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In the disparate impact discrimination context, Title VII of the Civil Rights Act of 1964 allows employers to treat employees differently based on their work location. At least in some jurisdictions, this “safe harbor” exception to Title VII applies to termination decisions, the 1st U.S. Circuit Court of Appeals ruled.
In 2006, employees of the Federal Emergency Management Agency (FEMA) National Processing Service Center (which is a call center) complained to management that FEMA was paying employees in Puerto Rico less than similarly situated call center employees working in the continental U.S. When FEMA failed to resolve their claims, the employees complained to the equal employment opportunity (EEO) office.
While the EEO charges were pending, FEMA evaluated the Puerto Rico facility and identified a number of safety concerns there, including the absence of exit signs, the lack of safety training during orientation, the lack of an egress route around the building, an insufficient number of exits and malfunctioning fire alarms. In mid-May 2008, FEMA placed the call center employees in Puerto Rico on paid administrative leave for two months. When the facility reopened in July 2008, it did so with a substantially reduced staff (only 15 to 20 of its approximately 300 former employees) working a rotating schedule. Thereafter, FEMA decided to close the call center in Puerto Rico rather than extend the lease beyond February 2009.
Francisco Abril-Rivera and a group of FEMA employees filed suit and alleged claims of national origin discrimination and retaliation based on FEMA’s decision to implement the rotational staffing plan and close the call center after the employees complained about the pay practices at the Puerto Rico facility. The court rejected these claims on the grounds that 1) “different treatment in different locations is permissible absent an intent to discriminate” and 2) “defendants have presented legitimate business justifications for their actions” and they must be “able to make the practical business choices and profit-related decisions that sustain a dynamic free-enterprise system.”
The employees further alleged that FEMA decided to close the Puerto Rico facility to retaliate against the employees for complaining about their alleged underpayment and the implementation of the rotating work schedule. In affirming the district court’s decision granting summary judgment on the employer’s behalf, the appellate court applied the required “but-for” causation standard and concluded that the 2006 series of complaints was “far too temporally remote” from the 2008 implementation of the rotating schedule and the 2009 facility closure to support even “inference of causality,” and certainly too remote to demonstrate that “protected activity was a ‘but for’ cause” of the challenged actions. In support of this conclusion, the court cited several cases that concluded that a gap of 20 months “suggests … no causality at all,” and that a period of “more than eight months” between the allegedly protected activity and the challenged action is “insufficient to establish temporal proximity.”
In addition, the court focused on the employer’s safety concerns, the costs likely to be incurred in addressing those concerns and the very high (approximately $9 million) cost of establishing an alternate facility in Puerto Rico. Abril-Rivera v. Johnson, 1st Cir., No. 14-1316 (July 30, 2015).
Professional Pointer: Employers should document the business justifications for their actions so they can rebut an employee’s attempt to establish retaliation or show that an available alternative would have served the employer’s legitimate interests while imposing less of an impact on a protected population. Specific information about the risks and costs associated with potential alternatives can be compelling to a court, especially when employee safety or high financial costs are involved. Finally, when location serves as a proxy for cost or other business considerations, employers should retain contemporaneous evidence of the location-based disparities.
Danielle Vanderzanden is a shareholder in the Boston office of Ogletree Deakins, a labor and employment law firm representing management.
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