WASHINGTON -- The Supreme Court, in the term that began Monday, will rule on at least two disputes that could have a major impact on how employees fight alleged mistreatment by their employers.
In the two cases, to be heard later this fall, the justices will consider who constitutes a "supervisor" for whose harassing actions an employer can be hold responsible and whether employers can cut off possible class actions by offering full settlements to the initial plaintiff.
Vance v. Ball State University asks precisely who counts as a "supervisor" in a workplace setting. Prior Supreme Court cases have held that an employer can be held liable for harassment or related retaliation by one of its supervisors under the Fair Labor Standards Act. The question is how much authority an employee needs to be considered a "supervisor" -- enough to hire, fire, promote, demote or discipline the victim or just enough to manage the victim's daily work.
Lower courts have split on the issue. Some have decided that people don't have the legal right to sue their employers because they suffered harassment at the hands of a person who lacked the power to fire or demote them.
Other courts have seen it differently, ruling that people who are vested with what the Equal Employment Opportunity Commission calls the authority to "direct and oversee their victim's daily work" count as supervisors. Thus, their employers can be held liable for their bad acts under Title VII of the 1964 Civil Rights Act.
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In the case before the Supreme Court, Maetta Vance alleges that Saundra Davis, her co-worker in Ball State's catering department, threatened, slapped and directed racial insults at her. According to Vance's Supreme Court brief, Davis, who outranked her, had "authority to direct Vance's and other employees' work."
At the time, Vance was the only African-American employee on the Muncie, Ind., university's catering staff. She alleges that Davis and another employee, Connie McVicker, "created an environment of physical intimidation and racial harassment." After Davis allegedly slapped her, Vance claims Davis cornered her in an elevator and threatened her, saying, "I'll do it again." Davis also allegedly used terms like "Buckwheat" and "Sambo." Vance claims that McVicker "regularly" used a highly offensive racial slur to refer to Vance and to the black students at Ball State. Vance also alleges that McVicker "openly boasted of her family's connections to the Ku Klux Klan."
In fact, Indiana has a long history of Ku Klux Klan activity. As recently as 2010, the FBI investigated a case there in which a six-foot-tall cross was burned on the lawn of a white couple who had adopted a black child.
The Supreme Court oral arguments in Vance v. Ball State are scheduled for Nov. 26.
The second employment case deals with "collective" lawsuits under the Fair Labor Standards Act. At issue is whether an employer's offer to satisfy all of the initial individual plaintiff's claims effectively ends the suit, thereby preventing the plaintiff from seeking to turn her single case into a collective case such as a class action.
In Genesis Healthcare Corp. v. Symczyk, Philadelphia nurse Laura Symczyk alleges that the company violated overtime laws for years by deducting from her pay a full 30 minutes for lunch even when she didn't take 30 minutes to eat and get back to work. Before Symczyk could formally ask the court to certify her case as a collective action, the company offered her a full settlement of her individual claims -- $7,500 plus costs. Instead of settling, she began the proceedings to create a collective action.
At the Supreme Court, Genesis Healthcare argues that its offer of a full settlement for Symczyk resolves the case. Business groups like the U.S. Chamber of Commerce agree. The Chamber's litigation arm asserts in its amicus brief that companies settle cases like this precisely to avoid them turning into class action suits, which can produce onerous jury awards of millions of dollars on behalf of thousands of employees.
Symczyk's lawyers, however, argued successfully in lower courts that unless workers can keep the door open to potential collective status, employers could essentially "pick off" potential plaintiffs by offering them settlements one by one before the judge could certify any collective case.
This case also has enormous potential ramifications for lawyers who specialize in class action lawsuits. The huge awards can mean huge attorney fees, so the lawyers have a vested interest in letting them go forward even if settlements have been offered.
Oral argument in Genesis Healthcare v. Symczyk is set for Dec. 3.
The Supreme Court will most likely decide both cases by the end of its term in June 2013. In the meantime, it may add other workplace issues to the docket.