The U.S. Court of Appeals for the Eighth Circuit has, for the second time, reversed and remanded a railroad employment case. Both reversals were based on jury instructions the Court deemed erroneous.
Edward Blackorby was an employee of the BNSF Railway. He sustained an eye injury while on duty, but the existence and severity of the injury was not immediately apparent. Several days after Blackorby experienced eye irritation at work, a doctor removed a small metal shard from his eye.
Shortly after the shard was removed, Blackorby notified his supervisor of the injury. According to Blackorby, his supervisors discouraged him from reporting the injury by telling Blackorby that he would be investigated for not reporting the injury immediately after it occurred. Nevertheless, Blackorby filed a formal injury report and was later notified by BNSF that he would be investigated. After the investigation, BNSF assessed discipline against Blackorby for a late report of personal injury.
Blackorby filed a complaint with OSHA based on alleged violations of the whistleblower provisions of the Federal Rail Safety Act, 49 U.S.C. §20109. OSHA determined that BNSF violated Blackorby’s rights under the FRSA. These findings were challenged before an administrative law judge, but while the challenge was pending, Blackorby filed the present lawsuit in federal court for de novo review.
The case was tried to a jury, which was instructed that Blackorby was not required to show that BNSF had a retaliatory motive in disciplining him. The jury returned a verdict for Blackorby and awarded him $58,240 in damages. The 8th Circuit reversed and remanded, holding that the jury instruction was erroneous, because Blackorby was in fact required to show that BNSF acted with retaliatory animus. Blackorby v. BNSF Railway Co., 849 F. 3d 716 (8th Cir. 2017).
On remand, the court held a second jury trial on liability only. This time, the jury returned a verdict for BNSF. On appeal, Blackorby challenged several of the trial court’s instructions to the jury. The 8th Circuit again agreed that the trial court committed prejudicial instructional error. Blackorby v. BNSF Railway Co., No. 18-2372 (8th Cir. 2019).
First, the 8th Circuit found error in an instruction stating that BNSF could not be held liable if it disciplined Blackorby based on an honestly held belief that he engaged in misconduct or committed a rules violation. The Court held that liability can still exist notwithstanding such a belief, (1) if the employer’s retaliatory motive also contributed to the decision to discipline, and (2) if the employer fails to carry the burden of proving by clear and convincing evidence that it would have taken the same action in the absence of the protected activity.
The Court also determined that the instructions were erroneous because they misallocated and misstated the burden of proof. The instructions erroneously described the “honestly held belief” issue as part of Blackorby’s prima facie case and not a part of BNSF’s burden under the “clear-and-convincing-evidence standard”. The case was remanded to the District Court where we anticipate the case will again be tried before a jury with modified instructions.
The Eighth Circuit has issued a reminder to those seeking to bind employees and consumers to arbitrate future disagreements: don’t gloss over contract basics.
In Shockley v. PrimeLending, 929 F.3d 1012, Jennifer Shockley sued her former employer under the Fair Labor Standards Act, alleging she was not paid for all earned wages and overtime pay. PrimeLending moved the district court to compel arbitration based on a mandatory arbitration provision contained in its employee handbook. The district court denied the motion because it found no agreement to arbitrate existed between Shockley and the company. PrimeLending appealed the denial to the Eighth Circuit, which affirmed the district court’s denial for the same reason.
The Court reiterated in the Shockley opinion that arbitration agreements are favored by federal law and are enforced as long as the agreements are valid, and the dispute at issue falls within the scope of the agreement. Whether parties can be compelled to arbitrate any given dispute is a matter of contract law. Thus, while arbitration is preferred, parties may only be compelled to arbitrate if they contractually agreed to be bound by arbitration. A party seeking to compel arbitration must therefore show, as a threshold matter, that a valid and enforceable agreement to arbitrate exists. To do so, the three elements of a contract – offer, acceptance, and consideration – must be proven.
