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Employers will likely face more jury trials, increased pressure for settlement and greater caution in making employment-related decisions because of an age bias ruling by the U.S. Supreme Court. Although the June 12 ruling in Reeves v. Sanderson Plumbing Products Inc., No. 99-536, arose from an age discrimination suit, its impact cuts across the landscape of job bias litigation. And the news for bosses generally is not good. “The effect on employers could be felt in two ways: It could become harder to get summary judgment than it has been, and it also will be harder to overturn verdicts,” says Paul Salvatore, chair of the employment law department at New York’s Proskauer Rose. “The court made clear, in this context and generally, that they’re serious about the role of the jury in determining facts and the proper role of a court in motions for judgment as a matter of law.” A unanimous high court held in Reeves that a judge or jury may find an employer liable for intentional discrimination if an employee-plaintiff makes a “prima facie case” of discrimination and proves, by a preponderance of the evidence, that the employer’s reason for a firing or other job action was a pretext — not the real reason. The justices’ ruling rejected an interpretation of an earlier high court precedent that had become prevalent in five federal circuits. The U.S. courts of appeals for the 4th and 5th circuits, in particular, had reversed a significant number of jury verdicts for employees after finding that the employees had failed to produce “pretext-plus” evidence. Under pretext-plus, employees not only had to show that the employer’s reasons were false, but also had to produce additional evidence of intentional discrimination. That is exactly what happened to Roger Reeves, a production line supervisor at Sanderson, a Columbus, Miss., company that manufactures toilet seats, when he won his suit against the company for firing him in 1995, after 40 years of service. The 5th Circuit, in entering judgment as a matter of law for Sanderson, said Reeves’ prima facie case and that proof the company’s reason for firing him — failure to maintain accurate attendance records — was pretextual weren’t enough, by themselves, to sustain the jury’s finding. Writing for the Supreme Court, Justice Sandra Day O’Connor said that the 5th Circuit “misconceived” the evidentiary burden on plaintiffs trying to prove intentional discrimination with indirect evidence. Looking to the court’s 1993 ruling in St. Mary’s Honor Center v. Hicks, 509 U.S. 502, O’Connor wrote, “We reasoned that it is permissible for the trier of fact to infer the ultimate fact of discrimination from the falsity of the employer’s explanation.” But, she cautioned, there may be cases in which the combination of a prima facie case and proof sufficient to reject the employer’s reason will not be adequate to sustain a jury’s verdict. Writing in concurrence, Justice Ruth Bader Ginsburg suggested that such cases, in which the plaintiff would have to produce additional evidence, “will be uncommon.” STRONG REBUKEHicks — the last big decision to spell out standards for employment discrimination cases — was ambiguous about how much evidence was needed,” says labor-side litigator Paul Mollica, of Chicago’s Meites, Mulder, Burger & Mollica, amicus counsel in the case to the National Employment Lawyers Association. “But it did explicate quite clearly this was an issue for the fact-finder and was not supposed to be a judge decision.” Reeves is a “strong rebuke,” he adds, to those courts that “got lost” on the way. “It also bolsters the judgment that plaintiffs’ attorneys have instinctively [believed] that these cases are for juries and there shouldn’t be appellate nullification,” he said. Mollica says that the decision should discourage companies from filing “groundless” summary judgment motions: “That is really the scourge of the employment field — lengthy, exhibit-heavy summary judgment motions that have to be responded to just to decide whether you get to the jury. They’re time-consuming and distracting, and not very productive.” The decision also, he says, should dissuade some employers from taking appeals when they lose. “Time will tell” whether it will be easier for plaintiffs to get to trial, says Proskauer’s Salvatore. “A lot will turn, as it should, on the individual facts of the cases. In the meantime, in advising employers, I would recommend they continue to do what they’ve been doing for quite some time — to focus on prevention and alternative ways of resolving these claims short of litigation.” Besides having anti-discrimination policies in place that are well-communicated “from top down,” he adds, companies need to increase training budgets and create viable, internal appeals processes — “more than open doors” — in which corporate ombudsmen or others not involved in the problem situation work to resolve the claim. He also recommends mediation and arbitration. Employers also should scrutinize their reasons for taking employment actions — before they actually carry them out, adds Ann Elizabeth Reesman, of Washington, D.C.’s McGuiness, Norris & Williams, amicus counsel in the case to the Equal Employment Advisory Council, a national association of employers, and Peter Petesch, of Washington, D.C.’s Ford & Harrison, amicus counsel to the Society for Human Resource Management. “Ask yourself: is it true, is it credible, and is it consistent with other actions taken in the past based on similar reasons?” says Reesman. Document decisions and performance problems, adds Petesch, and do “a little homework before pulling the trigger.” FUTURE PROBLEMS In the wake of Reeves, Jay W. Waks, co-chair of the employment law department at New York’s Kaye, Scholer, Fierman, Hays & Handler, predicts, employers — particularly large ones — will face an important question: the extent to which statistical evidence, such as the incidence of promotions or terminations, will be enough to send a case to a jury on the issue of whether the employer’s reason for a job action is pretextual. Reeves, he predicts, will give greater strength to statistics-based arguments of pretext. And while Reeves filled holes left by the 1993 Hicks decision, says Waks, it left others open. For example, he explains, courts will continue to struggle with the weight that should be given to so-called stray comments. Reeves’ manager, for example, said that Reeves was “too damn old” to do his job and, another time, told Reeves he was so old that he “must have come over on the Mayflower.” “In some cases, a court will decide those statements are just too remote to really have a bearing,” Waks explains. “In others though, the Reeves case will make it easier to get to the jury because you don’t have that remoteness or isolation factor. What is going to be the demarcation line?” If Reeves takes hold, Salvatore adds, “We’re going to have less and less opportunity to have cases dismissed before getting to the jury. Let’s solve it well before it even gets there.”

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