The California Department of Fair Employment and Housing (DFEH) today announced a $210,000 out-of-court settlement of a disability discrimination in employment case filed against The Permanente Medical Group (TPMG) for refusal to accommodate and unlawful termination.

According to the Department, a registered nurse in one of TPMG’s Northern California facilities had suffered work-related repetitive stress injuries to her hands and shoulder, which TPMG had initially accommodated.  After the employee underwent shoulder surgery, she returned to work and requested additional doctor-recommended accommodation.  However, TPMG allegedly refused to return the employee to work and instead placed her on a permanent leave of absence.

“The purpose of the Fair Employment and Housing Act is to keep people with disabilities engaged and productive in the workplace,” said DFEH Director Phyllis Cheng.  “Employees should be accommodated so long as they are able to perform the essential functions of the job.  Employers are excused from making the accommodation only if it causes an undue burden.”

The settlement also required TPMG to reinstate the employee in addition to paying her $210,000 for lost wages and emotional pain and suffering.  TPMG further agreed that its Northern California medical group facilities’ managers, supervisors, and disability case managers would receive disability discrimination prevention training.  In settling the case, TPMG did not admit liability.

The mission of the DFEH is to protect the people of California from unlawful discrimination in employment, housing and public accommodations and from hate violence.  For more information, visit the Department’s website at www.dfeh.ca.gov.

The U.S. Court of Appeals for the Seventh Circuit recently held that a nursing home maintained a racially hostile working environment by accommodating its residents’ requests to be treated by white-only personnel and by terminating the plaintiff, a black nursing assistant, for an alleged workplace infraction. Chaney v. Plainfield Health Center

Brenda Chaney worked for Plainfield Health Center (Plainfield) as a certified nursing assistant. Among Plainfield’s residents was an individual who did not want assistance from black CNAs. Plainfield detailed employees’ duties on an assignment sheet that Chaney and other employees received each day when they arrived at work. The sheet included a column with miscellaneous notes about each resident’s condition. In the case of one resident, the sheet instructed staff members that the resident “Prefers No Black CNAs.” Chaney also presented evidence of racially tinged comments and epithets from co-workers. While these ceased after Cheney complained, a co-worker continued to remind Chaney that certain residents were off limits because she was black. Just three months after she was hired, Plainfield terminated Chaney’s employment.

Chaney filed a charge with the EEOC, and subsequently filed suit in U.S. District Court in Indianapolis. The district court concluded that the note on the plaintiff’s daily assignment sheet advising her of the “Prefers No Black CNAs” was reasonable given the facility’s good-faith belief that ignoring a resident’s preferences would violate Indiana’s patient-rights laws, and found that Chaney failed to refute Plainfield’s stated reasons for terminating her employment. Chaney appealed.

The Seventh Circuit reversed the district court’s decision. It rejected Plainfield’s argument that its policy of honoring its residents’ racial preferences was akin to honoring a patient’s preference for same-sex health providers, which courts have found permissible. The Court also rejected Plainfield’s argument that because it is both a medical provider and permanent home for residents, the rights of residents must be honored before considering its Title VII obligations to employees, holding that Title VII does not allow an employer to discriminate based upon race in order to accommodate the racial biases of its customers. Further, the Court rejected Plainfield’s claim that its policy protected black employees from residents’ racial harassment, stating that the facility had several other options available to it to address its patient’s racial preferences, such as warning residents before admitting them of the facility’s nondiscrimination policy or assigning staff based on race-neutral criteria that minimized the risk of conflict. Finally, the Court found that Chaney had presented sufficient evidence that Plainfield’s grounds for firing her were insincere, and that her termination was racially motivated.

The issue confronted in this case remains a common one, particularly for employers in the health care sector, where employees must have direct and often very intimate contact with members of the public. While it can be difficult to balance the rights and preferences of patients and residents with those of employees, this case makes it clear that when a patient’s racial preference conflicts with Title VII, the employer’s obligation to provide a discrimination-free workplace under Title VII takes precedence.

Article courtesy of Worklaw Network firm Franczek Radelet (www.franczek.com).

Merchandising Concept Group v. California Unemployment Ins. Appeals Bd. (2010) , Cal.App.4th

Merchandising Concept Group contracted with clothing manufacturers to provide attractive product displays to promote sales of goods in retail stores. The people who made the displays were called detailers, and Merchandising Concept Group classified them as independent contractors.

The Employment Development Department audited Merchandising Concept Group and determined the detailers were not independent contractors but employees subject to employment tax-related deductions. The Employment Development Department issued an assessment totaling approximately $110,000 plus a penalty on Merchandising Concept Group based on the reclassification of 148 of its workers. This assessment included unpaid unemployment insurance contributions, employment training taxes, disability insurance contributions, and personal income tax.

Lesson: Get your 1099 act together! HR That Works Members are encouraged to watch the Independent Contractor Webinar and review the Independent Contractor Training Module which includes a video, report, analysis checklist, sample agreement and more.