Alaska Employment Law

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Introduction

In an amended opinion issued July 20, 2007, Poland v. Chertoff, ___ F.3d ___, 2007 WL 2069651 (9th Cir. 2007), the Ninth Circuit held that a subordinate’s animus could be imputed to an employer if the plaintiff could show that the subordinate “influenced or was involved in the decision or decisionmaking process.” In reaching this conclusion, the court rejected the so-called “cat’s paw” theory from the Fourth Circuit that imputes a subordinate’s impermissible motive to the employer only when the subordinate dominates the underlying investigation and the ultimate decision is little more than a rubber stamp reflecting the subordinate’s animus. This summary briefly discusses the case and its significance.

The Case

James Poland worked for the Customs Service. After a lengthy career, he accepted a position as the Resident Agent in Charge of the Portland, Oregon office. He reported to Gary Hillberry, the Special Agent in Charge in Denver. Hillberry made frequent comments concerning Poland’s age and took other actions reflecting an age-related bias. Poland filed an age discrimination charge. Hillberry subsequently ordered an investigation into Poland’s job performance. A review board concluded that there was insufficient evidence for any adverse employment action, but decided it would be in the agency’s best interests to transfer Poland to a non-supervisory position. Poland was transferred to Virginia.  He accepted the transfer, but resigned shortly thereafter.

Poland filed suit alleging three age discrimination theories: (1) failure to promote; (2) retaliation; and (3) constructive discharge. The district court presided over a bench trial. It rejected Poland’s failure to promote theory, but ruled in his favor on the retaliation and constructive discharge theories. The Customs Service appealed.

The Opinion

In a 2-1 split, the Ninth Circuit affirmed in part and reversed. Writing for all three judges on the panel, Judge Gould concluded that Poland’s retaliation claim was valid. The Customs Service argued that any alleged impermissible motive attributable to Hillberry was insulated from the decision to transfer Poland because an impartial review board made that decision. The court agreed that Hillberry’s action in requesting an investigation would not have been enough to impute liability.  However, he took other steps such as making his initial memo available to the board, providing the board with names of witnesses to interview, and submitting memos with negative comments about Poland to the board.  All of these additional acts established that Hillberry influenced or was involved in the decisionmaking process.

 

Goldilocks analysis

In arguing for reversal, the Customs Service urged the court to adopt the Fourth Circuit’s “cat’s paw” test by which the subordinate’s improper motive is imputed only in those rare cases where the subordinate dominates the investigation to the extent that the ultimate decision is little more than a rubber stamp reflecting the subordinate’s animus.  The court rejected this approach as being too narrow.  The court also rejected a more lenient “but/for” test by which the employer would be liable anytime a biased employee set in motion the process leading to a challenged decision.  In between these extremes, the court settled on an intermediate test by which a subordinate’s animus is imputed to an employer if the plaintiff can show that the subordinate “influenced or was involved in the decision or decisionmaking process.”  The court viewed this test as representing a proper application of general causation principles. 

No constructive discharge

In addition to its holding on the retaliation theory, the majority also reversed the district court’s ruling in favor of Poland on his constructive discharge theory.  The majority concluded there was insufficient evidence to support a constructive discharge because Poland worked for five months in Virginia before deciding to take an early retirement, and then worked in the same position for three additional months before retiring. This, the majority determined, was inadequate to establish that the working conditions were unreasonably intolerable.  Judge Paez, a former district court judge, dissented with respect to the majority’s constructive discharge holding.  In his view, appropriate deference to the trier of fact required application of the clearly erroneous standard of review, and under that standard there was sufficient evidence to support a constructive discharge. 

Significance

The “cat’s paw” theory narrowly escaped review by the United States Supreme Court in the recently concluded Term when a case for which certiorari issued, EEOC v. BCI Coca-Cola Bottling Co. of LA, 450 F.3d 476 (10th Cir. 2006), ultimately settled before the case could be heard.  We are therefore left with a Circuit split with the Fourth Circuit’s test representing a minority view.  Otherwise, the Ninth Circuit’s decision seems compatible with most of its sister Circuits and appears to be consistent with its existing precedent.   It seems an appropriate use of causation principles, too.

Questions remain, however, concerning how employers may insulate their decisions from unknown biases harbored by subordinates.  In concept, one would think that employers should be able to screen out improper motives by taking steps to ensure that their decisions are fair in form and function—for example, by trying to reach objectively impartial decisions based on reasonable investigations.  This begs the question, however, of what constitutes a “reasonable” investigation?  Does it imply traces of due process principles that would otherwise not constrain private employers’ decisions?  See, e.g., BCI, 450 F.3d at 488 (employer should ask employee “for his version of events”).  It is also unclear whether the same principles will apply to large and small employers.  Here, for example, the Customs Service is a large public agency with inquiry panels, review boards, and decision makers based in distant cities.  Yet, notwithstanding these instruments designed to foster impartial decisions, Hillberry’s animus was nevertheless imputed to the Customs Service because he had undertaken steps that were consistent with his duties as Poland’s supervisor.  These and other wrinkles will have to be ironed out in the future.   In hindsight, however, the Customs Service should have re-assigned Poland to a new supervisor or punted the investigation to an independent actor.

The case also demonstrates the importance of retaliation theories. Poland ultimately lost his substantive discrimination theories, yet prevailed based on the retaliation theory.  The lesson should not be missed. Where supported by the evidence, employers may still of course discipline employees even if the employees happen to have filed employment discrimination charges or participated in proceedings addressing those charges.  However, employers should take steps to ensure that any decision is reasonable, reasonably related to a legitimate non-discriminatory reason, and - to the extent possible - unconnected to anyone involved in a pending employment discrimination charge or proceeding.

Conclusion

This summary is intended for informational purposes, and is not intended as legal advice on any particular case.

Gregory S. Fisher, Atty., Birch Horton Bittner and Cherot, 1127 W. 7th Avenue, Anchorage, AK 99501 (907) 276-1550 gfisher@bhb.com  J.D. University of Washington School of Law (1991), Washington Law Review, B.A. with honors, S.U.N.Y. Binghamton (1988).