(Revised as of 4/12/12)

On March 28, 2012, legislation was introduced before the New York City Council (“NYC Council”) that, if enacted, will extend employment discrimination protections to unemployed job seekers.  In a climate of persistently high unemployment rates and many discouraged – and disgruntled – jobless persons, it should come as no surprise that, along with New York City, legislatures across the nation are considering drastic measures.  Some of these laws have even passed. 

A year ago, New Jersey was the first state out of the gate when it enacted legislation to protect unemployed job seekers.  New Jersey’s legislation, however, is much narrower than many subsequent efforts by state and local governments to protect the jobless.  Specifically, New Jersey only prohibits job advertisements that exclude unemployed candidates.  The legislation explicitly precludes a private cause of action for spurned job hunters.  Rather, it provides for fines ranging from $1,000 for the first violation, $5,000 for the second violation, and $10,000 for additional violations.

Contrast the District of Columbia’s new legislation, signed by the mayor March 19, 2012 and currently undergoing its (usually pro forma) review by Congress.  This law prohibits an employers or employment agencies  from not only disqualifying unemployed persons in want ads, but also from failing or refusing to “consider” or “hire[] an individual as an employee because of the individual’s status as unemployed.”  The legislation expressly permits employers and employment agencies to “examin[e] the reasons underlying an individual’s status as unemployed” when ”making employment decisions,” including “assessing an individual’s ability to perform a job.”  Like the New Jersey law, the legislation forecloses a private cause of action and, instead, empowers the District of Columbia Office of Human Rights to fine offenders.  

The legislation introduced before the NYC Council more closely resembles the District of Columbia’s legislation than it does New Jersey’s.  The proposed law seeks to broadly ban employers and employment agencies from basing employment decisions “on the unemployment status of the applicant or employee.”  The scope of the legislation, however, is somewhat limited by an exemption that permits employers to “request[] or us[e] unemployment status information that is substantially job related” for a “bona fide reason.”  The proposed law also allows employers to “inquir[e] into the circumstances surrounding an applicant’s or employee’s previous termination or demotion, including whether such adverse action was based on cause.”  Additionally, the legislation would proscribe job ads that exclude unemployed applicants.  Under the New York City Human Rights Law, of which this proposed legislation is part, employees benefit from an expansive, employee-favorable interpretation, a three-year statute of limitations, and the full array of damages, including punitive damages.  Thus, unlike the District of Columbia and New Jersey laws, disappointed job seekers have a private cause of action.

With respect to prohibiting employers from issuing advertisements that exclude jobless applicants, these provisions are less controversial and, to whatever extent this practice exists, inadvisable.  Besides fairness issues and potential bad press, this practice may also lead to litigation under existing anti-discrimination laws.  The NYC Council’s press release announcing the legislation highlighted the potential disproportionate impact on minorities due to the higher rates of unemployment among African Americans and Hispanics.  At an Equal Employment Opportunity Commission meeting last year that explored the treatment of unemployed job seekers, a Department of Labor representative also reviewed statistics and concluded that such exclusions may cause “disparate impacts among racial minorities, among workers with disabilities, and among older workers.” 

But transforming unemployment status into a protected category is a horse of a different color.  This blog has previously commented on the nettlesome nature of a similar proposal in the context of President Obama’s American Jobs Act.  Although a job applicant’s race or gender (for example) bears no rational connection to an applicant’s qualifications for a particular job, an applicant’s job history – including its continuity and the reasons for any gaps – may relate to an applicant’s relative merit for a particular position.  A job seeker who has been unable to obtain, or retain, employment due to an inability to show up to work (or interviews) on time is justifiably a less attractive candidate than someone who, all other things being equal, has no punctuality issues.  The explanation that “I decided not to hire the candidate who was fired for persistent tardiness” might tread uncomfortably close to unlawfully considering an individual’s status as unemployed.  Notably, the New York City law would permit employers to inquire about the employee’s termination for tardiness.  But, in litigation, the employer would have to undergo the burden of proving that punctuality was “substantially job related” and that it had a “bona fide reason” for using the information regarding the prior termination in making its decision.    

Although legislators are rightly concerned with assisting jobless persons and reducing barriers to their re-entry into the workforce, the unintended consequence of these laws may be to increase the cost of doing business for employers due to an influx of new lawsuits by rejected applicants.  This result might increase the employment opportunities for labor and employment attorneys, but not the millions of unemployed.     

The New Jersey Supreme Court issued a lengthy, sweeping decision on August 24^th on the standards for evaluating eyewitness testimony in criminal cases that is garnering national, and even international, attention.  See NY Times report by clicking here; Wall Street Journal report by clicking here; Reuters report by clicking here. Though the case entitled State v. Larry Henderson and its companion case entitled State v. Cecilia, both available here,  involved eyewitness identification testimony, the Supreme Court dealt at great length with more general issues eyewitness testimony and “how memory works.”  Those parts of the opinion may be especially helpful in challenging the memory of plaintiffs and witnesses in employment cases generally, and in hostile environment claims in particular.

