Friday, December 5, 2014

Joint Employer Liability Rejected in ADA Employment Discrimination Case

In Whitaker v. Milwaukee County, Wisconsin, decided yesterday, the Seventh Circuit Court of Appeals tossed out former County employee’s claim that Milwaukee County was her employer  within the meaning of the Americans with Disabilities Act (“ADA”), 42 U.S.C. Section 12101, et seq.   Specifically, Whitaker alleged that the County and Wisconsin’s Department of Health Services had failed to accommodate her disability by refusing to extend her period of medical leave, refusing to transfer her to another position, and then terminating her for reasons related to her disability.

The main issue on appeal was whether the County can be held liable under a “joint employer” theory for the employment actions of state supervisors that are alleged to violate the ADA which prohibits disability discrimination in the workplace.

Employment History

Beginning in 2001, Whitaker worked as a corrections officer for the County. In 2005, she sustained a work-related injury to her back and was later diagnosed with degenerative disk disease.  As a result of this medical condition, she had physician-imposed work restrictions and substantial limitations in a number of tasks including sitting, standing and walking.  Through the County’s relocation program, Whitaker was hired as an Energy Assistance Specialist as an accommodation for her back disability.  Later, in 2008, Whitaker became an economic Support Specialist in the County’s public benefits program where she continued until her termination in 2010.

In 2009, Wisconsin enacted a statute that directed the State’s Department of Health Services (“DHS”) to establish a unit to administer public assistance programs in Milwaukee County. Previously, the County had administered those functions through the unit in which Whitaker worked.  Following the transition to state management, Whitaker remained an employee of the County, but worked in the DHS unit, now called Milwaukee County Enrollment Services.  She retained her County badge and her membership (with seniority) in the union of County employees. She was compensated and received benefits from the County. The arrangement conformed to the statute transferring administration to DHS.

However, all of Whitaker’s supervisors were employees of Wisconsin DHS, as required by the statute. DHS managed the day-to-day affairs of the office, with no input from County officials.  In fact, state supervisors had the authority to hire, transfer, suspend, promote and discharge County employees, and supervise County employees performing services for the unit.  DHS employees also administered the leave program and had authority to resolve disputes with the applicable union.  Whitaker did not allege that any County employees had any involvement in any adverse employment actions taken after the transfer to DHS administration was complete.

In 2010, Whitaker went out on medical leave and did not return as scheduled. On November 15, 2010, DHS provided Whitaker with a notice of intent to terminate her for medical reasons relying on state statutory authority for termination of an employee who has exhausted available leave and remained unable to return to work.  The letter also set a meeting on November 18, to discuss the proposed action.  Whitaker attended the meeting along with her union representative, and confirmed she was unable to return to work. DHS representatives reiterated their intent to terminate her, and terminated Whitaker effective November 30, 2010 for medical reasons.

Meanwhile, on November 3, 2010 – prior to receiving DHS’ notice of intent to terminate- Whitaker had filed a charge with the EEOC alleging ADA disability discrimination naming both Milwaukee County and Wisconsin DHS as employers.  The EEOC issued a right to sue letter and Whitaker filed a federal lawsuit.

Joint Employer Liability

The court in Whitaker acknowledged that complex relationships sometimes exist between employees and employers for which they work, and that courts have fashioned different tests to determine when a particular employer may be subject to liability under the ADA and related civil rights employment statutes. One such test is the joint employer theory which acknowledges that two employer entities are, in fact, distinct, but concerns whether each exercises sufficient control over the terms and conditions of employment such that they are “joint employers,” either  of which faces potential liability under the statute.

Importantly,  the court noted that a finding that two companies are an employee’s “joint employers” only affects each employer’s liability to the employee for their own actions, not for each other’s actions.  This finding was fatal to Whitaker’s case.

In the end, the court held that although the County was Whitaker’s official employer and was responsible for her compensation, it had no involvement in the principal decisions that she claims violated the ADA and had no authority to override those decisions made by the State of Wisconsin’s DHS personnel. As a result, the County was not liable and Whitaker’s case was dismissed.