Justia Labor & Employment Law Opinion Summaries
Kramer v. American Electric Power Service Corp. Executive Severance Plan
Derek Kramer, the plaintiff, joined American Electric Power Service Corporation (AEP) in 2018 and later participated in the AEP Executive Severance Plan. In 2020, AEP terminated Kramer’s employment due to his executive assistant’s misuse of a company credit card and Kramer’s alleged interference with an investigation into his company-issued cell phone. Kramer applied for severance benefits under the Plan, but AEP denied his claim, citing termination for cause. Kramer appealed the decision, but the Plan’s appeal committee upheld the denial.Kramer then filed an ERISA action in the United States District Court for the Southern District of Ohio, seeking benefits and alleging interference. He also demanded a jury trial. The district court struck his jury demand, limited discovery to procedural claims, and denied his motion to compel the production of documents protected by attorney-client privilege. The court ultimately granted judgment in favor of AEP and the Plan, finding that the denial of benefits was not arbitrary and capricious.The United States Court of Appeals for the Sixth Circuit reviewed the case. The court affirmed the district court’s rulings, holding that the Plan was a top-hat plan exempt from ERISA’s fiduciary requirements, thus the fiduciary exception to attorney-client privilege did not apply. The court also upheld the district court’s decision to strike Kramer’s jury demand, citing precedent that ERISA denial-of-benefits claims are equitable in nature and not subject to jury trials. Finally, the court found that the district court correctly applied the arbitrary-and-capricious standard in reviewing the denial of benefits and that the decision was supported by substantial evidence. The Sixth Circuit affirmed the district court’s judgment in favor of AEP and the Plan. View "Kramer v. American Electric Power Service Corp. Executive Severance Plan" on Justia Law
Xerox Corporation v. Local 14A, Rochester Regional Joint Board, Xerographic Division Workers United
Xerox Corporation filed a petition under Section 301 of the Labor Management Relations Act (LMRA) for injunctive and declaratory relief against Local 14A, Rochester Regional Joint Board, Xerographic Division Workers United (the Union). After the collective bargaining agreement (CBA) between Xerox and the Union expired, Xerox terminated retiree benefits. The Union argued that Xerox could not unilaterally terminate vested benefits and sought to enforce the expired agreement’s arbitration provision. Xerox sought to stay and enjoin arbitration.The United States District Court for the Western District of New York granted Xerox’s petition, concluding that the Union’s grievance was not arbitrable under the expired CBA. The district court reasoned that the Union failed to identify language in the agreement that could be understood to have promised vested benefits beyond the agreement’s expiration. Additionally, the reservation-of-rights clause in plan documents barred an interpretation that benefits had vested.On appeal, the Union argued that the district court erred. The United States Court of Appeals for the Second Circuit agreed with the Union. The appellate court found that the Union identified language that could be reasonably understood as guaranteeing benefits beyond the contract’s expiration or as constituting deferred compensation. Furthermore, the reservation-of-rights clause in plan documents did not conclusively bar an interpretation that benefits had vested. To discern the parties’ intent, the appropriate trier of fact would need to consult extrinsic evidence.Accordingly, the Second Circuit vacated the district court’s judgment and remanded the case for further proceedings. View "Xerox Corporation v. Local 14A, Rochester Regional Joint Board, Xerographic Division Workers United" on Justia Law
Vo v. Technology Credit Union
Thomas Vo signed an employment arbitration agreement with Technology Credit Union (TCU) before starting his job in 2020. The agreement required both parties to submit any employment-related disputes to binding arbitration. Vo was later terminated and sued TCU for violations of the Fair Employment and Housing Act (FEHA), including harassment, discrimination, and wrongful termination. TCU moved to compel arbitration, but Vo opposed, arguing the agreement was unconscionable because it did not allow for prehearing third-party discovery.The Santa Clara County Superior Court found the arbitration agreement procedurally unconscionable as a contract of adhesion and substantively unconscionable because it did not permit third-party discovery, relying on Aixtron, Inc. v. Veeco Instruments Inc. The court denied TCU's motion to compel arbitration, leading TCU to appeal the decision.The California Court of Appeal, Sixth Appellate District, reviewed the case de novo. The court found that while the agreement was procedurally unconscionable, it was not substantively unconscionable. The court noted that the JAMS Rules incorporated into the agreement allowed the arbitrator to order additional discovery, including third-party discovery, if necessary. The court emphasized that the agreement should be interpreted to allow adequate discovery to vindicate statutory claims, as clarified in Ramirez v. Charter Communications, Inc.The appellate court reversed the trial court's order and remanded with instructions to grant TCU's motion to compel arbitration and stay the proceedings pending arbitration. The court concluded that the arbitration agreement was enforceable and not unconscionable. View "Vo v. Technology Credit Union" on Justia Law
Smith v. Cox Enterprises, Inc. Welfare Benefits Plan
