Supreme Court Rules That ADA Permits Employers to Deny Job to Disabled

On June 10, 2002, the United States Supreme Court, in an unanimous decision, ruled that the Americans with Disabilities Act (the "ADA" or the "Act") allows an employer to screen out potential employees with disabilities who pose a risk on the job to their own health or safety. In Chevron U.S.A., Inc. v. Echazabal,1 the plaintiff, Mario Echazabal, began working in 1972 for independent contractors at an oil refinery owned by Chevron. In the early 1990's Echazabal twice applied for a position directly with Chevron, and, each time, Chevron made a job offer to Echazabal, contingent on his ability to pass a physical. Chevron subsequently withdrew each of the job offers after Echazabal's physicals revealed a liver abnormality, later identified to have resulted from Echazabal's contraction of Hepatitis C. Chevron withdrew its job offers based on statements made by company physicians that Echazabal's condition would be aggravated by exposure to toxins at the Chevron refinery.

Following the withdrawal of its second job offer to Echazabal, Chevron asked the contractor that employed him to reassign Echazabal to a position without exposure to toxins, or to remove him from the refinery entirely. The contractor laid Echazabal off in 1996.

Echazabal sued Chevron under the ADA, claiming that the company refused to hire him and refused to allow him to continue working for the contractors because of his disability in violation of the Act. For its defense, Chevron asserted that the EEOC regulations interpreting the ADA permitted an employer to deny employment to a qualified individual with a disability who would pose a "direct threat" to his own health if he were hired.2

Echazabal argued that the EEOC "threat to self" regulation relied upon by Chevron impermissibly exceeded the scope of the ADA. Specifically, Echazabal contended that the Act creates an affirmative defense where an applicant is denied a position because he cannot meet a qualification standard that is "job-related" and "consistent with business necessity."3 Under the ADA, such a qualification standard may include "a requirement that an individual shall not pose a direct threat to the health or safety of other individuals in the workplace," if the applicant or employee cannot perform the job safely with reasonable accommodation.4 Echazabal argued that the EEOC, through its regulations, impermissibly expanded the qualification standard to include "a requirement that an individual shall not pose a direct threat to the health or safety of the individual or others in the workplace."5

Essentially, Echazabal asserted that because he did not pose a threat to others, but only to himself, the employer should not be entitled to the defense, and should not be permitted to exclude him from the workplace because of his disability. The Supreme Court disagreed.

The Court held that, because the ADA states that qualification standards falling within the limits of job relation and business necessity "may include" the denial of positions to persons who would pose a direct threat to "others," the statutory language is broad enough to permit the denial of employment to individuals who pose a threat to themselves only.6

The Court concluded that Echazabal's narrow reading of the statute would unnecessarily limit the number of persons whose safety could be considered to only "others" who were "in the workplace." This was not, the Court reasoned, what Congress intended. The Court theorized, "When Congress specified threats to others in the workplace, for example, could it possibly have meant that an employer could not defend a refusal to hire when a worker's disability would threaten others outside the workplace? If Typhoid Mary had come under the ADA, would a meat packer have been defenseless if Mary had sued after being turned away?"7

The full implications of the Chevron decision will not likely be known for some time. What is clear is that the Supreme Court has expanded an employer defense to claims under the ADA and has given employers the green light to refuse to hire or to terminate an employee who poses a direct threat to either himself or herself, or to others both inside and outside the workplace.

High Court Decides That Continuing Violation Doctrine Applies to Hostile Environment Claims

On June 10, 2002, the United States Supreme Court issued an opinion that will have a significant impact on the way lower courts assess employee claims of hostile work environment discrimination. In National Railroad Passenger Corp. v. Morgan,8 the Court was faced with the issue of whether, and under what circumstances, an employment discrimination plaintiff may file suit relating to events that fall outside the 180- or 300-day limitations period prescribed by Title VII.9

In a partial victory for employers, the Court, in the first part of its opinion, unanimously held that Title VII "precludes recovery for discrete acts of discrimination or retaliation that occur outside the statutory time period."10 In a significant setback for employers, however, a much narrower majority of the Court also held that in the case of hostile environment claims, "consideration of the entire scope of a hostile work environment claim, including behavior alleged outside the statutory time period, is permissible for the purposes of assessing liability, so long as any act contributing to that hostile environment takes place within the statutory time period."11

The plaintiff in the case, Abner Morgan, Jr., a black male, asserted that during the course of his employment at Amtrak he was "consistently harassed and disciplined more harshly than other employees on account of his race."12 Morgan filed a charge of discrimination with the EEOC, alleging acts of discrimination that occurred both within 300 days of the filing of the charge and many acts of discrimination that allegedly occurred outside the statutory period. Amtrak argued that it was entitled to summary judgment on any alleged incidents that occurred more than 300 days before the date on which Morgan filed his Charge.