Like most large employers today, PrimeLending made its employee handbook accessible electronically, and as part of Shockley’s required annual policy review, the click of a mouse on the handbook in PrimeLending’s computer network automatically generated an acknowledgement of review. PrimeLending employed Shockley for 13 months. In that time, Shockley completed the policy review process twice. PrimeLending claimed the two e-acknowledgments and Shockley’s continued employment with the company were sufficient to carry its burden to prove Shockley accepted the arbitration provisions contained in the handbook. Both the district court and the Eighth Circuit held these facts were insufficient to prove Shockley accepted any purported offer related to arbitration.
The employment handbook contained two arbitration-related provisions: (1) a “delegation provision”, and (2) a run-of-the-mill arbitration provision. A delegation provision is an agreement to arbitrate threshold issues concerning the arbitration agreement, mainly placing “gateway questions of arbitrability into the hands of an arbitrator.” In other words, a delegation provision is a separate agreement within the agreement to arbitrate, which, if valid, mandates that certain issues be determined by an arbitrator rather than by a judge before the core dispute is arbitrated. When successful, the challenge of a delegation provision renders the remainder of an arbitration agreement open to review by the courts. Accordingly, the Eighth Circuit in Shockley first reviewed the delegation provision contained in the handbook.
The Eighth Circuit assumed, for the sake of discussion, that the delegation provision at issue constituted an offer. And it then reviewed the record to determine whether Shockley accepted the purported offer. Under Missouri law, “mere continuation of employment [does not] manifest the necessary assent to [the] terms of arbitration.” While continued employment may in some circumstances constitute acceptance when the employer informs all employees that continued employment constitutes acceptance, no such message was relayed to PrimeLending employees. Thus, Shockley’s continued employment was not evidence that she accepted the delegation offer contained in the employee handbook. Next, the Court entertained the e-acknowledgments as means of Shockley’s acceptance.
Specifically, the Court explained that acceptance is present when the offeree (here, Shockley) – the person receiving the offer – signifies assent in a “positive and unambiguous” manner generally by affirmative words or action to the terms of the offer. The Court outlined the pertinent facts: Shockley’s initial review of the handbook was not conditioned on her offer of employment, she had no memory of reviewing the handbook, nor did the record establish she actually reviewed the handbook. The Court held that PrimeLending could, at best, show Shockley acknowledged the existence of the arbitration provisions and was thus aware of the terms of her then-employer’s purported contract offer. The Court held that Shockley’s review of the handbook and the subsequent system-generated acknowledgment did not create clear acceptance and therefore no contract was created.
Following review of the delegation provision, the Court turned its attention to the arbitration provision. Because both the delegation and arbitration provisions are grounded in contracts law and involve the same set of facts, the Court succinctly explained that the legal analysis of the arbitration provision was the same as analysis of the delegation provision, and that both analyses suffered from the same fatal flaw. The fact that the Court could not find that Shockley accepted any purported offer was dispositive of both analyses. Thus, PrimeLending failed to meet its burden to prove a valid agreement to arbitrate existed and the Court could not compel Shockley to arbitrate her claims.
The lesson for businesses seeking to compel arbitration of employee or consumer claims is clear: the “offeree” of the arbitration clause should be asked, in the first instance, to affirmatively accept the arbitration clause.
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Attorneys: Elizabeth Miller
The Americans with Disabilities Act (“ADA”) prohibits employers from discriminating against a qualified individual on the basis of a disability. In 2008, Congress amended the ADA, to ensure that the ADA’s definition of disability was construed broadly. The amendment added a “regarded as” disabled component, meaning that applicants and employees who cannot prove that they have an actual disability within the meaning of the ADA may still be able to show that their employer regarded them as having such a disability. This broader reading provides obese plaintiffs a greater opportunity for success in disability discrimination claims; however, this amendment has created differences in interpretation regarding the extent to which obesity is considered a disability under the ADA.
The Seventh Circuit is the Fourth Federal Appeals Court to Hold That Obesity, Alone, is Not a Protected Disability Under the ADA.
