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Summary Judgment Dismissing Claims of Pregnancy and Disability Discrimination Affirmed by the Tenth Circuit

ABSTRACT: Did you know that an employee can demonstrate an adverse employment action in support of the employee’s discrimination claim when there is a significant risk of humiliation, damage to reputation, and a concomitant harm to future employment prospects? Recently, the U.S. Court of Appeals for the Tenth Circuit analyzed whether an employee met this threshold when it decided whether the District Court’s grant of summary judgment in favor of the employer was proper.

In Ortiz v. Bank of Labor, a Hispanic female employee, who was pregnant, filed suit against her employer for alleged violations of the Americans with Disabilities Act and the Pregnancy Discrimination Act. The District Court granted summary judgment in favor of defendant Bank of Labor on both counts and the Employee appealed.

Regarding the disability claim, the District Court followed established precedent that pregnancy alone without a related mental or physical impairment is insufficient to meet the definition of “disability” under the ADA and ADAAA. Because the Employee did not allege any mental or physical impairment related to her pregnancy, the District Court entered summary judgment in the Bank’s favor. Employee ultimately abandoned her ADA claim on appeal. This is important to note because, in issuing its decision, the Tenth Circuit was not evaluating whether Employee’s use of an unapproved chair amounted to a request for a reasonable accommodation for swollen feet.

Instead, the limited issues before the Tenth Circuit Court of Appeals were whether Employee had been subjected to an adverse employment action based on her pregnancy, due to (1) the denial of the use of a preferred restroom; and (2) the denial of the use of a preferred chair. Additionally, the Court of Appeals was tasked with deciding if Employee established a genuine issue of disputed material fact on the question of whether the Bank’s proffered justification for her termination was pretextual.

Appeal – Adverse Employment Action Issues

The Tenth Circuit stated the familiar principle that an employee claiming discrimination must first put forth prima facie evidence that the employee suffered an adverse employment action. It is well-settled that adverse employment actions may include: terminations, demotions, suspensions, decreased pay or benefits, and the failure to promote. The Court further noted that an employee can satisfy the “adverse employment action” threshold by showing the employer’s conduct carried a significant risk of humiliation, damage to reputation, and a corollary harm to future employment prospects. The Court stressed, however, that a mere inconvenience or an alteration of job responsibilities does not qualify as an adverse employment action.

First Alleged Adverse Action – Denial of Preferred Restroom

Here, the Bank, a small branch location, was connected to a 7-Eleven. The 7-Eleven restrooms were also the Bank employees’ restrooms. Employee found those bathrooms to be dirty and preferred to leave the Bank to walk across the parking lot to use the restrooms located in a nearby McDonalds. The Bank had a policy that did not allow for there to be only one employee in the branch, because it posed a security risk. At a minimum, the Bank required that there be two employees in the bank at all times. If there were three or more employees in the Bank, Employee could leave the Bank and use the bathrooms she preferred. However, when the staffing fell below three, she would not be able to leave the Bank and would have to use the 7-Eleven connected bathrooms, which she could use at any time.

Employee claimed, as a pregnant female, she required more frequent trips to the restroom. Employee argued that the Bank’s policy about leaving the branch created a “significant risk of humiliation”, as well as a “risk of physical discomfort”, which amounted to an adverse employment action. The Court of Appeals rejected this argument, finding the inability to use her preferred restroom was a “mere inconvenience”. The Court noted Employee did not cite any case authority to support the “risk of physical discomfort” as an adverse employment action. The Court further advised that Tenth Circuit case law regarding “risk of humiliation” requires “a concomitant harm to future employment prospects.” The Court of Appeals found Employee failed to establish this was a likely result. Because she had not demonstrated she suffered an adverse employment action in connection with her pregnancy, the Court of Appeals affirmed the District Court’s grant of summary judgment on Employee’s discrimination claim based on the inability to use her preferred restroom.

Second Alleged Adverse Action – Denial of Preferred Use of Chair

Employee’s feet started swelling, which she attributed to her pregnancy. To manage this, she began sitting on a small folding chair she kept in her cubicle, except when helping a customer. The branch supervisor then instituted a new rule that the chairs used in the drive-through window area were the only authorized chairs. Employee complained that those chairs would not fit in her cubicle and she could not carry them back and forth, which complaints were ignored. Consequently, Employee argued she was forced to stand.

In her lawsuit, Employee claimed the Bank’s denial of the use of her preferred chair resulted in an adverse employment action. She did not offer any supporting authority or even argument in support of her position. The Court was also unable to find any authority treating this sort of working condition as an adverse employment action, as opposed to the denial of a reasonable accommodation under the ADA (which was not made part of the case on appeal).

