Eighth Circuit Rejects Employees Retaliation Claim for Lack of Pretext

The Employment and Labor Law Alert
(The Employment Law Department)
October 1, 2002

In reliance on Jury Verdict Research, the New York Law Journal has reported that within the burgeoning arena of discrimination lawsuits, where the average jury award has reached $221,000.00, more than double the amount awarded only five years ago, retaliation claims are fast becoming a "growth industry" accordingly to a regional attorney for the Equal Employment Opportunity Commission.

While the trend towards larger verdicts based upon retaliation claims continues, courts continue to stringently apply the standards required to prove a retaliation claim. As was the case in Smith v. Allen Health Systems, Inc., _ F.3d _, 2002 WL 31015648 (8th Cir. Sept. 11, 2002), the United States Court of Appeals for the Eighth Circuit, held that plaintiff had not proved retaliation, as she failed to carry her burden of proving that her employers' proffered reason for her termination was pretextual, the timing of which was not determinative.

Candis Smith, an administrative secretary to The Memorial Foundation of Allen Hospital (the "Foundation"), the fund-raising arm of Allen Memorial Hospital, claimed that she was terminated by defendants in retaliation for taking leave to adopt a child under the Family and Medical Leave Act ("FMLA"), 29 U.S.C. § 2615. Smith further alleged that she was retaliated against pursuant to Title VII of the 1964 Civil Rights Act ("Title VII"), 42 U.S.C. § 2000e-3 for complaining about the Hospital's hiring processes to her employer. The court held that Foundation provided sufficient evidence to demonstrate that while Smith was terminated only two weeks after taking leave, her failure to perform essential job function was the sole reason for her termination. The Court further determined that there had been no evidence provided by Smith to prove a causal connection between Smith's termination and her complaint regarding the Hospitals hiring policy regarding Bosnians.

Background

In her role as administrative secretary, one of Smith's duties was to acknowledge each donation received by the Foundation with a card and receipt on a daily basis. On January 1, 1999, Smith took family leave to travel to Romania to adopt a child. While she was on leave, a co-worker found a stack of receipts in Smith's work area, dating back to November 4, 1998, for which tax notices and thank-you cards had not yet been sent by Smith. Smith had allegedly left the notices for another co-worker to respond to in her absence.

When Smith returned from Romania, she was called into work for a meeting on January 14, 1999, during which she was told that she was being terminated because of her failure to perform a major function of her job, namely sending out the receipts. Smith admitted that in mid-December 1998, the director of the Foundation had informed her that he had received complaints from donors who had not received their acknowledgments. Smith admitted to the director that she was behind in her duties and that she would get out the notices as soon as possible. Smith failed to mention to the director how severely over-due some of them actually were.

Smith alleged in her complaint that she was fired by the defendants in retaliation for having taken family leave and due to the fact that she had complained that defendants failed to hire Bosnians, which Smith characterized as religious discrimination. The District Court for the Northern District of Iowa granted summary judgment in favor of defendants finding that Smith failed to discredit defendants proffered reasons for discharging her.

The Standard for a Retaliation Claim

Using a variant of the McDonnell Douglas test, the Court held that to establish a prima facie case of retaliation under the FMLA, Smith had to show (1) that she exercised her rights afforded by the act, (2) that she suffered an adverse employment action, and (3) that there was a causal connection between her exercise of rights and the adverse action. See Darby v. Bratch, 287 F.3d 673, 679 (8th Cir. 2002). As it was undisputed that Smith took family leave and that she was fired, the Court was left only to decide whether Smith had established the causal link between her taking leave and her termination.

Temporal Proximity

The Court first addressed the fact that Smith's termination occurred only two weeks after she began her family leave. The Court found that while barely sufficient to establish causation, the fact that the two events occurred extremely close in time, was enough to satisfy the temporal proximity test, giving Smith a prima facie case.

Nondiscriminatory Termination vs. Pretext

The Court next held that the defendant had to demonstrate a legitimate, nondiscriminatory reason for terminating Smith in accordance with the McDonnell Douglas test. The Court accepted the Foundation's explanation for terminating Smith, that Smith's dereliction of her duties had put the Foundation in a precarious position with its donors and the fact that this was the sole reason for her termination. The Court held that although the timing of her termination coincided with her taking leave, the fact that she had been previously warned about her poor performance by her employer minimized the effect of the temporal proximity. The Court also found that since the Foundation did not know how late Smith was in sending out receipts and only became aware of this fact during her leave when she left the pile of receipts for a colleague to take care of, the impact of the timing of the termination was further diminished. This gave the Court another explanation for the proximity of the events other than retaliation. Accordingly, the Court found that the sole fact that she was fired at about the same time she took leave could not support the necessary element of pretext.

The Court also rejected Smith's further attempts to prove pretext. Smith alleged that she received a positive performance review at the end of December 1998, which the Court acknowledged would, under normal circumstances, be evidence that the employer's proffered reasons for the termination had no basis in fact or was no in fact important to the employer. See Erickson v. Farmland Indus., Inc., 271 F.3d 718, 728 (8th Cir. 2001). Yet, the Court held that a review issued without the knowledge that Smith was two months behind in her duties, was irrelevant as to whether Smith was terminated because she failed to send out the receipts in a timely manner. Smith's additional contention that her replacement was held to a different standard then she was, was also dismissed by the Court. The Court found that Smith's replacement had never been as far behind in her obligations as Smith had been, therefore finding there was no issue of pretext. Lastly, Smith's contention that the Foundation altered its explanation for terminating her was rejected by the Court. The Court held there was no evidence of pretext, as the employer had merely pointed out an additional aspect of the same behavior that had been given as the reason for Smith's termination.

Title VII Claim

The Court found that Smith's retaliatory discharge claim based on religious discrimination lacked the causal connection between her exercise of religious rights and the termination of her employment necessary to prove her Title VII claim. Smith merely relied on the temporal proximity and failed to give any evidence of pretext.

Conclusion

While not all plaintiffs are successful in their pursuit of recovery under retaliation, employers must be aware that the threat of such claims is ever mounting and the awards being given by juries continues to grow dramatically. Accordingly, Employers should seek the advise of legal counsel. if they have any questions or concerns involving the risks and ramification of taking adverse employment actions against employees and the potential exposure to claims of retaliation.