The District Court agreed with Amtrak, and granted judgment in its favor on all of Morgan's allegations of discrimination occurring more than 300 days before the filing of his Charge. In so doing, the District Court relied upon the Seventh Circuit's decision in Galloway v. General Motors Service Parts Operation,13 that a "plaintiff may not base [the] suit on conduct that occurred outside the statute of limitations unless it would have been unreasonable to expect the plaintiff to sue before the statute ran on that conduct, as in a case in which the conduct could constitute, or be recognized, as actionable harassment only in the light of events that occurred later, within the period of the statute of limitations."14 The District Court held that "[b]ecause Morgan believed that he was being discriminated against at the time that all of these acts occurred, it would not be unreasonable to expect that Morgan should have filed an EEOC charge on these acts before the limitations period on these claims ran."15 On appeal, the United States Court of Appeals for the Ninth Circuit reversed the District Court's decision, holding that the continuing violation doctrine "allows courts to consider conduct that would ordinarily be time barred as long as the untimely incidents represent an ongoing lawful employment practice."16

The Supreme Court issued a two-part opinion on this issue. In part one, the Court unanimously held that "discrete acts such as termination, failure to promote, denial of transfer, or refusal to hire are easy to identify. Each incident of discrimination and each retaliatory adverse employment decision constitutes a separate actionable 'unlawful employment practice.'"17 Thus, the Court held that "discrete discriminatory acts are not actionable if time-barred, even when they are related to acts alleged in timely filed charges."18 As a result, Morgan could file a charge and pursue claims relating to acts that allegedly occurred within the statutory time period, but "[a]ll prior discrete discriminatory acts are untimely filed and no longer actionable."19

In the second part of its opinion, the Court held that "[h]ostile environment claims are different in kind from discrete acts," because "[t]heir very nature involves repeated conduct."20 In a much narrower 5-4 decision, the Court held that for purposes of Title VII hostile work environment claims, it does not matter that some of the component acts of the alleged hostile environment fall outside the statutory time period. "Provided that an act contributing to the claim occurs within the filing period, the entire time period of the hostile environment may be considered by a court for the purposes of determining liability."21 Consequently, an employer may be liable for all acts that comprise an employee's hostile environment claim, even those that date back several years, so long as the acts complained about "are part of the same actionable hostile work environment practice," and the employee alleges that at least one act comprising the hostile environment claim occurred within the limitations period.22

In a short "peace offering" to employers, the Court, at the end of the majority opinion, stated that its "holding does not leave employers defenseless against employees who bring hostile work environment claims that extend over long periods of time."23 The Court stated that employers have a defense when a plaintiff unreasonably delays filing a charge of discrimination, in that employers can assert equitable doctrines such as waiver, estoppel, equitable tolling, and laches. These equitable defenses typically require an employer to demonstrate lack of diligence by the plaintiff and resulting prejudice to the defense, and would operate to exclude from consideration those claims that are so "old" that the employer cannot defend them because, for example, witnesses are no longer available, or documents have been lost or destroyed.24

In sum, while the first part of the Court's decision in Morgan limits an employer's potential liability where a plaintiff alleges discrimination in the form of discrete acts, the second part of the decision represents a significant expansion of an employer's potential liability where the claim is one for hostile work environment. Employers may now be liable for harassing conduct in the workplace dating back years before the employee first files a discrimination charge with the appropriate agency. As a result, it is more critical than ever that employers take steps both to prevent harassment from occurring (such as by conducting harassment training) and to put a stop immediately to any harassing conduct of which it learns (such as by enforcing a strong no-harassment policy).

Endnotes:
1 536 U.S. ---, No. 00-1406 (June 10, 2002).
2 See 29 CFR § 1630.15(b)(2). Pursuant to the regulations, the direct threat defense must be based on "reasonable medical judgment that relies on the most current medical knowledge and/or the best available objective evidence," and on an expressly "individualized assessment of the individual's present ability to safely perform the essential functions of the job." Id. § 1630.2(r).
3 42 U.S.C. § 12113(a).
4 Id. (emphasis added).
5 29 CFR § 1630.15(b)(2) (emphasis added).
6 536 U.S. ---, No. 00-1406, slip op. at 6.
7 Id., slip op. at 9. The Court further noted that the EEOC regulation constituted a permissible resolution of the potential conflict between a worker's ADA rights and the Occupational Safety and Health Act's policy of ensuring the safety of every worker. Id., slip. op. at 10-11.
8 536 U.S. ---, No. 00-1614 (June 10, 2002).
9 The limitations period differs depending on whether the state in which the alleged unlawful practices occurred has a "work-sharing" agreement with the EEOC.
10 536 U.S. ---, No. 00-1614, slip op. at 2.
11 Id.
12 Id.
13 78 F.3d 1164 (7th Cir. 1996).
14 Id. at 1167.
15 536 U.S. ---, No. 00-1614, slip op. at 3.
16 232 F.3d 1008, 1014 (9th Cir. 2000) (quotation omitted).
17 536 U.S. ---, No. 00-1614, slip op. at 11.
18 Id. at 10. The Court did note, however, that untimely prior acts could be used by the plaintiff as evidence in support of a timely claim. Id.
19 Id. at 10-11.
20 Id. at 12.
21 Id. at 14.
22 Id. at 18. Thus, employers may still limit their liability by showing that earlier complained-of acts do not involve the same type of actions or the same alleged harassers as the acts that allegedly occurred within the statutory time period. See Id.
23 Id.
24 Id. at 18-19.

This Legal Update is published by Ross & Hardies to provide a summary of significant developments to our clients and friends. It is intended to be informational and does not constitute legal advice regarding any specific situation.