On appeal, Employee again claimed the Bank’s conduct carried a significant risk of humiliation, as well as a risk of physical discomfort (without citation). However, as with her argument in support of the denial of her preferred restroom, Employee ignored the requirement of a “concomitant harm to future employment prospects.” The Tenth Circuit again agreed with the District Court and affirmed the grant of summary judgment on the basis that Employee failed to carry her burden that she suffered an adverse employment action.

Appeal of Termination – Pretext Analysis

            The Incident

Employee was working with her supervisor. The supervisor restocked her teller draw with $25 in pennies but forgot to document that withdrawal from the vault.  At the end of the shift, Employee and a coworker counted the cash in the vault to make sure it matched documented additions and subtractions. They found the $25 difference. Employee asked if anyone had documentation that they failed to submit and either received “nos” or no answer. Employee then used white-out to cover over the starting cash amount on the vault log, and wrote in a new figure, $25 lower. This caused the vault discrepancy to disappear. Employee’s modification of the vault log in this manner is called “force balancing”. There were at least three different bank policies that list “force balancing” as a terminable offense.

            The Termination

At the end of the day, the supervisor recalled she failed to document the earlier withdrawal and reported it to the branch manager. The supervisor admitted she caused the vault log to be out of balance. When subsequently questioned about this incident, Employee denied intentionally force balancing the log, claiming, instead, she was suffering from “pregnancy brain”. Employee was fired roughly two weeks later because she force balanced the vault log in violation of several bank policies.

            Employee Claims Justification for Termination Was Pretextual 

The District Court granted summary judgment on the basis Employee failed to present sufficient evidence that the Bank’s proffered justification of force balancing the vault log in violation of multiple Bank policies was a pretext for discrimination. On appeal, Employee argued she presented three pieces of circumstantial evidence from which a jury could find pretext.

First, Employee argued, her supervisor was a similarly situated, non-pregnant employee, who violated Bank policy and was not terminated. The Court rejected this argument and distinguished the supervisor’s actions, noting her failure to document caused the vault to be out of balance; however, the supervisor did not attempt to cover over that difference with false recordkeeping entries, like Employee.

Next, Employee argued the force balancing incident occurred nearly two-weeks before her termination. She claimed this delay was inconsistent with the seriousness the Bank was attributing to the offense.  She pointed to deposition testimony of the branch manager, who did not know why the person with authority to suspend Employee did not do so earlier. The Court rejected Employee’s argument, finding she failed to raise a genuine issue of pretext.

Finally, Employee alleged the branch manager described force-balancing “like theft” and “an intentional act” during her deposition; however, Employee argued a jury could find this testimony false because Employee claimed her actions resulted from “pregnancy brain”. The Tenth Circuit stated it did not see the connection Employee was trying to make. Instead, the Court of Appeals agreed with the District Court that there was nothing in the record to suggest the Bank did not view force balancing as the true reason for her termination.

Key Takeaway

This case serves as an important reminder that an adverse employment action is not limited to terminations, demotions, suspensions, and the like.  Instead, a plaintiff may be able to establish he or she suffered an adverse employment action if the employer’s conduct shows a risk of significant humiliation, damage to reputation, and a corollary harm to future employment prospects. The plaintiff here was not able to meet this threshold; however, one can easily envision other allegations that would likely satisfy these criteria. Appropriately, the Court also advised a mere inconvenience or an alteration of job responsibilities still will not qualify as an adverse employment action.

This case also serves as a lesson to employers that strong consistent policies that state the grounds for terminable offenses can save the day. Here, the plaintiff may have missed the mark by not focusing more on her disability claims. With the swelling, it seems possible that she could have established a physical condition related to her pregnancy that would have qualified under the ADA. If so, it also seems likely she may have had a viable claim for failure to provide reasonable accommodation under the circumstances. From a defense perspective, under the circumstances, denying the use of the fold-up chair seemed like an unnecessary risky decision.

Also, be aware that a new law goes into effect June 27th, which would have likely mandated a different result. The Pregnant Workers Fairness Act (PWFA) requires covered employers to provide “reasonable accommodations” to a worker’s known limitations related to pregnancy, childbirth, or related medical conditions, unless the accommodation will cause the employer an “undue hardship”.  Once it takes effect, pregnant workers no longer need to establish a physical or mental impairment under the ADA in order to be entitled to a reasonable accommodation.

* Kaleb McKinnon, 2023 Summer Law Clerk, assisted in the research and drafting of this post. McKinnon is a rising 3L student at Drake University Law School.