Jeremy Smith, a customer care technician for Cox Enterprises, Inc., received long-term disability benefits for seven years due to severe back pain and multiple surgeries. In 2019, Aetna, the plan administrator, terminated his benefits, concluding he could work under certain conditions. Smith appealed, providing additional medical evidence, including a consultative examination from Dr. Harris, which supported his disability claim. Aetna upheld the termination, leading Smith to file a lawsuit under the Employee Retirement Income Security Act (ERISA).The United States District Court for the Eastern District of Virginia granted summary judgment in favor of Cox Enterprises, Inc. Welfare Benefits Plan. The court found that Aetna's decision was supported by substantial evidence and that it was reasonable for Aetna to discount the opinions of Smith's primary care physician and the Social Security Administration's disability determination.The United States Court of Appeals for the Fourth Circuit reviewed the case. The court held that Aetna abused its discretion by failing to adequately discuss and consider conflicting evidence, particularly Dr. Harris's consultative examination and the Social Security Administration's disability determination. The court found that Aetna did not engage in a deliberate and principled reasoning process, as required by ERISA regulations. Consequently, the Fourth Circuit reversed the district court's decision and remanded the case for further proceedings, instructing the district court to remand the matter to Aetna for reconsideration of Smith's claim. View "Smith v. Cox Enterprises, Inc. Welfare Benefits Plan" on Justia Law
Rosado v. Secretary, U.S. Department of the Navy
The case involves Jose Rosado, a Hispanic male of Colombian origin, who worked as an Information Technology (IT) Specialist for the United States Navy. Rosado alleged that he was denied promotions on five occasions between 2014 and 2018 due to race, national origin, and age discrimination, as well as retaliation for his prior Equal Employment Opportunity (EEO) activity. The promotions in question were for various IT Specialist positions within the Naval Facilities Engineering Command, Southeast (NAVFAC SE).In the lower court, the United States District Court for the Middle District of Florida granted summary judgment in favor of the Navy. The court concluded that Rosado failed to establish a prima facie case of discrimination or retaliation for any of the promotion decisions. Specifically, the court found that Rosado did not provide sufficient evidence to show that he was equally or more qualified than the individuals who were selected for the positions or that the Navy's decisions were influenced by discriminatory or retaliatory motives.The United States Court of Appeals for the Eleventh Circuit reviewed the case and affirmed the district court's decision. The appellate court held that Rosado did not establish a prima facie case of discrimination because he failed to show that the selected candidates were similarly situated in all material respects or that unlawful discrimination played any part in the Navy's decision-making process. Additionally, the court found that Rosado did not present sufficient evidence to support his retaliation claims, as there was no indication that retaliatory animus influenced the Navy's actions.In summary, the Eleventh Circuit affirmed the district court's grant of summary judgment for the Navy, concluding that Rosado did not provide enough evidence to support his claims of discrimination and retaliation. View "Rosado v. Secretary, U.S. Department of the Navy" on Justia Law
State of Texas v. Trump
Three states challenged an executive order issued by President Joseph R. Biden, which mandated that federal contractors pay their workers a minimum hourly wage of $15. The states argued that the President exceeded his authority under the Federal Property and Administrative Services Act (FPASA) and that the order violated the Administrative Procedure Act (APA) and the nondelegation doctrine. The district court for the Southern District of Texas agreed with the states, finding that the FPASA did not grant the President broad authority to set minimum wages for federal contractors and that the executive order was a major question beyond the President's authority. The court permanently enjoined the executive order.The United States Court of Appeals for the Fifth Circuit reviewed the case. The court examined whether the executive order was a permissible exercise of the President's authority under the FPASA. The court found that the FPASA's language was clear and unambiguous, granting the President broad authority to prescribe policies necessary to carry out the Act's provisions, as long as those policies were consistent with the Act. The court determined that the executive order met these requirements, as it aimed to promote economy and efficiency in federal procurement by ensuring contractors paid their workers adequately.The Fifth Circuit also addressed the application of the major questions doctrine, concluding that it did not apply in this case because the FPASA's text was clear and unambiguous. The court noted that the President's exercise of proprietary authority in managing federal contracts did not raise a major question requiring clear congressional authorization. Consequently, the court reversed the district court's permanent injunction and remanded the case for further proceedings consistent with its opinion. View "State of Texas v. Trump" on Justia Law
Grooms v. Privette
Betty Grooms, a Missouri clerk of court, filed a lawsuit under 42 U.S.C. § 1983 against Alice Bell and Judge Steven Privette, alleging violations of her First Amendment rights through discrimination and retaliation, and violations of her substantive due process rights. Grooms, a Republican, had defeated Bell, a Democrat, in an election for Circuit Clerk. Bell, who retained her job under Grooms, later married Privette, a Republican judge. Tensions arose when Bell and Privette were uncooperative with Grooms, leading to Bell's resignation and announcement to run for Circuit Clerk. Privette ordered Grooms to prepare detailed spreadsheets, which he repeatedly rejected, and initiated a contempt prosecution against her, which was eventually dismissed by the Missouri Supreme Court.The United States District Court for the Western District of Missouri dismissed Grooms's claims, ruling that the defendants did not violate her clearly established First Amendment rights and did not violate her substantive due process rights. The court found that the defendants' actions did not constitute adverse employment actions under clearly established law and that Grooms did not suffer a serious deprivation of a protected interest.The United States Court of Appeals for the Eighth Circuit reviewed the case and affirmed the district court's decision. The appellate court held that Bell and Privette were entitled to qualified immunity on the First Amendment claim, as Grooms failed to show that their actions constituted adverse employment actions under clearly established law. Additionally, the court found that Grooms's substantive due process claim was inadequate, as she did not demonstrate a serious deprivation of a protected interest. The court concluded that the defendants' conduct did not shock the conscience and did not violate Grooms's substantive due process rights. View "Grooms v. Privette" on Justia Law
