Alaska Employment Law

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Court of Appeals Affirms Judge Sedwick; Result may Differ under Alaska Law  

The City of Mesa, Arizona, required Christine Nilsson, an applicant for a police position, to waive any claims arising out of the City’s pending investigation of her background.  After she complied, the investigation proceeded and revealed an EEOC dispute with a previous employer, workers comp claims, and a “labor board” matter.  The City first rejected Nilsson’s application, but then extended her a job offer if she passed a psychological exam.  She failed the exam.  Nilsson then filed Title VII and ADA claims with the EEOC.  She sued the City of Mesa on those, as well as § 1983 and various state grounds. 

Judge John Sedwick, sitting in the District of Arizona, granted summary judgment to the City on the basis of Nilsson’s pre-investigation waiver of claims.  On appeal, the 9th Circuit affirmed Sedwick, though on somewhat different grounds.

The Court of Appeals applied federal law to the purported waiver of federal claims, and affirmed Sedwick’s holding that the pre-investigation release/waiver form was effective as to the § 1983 and ADA claims.  In so doing, the Court relied on Stroman v. West Coast Grocery Co., 884 F.2d 458 (9th Cir. 1989), which upheld the validity of a release negotiated after the employee had asserted various claims.  The Stroman court (and now the Nilsson court) examined whether the employee’s waiver was “voluntary, deliberate, and informed.”  The Court apparently did not find the difference in the timing of the execution of Nilsson’s release to be significant.  Under federal law, the release was valid despite the absence of any recitation of the particular statutory claims, and despite the employee’s failure/decison not to consult with counsel.

As to the Title VII claim, the Court first noted that Title VII waivers are held to a higher standard than § 1983 and ADA waivers, and then found that the claim relied on non-investigatory conduct and thus was not covered by the waiver.  On examining the merits of the Title VII claim, the Court held that Nilsson had failed to raise a genuine issue of material fact regarding pretext.  The City introduced evidence that it had rejected Nilsson because she had failed the psychological exam, i.e., independently of the City’s knowledge of her protected activity.  The Court also held that Nilsson failed to present any evidence that the psychologist’s opinion was based on anything other than “a legitimate psychological evaluation.”

The 9th Circuit affirmed the dismissal of most of Nilsson’s state claims because she had failed to meet agency filing requirements.

Comment

Waivers of federal rights: Can it really be the case that an employer could have all job applicants waive the right to file Title VII claims over any discrimination or harassment that happens on the job?  While Nilsson’s waiver was limited to claims based on conduct during the investigation period, nothing in the court’s rationale depends on the uniqueness of that stage in the employment process. 

The 9th Circuit would presumably still permit Nilsson to file an EEOC charge (but not recover via the EEOC).  See EEOC Enforcement Guidance on Non-Waivable Employee Rights.  

Waivers of state rights: Alaska and 9th Circuit federal law may differ materially on waiver of future claims.  Alaska public policy disfavors waiver of unaccrued claims:

Normally agreements between private parties are upheld and enforced by courts. However, authorities hold that an agreement exempting a party from liability for future willful or negligent conduct should not be enforced where the interest of the public is involved. See Restatement (Second) of Contracts § 195 (1981). Professor Williston observes that even where such an agreement is valid, it is “not favored, however, and, if possible, bargains are construed not to confer this immunity.” 15 Williston on Contracts § 1750A, at 144 (3d ed. 1972). The [plaintiffs] have not expressly waived future defenses in the clause at issue. Moreover, because such a waiver is disfavored, we will not infer it.

Wassink v. Hawkins, 763 P.2d 971, 975 (Alaska 1988).  Because discrimination claims are claims of intentional conduct that often implicate public as well as private concerns, waiver of future discrimination claims under Alaska law should not only be “disfavored” but rejected.   See also Ledgends, Inc. v. Kerr, 91 P.3d 960 (Alaska 2004)(narrowing construing exculpatory provisions re future personal injury claims based on negligence).

If that analysis is correct, the same claim will survive a waiver defense in a Title 18 action, but fall to a waiver defense in a federal action.

Nilsson v. City of Mesa, 2007 WL 2669788 (9th Cir. Sept. 13, 2007).

UPDATE: As Paul Mollica, Rick Seymour, and others have noted: The Supreme Court in Alexander v. Gardner-Denver Co., 415 US 36, 51 (1974), stated,  “To begin, we think it clear that there can be no prospective waiver of an employee’s rights under Title VII.”