolerable working conditions in retaliation for filing a charge of pregnancy discrimination with the EEOC.10 Other employer actions recently found to be unlawful retaliation include the transfer of an employee to a position with different and more difficult job responsibilities and filing a false police report about an employee after the employee informed the company of his national origin discrimination charge.
How Do Plaintiffs Recover Under an "Opposition Claim"?
A broad range of circumstances have been held to constitute "protected activity" sufficient to support opposition claims:
- Threatening to file a charge or other formal complaint alleging discrimination;
- Complaining to anyone about alleged discrimination against oneself or others;
- Refusing to obey an order because of a reasonable belief that it is discriminatory;
- Requesting reasonable accommodation for disability or religious belief.
Nonetheless, the manner of opposition must be reasonable, that is, the opposition must be based upon a reasonable and good-faith belief discrimination actually occurred. Notably, however, the person claiming retaliation need not be the person who engaged in the opposition — but need only to be related or "associated" with that person, e.g., a family member or spouse.
The Wages of Sin: Remedies for Retaliation
Under Title VII, the ADA and the ADEA, courts may issue temporary or injunctive relief, such as a restraining order, against the employer if (i) the challenged action is likely to constitute unlawful retaliation, and (2) the individual plaintiff (or the EEOC) is likely to suffer irreparable harm because of the retaliation. Injunctive or temporary relief, however, is not authorized under the ADEA or the Equal Pay Act.
Both compensatory and punitive damages are available under Title VII and the ADA, subject to a statutory limit. While compensatory and punitive damages are not available under the EPA and ADEA, prevailing employees can recover "liquidated" damages (a doubling of wage/economic losses) if they establish a "willful" violation of their statutory rights. State human rights laws, wrongful discharge and public policy violations, and workers' compensation claims may give rise to unlimited punitive damage awards.
Defenses available to employers in retaliation lawsuits
There are three principal defenses available to employers involved in retaliation lawsuits:
- There is no evidence any adverse action resulted from the employee's opposition or participation.
- The employer was unaware of the employee's protected activities.
- The employee's claim does not state a cause of action for retaliation.
Prevention of Retaliation Claims:
... When the Individual Is Not Already Pursuing Formal Proceedings Against the Employer
Employers should create a working environment in which employees feel they can alert management to potential problems and participate in investigations without fear of retaliation. Ensuring consistent administration of policies and responding appropriately and promptly once a complaint is made are the best ways to prevent retaliation claims. Management should reassure the employee lodging the complaint or participating in the investigation, he or she will suffer no retaliation as a result.
Thus, to reduce the likelihood that an employee or former employee will have grounds to assert a retaliation claim for opposing an allegedly discriminatory practice or participating in an agency proceeding or court case, employers should be encouraged to:
- Have a credible complaint procedure and promptly and thoroughly investigate all complaints. Assure the employee the complaint is being taken seriously and all efforts will be made to conduct the investigation promptly and discreetly.
- Be sensitive and thank the employee for the information provided. Remind the employee of the company's commitment to equal employment opportunity, and let the employee know he or she has done the right thing in coming forward.
- Assure employees that retaliation will not be tolerated. Ask the employee to report any further experiences or events resulting from the complaint or participation in the investigation.
- Put yourself in the employee's shoes. Bear in mind the employee may be more sensitive after lodging a complaint or participating in an investigation. Incidents of little consequence may appear retaliatory. Therefore, develop a sensitivity to subtle nuances and make a conscious effort to keep the employee involved in the everyday business of the workplace.
...And When The Individual In Question Has Initiated Formal Proceedings Against the Company
To avoid the perception of retaliation following the filing of a formal charge or complaint by an employee, the employer must monitor all of its actions involving that individual to ensure they are nondiscriminatory and consistent with past practices. This is particularly true when preparing to settle a lawsuit or resolve an agency charge, as the employer is in an especially vulnerable position with regard to even the routine matters of personnel administration, such as distribution of assignments, staff scheduling, approval of requests for time off, and conducting performance and salary reviews.
Despite these and other precautions, the timing of a disciplinary action or an unsatisfactory performance review may appear to support a claim of retaliation, especially if the underlying behavior has not been fully documented. In those instances, human resource professionals should confer with employment law counsel regarding the best way to proceed.
Res Ipsa Loquitur (The Thing Speaks for Itself)
Recent jury verdicts and out of court settlements underscore the need for EPLI underwriters, claims adjusters and employers to anticipate and minimize the risks of employment litigation. These cases confirm that retaliation claims have compounded the already explosive area of employment litigation.
$13 Million in Punitive Damages: A jury found a pizza restaurant chain liable under the Americans with Disabilities Act (ADA) for firing a mentally retarded janitor. The federal district court subsequently reduced that amount as required by the ADA, but imposed the maximum allowed under federal law. In so ruling, the court noted that "the breathtaking magnitude of an eight-figure punitive damages award demonstrates that the jury wanted to send a loud, clear message." EEOC v. CEC Entertainment, Inc., d/b/a Chuck E. Cheese Pizza, WD Wis, 2000.
$1.25 Million: Racial discrimination lawsuit was brought by a former television news producer who claimed she was fired because she was black. Despite winning four Emmy awards in three and one-half years as producer, the company terminated her employment for poor work performance. Dickson v. Scripps Howard Broadcasting Co. d/b/a WEWS, ND Ohio,1999.
$4.5 Million, including $332,000 attorneys' fees: A New Jersey jury found a bank had terminated two branch managers because of age and gender discrimination during a reduction in force. Baker v. New Jersey National Bank, Middlesex County Superior Court,1999.
$1.5 Million: A New Jersey jury returned a verdict in favor of the employee, finding age discrimination in connection with two potential promotions and retaliation for filing an age discrimination claim. The award consisted of more than $220,000 in compensatory damage and $1 million in punitive damages, plus costs and fees. Cavouti v. New Jersey Transit Corp.,Superior Court of New Jersey,1999.
$1.3 Million: Racial and sexual harassment lawsuit brought by the EEOC against a Chicago construction company was settled on behalf of approximately 100 African-American and/or female former employees. The company also was required to implement an anti-harassment policy, provide training to its managers and workforce and make periodic reports to the EEOC regarding any complaints received about racial or sexual harassment at its work sites throughout the United States during the next two years.
