The Senate Judiciary Committee Oct. 7 heard varied views on whether Congress should overturn recent U.S. Supreme Court opinions that make it tougher for plaintiffs to prove Age Discrimination in Employment Act claims and allow employers to force workers to submit statutory discrimination claims to binding arbitration.

Sen. Patrick Leahy (D-Vt.), the committee chairman, said an “activist, conservative” majority of the Supreme Court has “misinterpreted” the ADEA, Title VII of the 1964 Civil Rights Act, and the Federal Arbitration Act to deprive employees of protections that Congress intended.

Just as Congress overturned the Supreme Court's decision in Ledbetter v. Goodyear Tire & Rubber Co. ( 550 U.S. 618, 100 FEP Cases 1025 (2007)) through legislation signed by President Obama (27 HRR 93, 2/2/09), Leahy said Congress should restore the rights of age discrimination plaintiffs by overturning Gross v. FNL Financial Services Inc. ( 129 S.Ct. 2343, 106 FEP Cases 833 (2009); 27 HRR 651, 6/22/09).

On Oct. 6, Sen. Tom Harkin (D-Iowa) and Rep. George Miller (D-Calif.) introduced the proposed Protecting Older Workers Against Discrimination Act (S. 1756, H.R. 3721), which would clarify that an ADEA plaintiff prevails if he can prove age was “a motivating factor” for an adverse employment practice, “even if other factors also motivated” that practice.

At the Oct. 7 hearing, Jack Gross, the 61-year-old plaintiff in the Supreme Court case, testified, “I feel like my case has been hijacked by the high court for the sole purpose of rewriting both the letter and the spirit of the law.” He added, “I urge corrective legislation be taken as soon as possible.”

Michael Foreman, a law professor at Pennsylvania State University's Dickinson School of Law, said the Gross majority decided an issue that was neither briefed nor argued by the parties. Foreman said it was “very clear” that Congress never intended age bias claims under the ADEA “to be treated any differently” from Title VII claims.

Foreman said the notion that a plaintiff must prove discrimination is the “but for” cause of adverse employment action was a standard Congress rejected when it originally passed Title VII and rejected again when it passed the Civil Rights Act of 1991, which codified the “mixed motive” theory in Price Waterhouse v. Hopkins ( 490 U.S. 228, 49 FEP Cases 954 (1989)).

The Supreme Court in Gross made clear that Congress must be “very specific” regarding discrimination claimants' protections and Congress should meet that challenge by overturning Gross, Foreman urged.

Gross Adopts 'Common-Sense' Rule.

Passing legislation to overturn Gross would be “a tragic mistake,” testified Michael W. Fox, a management lawyer with Ogletree, Deakins, Nash, Smoak & Stewart in Austin, Texas. He said “almost all the criticism” of the Supreme Court's decision misses “the significance of the differences” between the ADEA and Title VII as well as “the spotty history” of the “mixed motive” analysis.

Fox pointed out that under Price Waterhouse, use of the mixed motive theory was designed for bench trials but its use was expanded to jury trials under the 1991 Civil Rights Act. Congress did not include the ADEA in that section of the 1991 act, Fox emphasized. In deciding Gross, the Supreme Court had the advantage of seeing how mixed motive instructions have “worked in the real world of jury trials,” Fox said.

He said the Gross majority adopted a “common-sense rule” of not extending the mixed-motive theory beyond Title VII cases because of the difficulty such an instruction presents in jury trials. Fox explained that courts have experienced “significant difficulties” in instructing on mixed motive and that “it's not really needed” by juries weighing discrimination claims. “It's too confusing to the jury,” Fox said.

Rather than overturning Gross, Congress would be “better served” by “closer examination of how successful and necessary” the mixed motive approach has been, Fox said. He advised that Congress determine “how mixed motive has actually worked in the real world of jury trials” before extending its use to ADEA claims.

Mandatory Arbitration Challenged.

The committee also heard from Jamie Leigh Jones of Spring, Texas, a former employee of a Halliburton Co. subsidiary who was raped by male co-workers in Iraq. Based on an employment contract that Jones signed, Halliburton sought to compel arbitration of Jones's civil assault and battery claims as well as her Title VII discrimination claim. In a 2-1 decision, the U.S. Court of Appeals for the Fifth Circuit ruled that arbitration was not required on Jones's civil tort claims, rejecting Halliburton's argument that since the sexual assault took place on work premises it was “employment-related” for purposes of mandatory arbitration (27 HRR 1000, 9/21/09).

Jones said “the system of pre-dispute, mandatory, confidential, binding arbitration keeps this evidence from ever coming to public light and allows companies like Halliburton to continue to allow the abuse of their employees without repercussion or public scrutiny.”

Leahy said the Supreme Court's decision in Circuit City Stores v. Adams ( 532 U.S. 105, 85 FEP Cases (2001)), which upheld mandatory arbitration of individual discrimination claims under Title VII, misinterpreted the Federal Arbitration Act (FAA), which was intended to give businesses “an alternative venue to resolve” commercial disputes.

“Congress never intended [the FAA] to become a hammer for corporations to use against their employees,” Leahy said. “But in Circuit City, the Supreme Court allowed for just that. Now after the Circuit City decision, employers are unilaterally able to strip employees of their civil rights by including arbitration clauses in every employment contract they draft.”

Citing estimates that “at least 30 million workers have unknowingly 'waived' their constitutionally guaranteed right to have their civil rights claims resolved by a jury,” Leahy said legislation may be needed to overturn Circuit City.

Sen. Russell Feingold (D-Wis.) has introduced the proposed Arbitration Fairness Act (S. 931), which would bar mandatory arbitration of employment-related claims unless required by a collective bargaining agreement (27 HRR 487, 5/11/09). A companion bill in the House (H.R. 2010) has garnered 91 co-sponsors.

Management Lawyer Defends Arbitration.

Testifying in “strong support” of using alternative dispute resolution for employment discrimination claims, Mark A. de Bernardo, a partner with Jackson Lewis in Washington, D.C., said ADR that includes binding arbitration “is both pro-employer and pro-employee” when “implemented properly.”

Passage of S. 931 would “effectively end arbitration” in private employment, de Bernardo warned. Labor unions have “long embraced” arbitration as the primary means to resolve employment disputes “and we agree,” de Bernardo said, referring to employers that use ADR.

Employment claims, including allegations of discrimination, are “resolved sooner with less tension” and with lower employee turnover in arbitration than if they are litigated in court, de Bernardo told lawmakers. “The old adage that justice delayed is justice denied is certainly true in this context,” he said, explaining that the time and expense of litigation eclipse any recovery the average plaintiff can expect.

The Senate Oct. 6 passed legislation (H.R. 3326) barring the Defense Department from using funds for an existing or new federal contract if a defense contractor or “subcontractor at any tier” requires a worker to sign a contract mandating arbitration of certain civil rights or injury claims (see related article on p. 1079).

Copyright 2009, The Bureau of National Affairs, Inc.