On June 12, 2019, the Seventh Circuit Court of Appeals joined the Second, Sixth, and Eighth Circuits holding obesity must be the result of an underlying physiological disorder to qualify as a disability under the ADA in the case of Richardson v. Chicago Transit Authority. In Richardson the plaintiff, a bus driver who weighed over 400 pounds took medical leave due to hypertension and influenza. After he resolved the medical issues and was deemed fit to return to work, his employer required him to take an assessment because the bus seats were not designed to accommodate drivers over 400 pounds. The assessment determined that the plaintiff could not make hand-over-hand turns, he simultaneously used both of his feet on the gas and brake pedals, and he rested his leg near the door handle. His employer transferred him because of safety concerns regarding his operation of the equipment in question. He sued under the ADA, claiming that he should be “regarded as” disabled due to his obesity. The Seventh Circuit affirmed summary judgment for the employer. The court determined that under the ADA, the plaintiff must allege that he suffers from a medical impairment, and that obesity is a physical characteristic -- not an impairment -- and should not be regarded as an impairment.
The Second, Sixth, Eighth, and now Seventh Circuit Courts are applying what they consider a “natural reading” of the EEOC’s interpretative guidance. This reading concludes that physical characteristics, such as obesity, that are not the result of a physiological disorder do not qualify as a disability under the ADA. The opinion in Richardson suggests that if claims for obesity without an underlying physiological condition are allowed, interpretation of what could be “regarded as” a disability would become overly broad and open the court to results that are inconsistent with the ADA’s text and purpose, including potential claims for weight-based claims from individuals with weight slightly outside of a normal range without any physiological basis as the cause, and making the “regarded as” amendment a catch-all for discrimination based on appearance, size, and more, none of which are disabilities the ADA was designed to protect.
What Are Other Jurisdictions Saying?
In the First Circuit case of Cook v. State of R.I., Dept. of Mental Health, Retardation, & Hosps., the First Circuit held that obesity, by itself, should be protected without evidence of an underlying physiological disease or disorder. The Court took the position that the issue is a question of fact for a jury to decide.
Likewise, although the Fifth Circuit has not directly ruled on this issue, a case arising in the U.S. District Court for the Eastern District of Louisiana, a federal trial court within the Fifth Circuit, EEOC v. Res. for Human Dev., Inc., held that severe obesity can be a disability under the ADA, without evidence of an underlying physiological disorder.
Lastly, a 2018 Ninth Circuit case, Taylor v. Burlington N.R.R. Holdings, Inc., arising under Washington’s state anti-discrimination law, involved a plaintiff who was rejected for a job because he was considered outside of the company’s weight standards for the position. The Court certified to the Washington Supreme Court for guidance the question of under which circumstances obesity qualified as an impairment under the state law. Interestingly, although not arising under the ADA, the EEOC filed a brief in the case, arguing that weight is not an impairment when it is within the “normal” range and lacks a physiological cause, but may be an impairment when it is either outside the “normal” range or occurs as the result of a physiological disorder. The Ninth Circuit acknowledges that whether obesity is to be “regarded as” a disability under the ADA remains an open question in that jurisdiction. The Washington Supreme Court responded this year that obesity is an impairment under the Washington law.
Guidance for the Future
The Second, Sixth, Seventh, and Eighth Circuits “natural reading” of the EEOC’s interpretative guidance rejects the EEOC’s stance that obesity should be “regarded as” a disability. The Richardson opinion makes clear that a court can reject a federal agency’s interpretation when they feel that deference to the agency is inconsistent with the regulation. However, employers should proceed cautiously when taking adverse action against an employee due to obesity and should ensure compliance with the law in their particular jurisdiction. The scope of obesity as a disability is divided amongst circuits and remains a question of fact in others, and the ADA may still protect an employee if there is evidence that an underlying physiological condition causes the employees obesity.
* Jasmine Riddick, Summer Law Clerk, assisted in the research and drafting of this post. Riddick is a rising 2L student at Emory University in Atlanta, Georgia.
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