Casey v. Superior Court
Kristin Casey, a former employee of D.R. Horton, Inc., filed a lawsuit against the company and one of its employees, Kris Hansen, alleging sexual harassment and other claims. D.R. Horton moved to compel arbitration based on an employment agreement that included an arbitration clause governed by California law. Casey opposed the motion, citing the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021 (EFAA), which allows plaintiffs to invalidate arbitration agreements in cases involving sexual harassment. The trial court granted the motion to compel arbitration, reasoning that the EFAA was inapplicable due to the choice-of-law provision in the employment agreement.The Contra Costa County Superior Court initially reviewed the case and granted the motion to compel arbitration, accepting Hansen's joinder. The court concluded that the choice-of-law provision in the employment agreement meant that California law, not the EFAA, applied. Casey then filed a petition for a writ of mandate to challenge this decision.The California Court of Appeal, First Appellate District, Division One, reviewed the case. The court held that the EFAA preempts state law attempts to compel arbitration in cases related to sexual harassment disputes. The court determined that the EFAA applies to the parties' transaction because it sufficiently involved interstate commerce. The court also concluded that the EFAA's rule of unenforceability of arbitration agreements in sexual harassment cases preempts the state law and that parties cannot contract around the EFAA through a choice-of-law provision. Consequently, the court granted Casey's petition and directed the trial court to vacate its order compelling arbitration and to enter a new order denying the motion. View "Casey v. Superior Court" on Justia Law
Williams v. Board of Trustees of The University of Alabama
Kristie Williams, a former employee of the University of Alabama at Birmingham, requested leave under the Family and Medical Leave Act (FMLA) to care for her daughter, who was allegedly sexually assaulted while serving in the Marine Corps. The University approved her leave, but Williams claimed she continued to receive work-related communications and criticism from her supervisors during her leave. This led to her resignation, and she subsequently sued the University, alleging interference with her FMLA rights and retaliation.The United States District Court for the Northern District of Alabama denied the University’s motion to dismiss, which argued that the suit was barred by state sovereign immunity. The court reasoned that Williams might have been seeking family-care leave under the FMLA, for which the Supreme Court had previously held that Congress validly abrogated state sovereign immunity.The United States Court of Appeals for the Eleventh Circuit reviewed the case and affirmed the district court’s decision. The court held that Williams’s suit could proceed regardless of whether she sought family-care leave, active-duty leave, or servicemember-family leave. For family-care leave, the Supreme Court’s decision in Hibbs confirmed that Congress had abrogated state sovereign immunity. For active-duty and servicemember-family leave, the court concluded that Alabama waived its sovereign immunity under the plan-of-the-Convention doctrine when it joined the Union, as these provisions were enacted pursuant to Congress’s constitutional authority to raise and support the military. Thus, the Eleventh Circuit affirmed the district court’s denial of the University’s motion to dismiss and remanded the case for further proceedings. View "Williams v. Board of Trustees of The University of Alabama" on Justia Law
International Brotherhood of Teamsters v. Republic Airways Inc.
Republic Airways Inc. and Hyannis Air Service, Inc. entered into individual employment agreements with pilot candidates, offering incentives in exchange for employment commitments. The International Brotherhood of Teamsters and its local unions argued that these agreements violated the Railway Labor Act (RLA) because they were not bargained for and fell outside the scope of the collective bargaining agreements (CBAs) between the parties.The United States District Court for the Southern District of Indiana dismissed the unions' complaint for lack of subject-matter jurisdiction, determining that the dispute was "minor" under the RLA and thus subject to arbitration. The court found that the resolution of the dispute required interpretation of the CBAs, which mandated arbitration.The United States Court of Appeals for the Seventh Circuit reviewed the case and affirmed the district court's decision. The appellate court held that the employment agreements were arguably justified by the broad discretionary language in the CBAs, which allowed the carriers to offer incentives and determine their terms. The court emphasized the RLA's strong preference for arbitration and concluded that the carriers' arguments were not frivolous or insubstantial. Therefore, the dispute was classified as minor and subject to arbitration, not federal court jurisdiction. The court also affirmed the dismissal of the unions' state law claim. View "International Brotherhood of Teamsters v. Republic Airways Inc." on Justia Law