Why would that be the case?  Well, the Supreme Court reviewed a wide variety of scientific studies on memory and eyewitness recounting of events to note that “an array of variables can affect and dilute memory.”  The scientific literature divides these variables into what are known as system variables (those which define the structure or structures in which the event is reported or recounted) and estimator variables (those which relate to the witness and the specific experience(s) being recounted).  Understanding the latter may be quite helpful in undermining witness credibility and memory in a hostile environment case.

It is important to note that the New Jersey Supreme Court has essentially come out against the notion of perfect recall or photographic memory:

Research contained in the record has refuted the notion that memory is like a video recording, and that a witness need only replay the tape to remember what happened. Human memory is far more complex.  The parties agree with the Special Master’s finding that memory is a constructive, dynamic, and selective process.

The process of remembering consists of three stages: acquisition — “the perception of the original event”; retention — “the period of time that passes between the event and the eventual recollection of a particular piece of information”; and retrieval — the “stage during which a person recalls stored information.” Elizabeth F. Loftus, Eyewitness Testimony 21 (2d ed. 1996). As the Special Master observed,

[a]t each of those stages, the information ultimately offered as “memory” can be distorted, contaminated and even falsely imagined. The witness does not perceive all that a videotape would disclose, but rather “get[s] the gist of things and constructs a “memory” on “bits of information . . . and what seems plausible.” The witness does not encode all the information that a videotape does; memory rapidly and continuously decays; retained memory can be unknowingly contaminated by post-event information; [and] the witness’s retrieval of stored “memory” can be impaired and distorted by a variety of factors, including suggestive interviewing and identification procedures conducted by law enforcement personnel.

[Internal citations omitted.]

…Science has proven that memory is malleable. The body of eyewitness identification research further reveals that an array of variables can affect and dilute memory…

Memories fade with time.  And as the Special Master observed, memoray decay “is irreversible”; memories never improve…

Understanding some of the variables recognized by the Court can be important when dealing with the hostile work environment plaintiff and witnesses.

Think about the hostile work environment case.  It is usually one in which any number of different circumstances, statements, actions and inactions over a course time involving any number of participants move in and out of relevant events, and it is often a case in which the differing perspectives of parties and witnesses mean much.  The differences in perspective as to what was said or done, and more importantly what it meant or was intended to mean, are at the heart of such cases.  Thus, anything which impacts on a plaintiff’s or other witness’s perception and memory of what occurred will influence the testimony and therefore outcomes.

For instance, the Supreme Court noted that “confirmatory feedback” makes witnesses much more confident in correctness of their perception and recollection of events, even though the person or persons providing such feedback may not themselves have shared the same experience as the witness.  What that means in the harassment context is that such feedback to a person raising a question as to whether what they just experienced was actionably hostile may be influenced to now “recall” it as hostile based on the feedback rather than experience itself if a friend, family member, or lawyer provides feedback of that sort to the initial report.  This is the process through which an ambiguous event becomes a more certain memory.

Likewise, the Supreme Court noted that scientific research confirms that stress can diminish an eyewitness’s ability to recall” and that stress can impact negatively on the ability of a witness to recall details.  That presents defense counsel in an hostile environment case with a unique Catch 22 opportunity—when the plaintiff claiming a highly stressful work environment provides vividly detailed testimony, counsel has scientific and legal back up to now construct arguments that say if plaintiff was as stressed as plaintiff suggests, plaintiff was wrong on the important details, and that if plaintiff is so right about the details, then plaintiff could not have been that stressed.

Next, the Supreme Court observed that “[s]tudies show that witness memories can be altered when co-witnesses share information about what they observed” and that “co-witness feedback may cause a person to form a false memory of details that he or she never actually witnessed.” In noting that this impact is more likely to take effect among witnesses with an existing or ongoing relationship than among witnesses that are strangers to one another, the Court noted that witnesses who have such ongoing relationship “were significantly more likely to incorporate information obtained solely from their co-witnesses into their own accounts.”  This phenomenon can be particularly problematic in a hostile environment case where “pervasiveness” is often proven by multiple witnesses testifying to having experienced the same conduct or circumstance independently and repeatedly.  When the psycho-social “group memory” dynamic of a group of close knit coworkers could influence one or more witnesses to incorporate into their individual memory something they themselves did not actually experience, the testimony provided may suggest a degree of pervasiveness that actual experience does not support.  Defense counsel that understands that possible dynamic can structure discovery and trial to expose facts and arguments that will benefit his or her employer client.

Whether or not counsel ever has reason to expressly cite State v. Larry Henderson in defending an employer in harassment or discrimination case, employers’ counsel are well advised to understand what the New Jersey Supreme Court has said about witness memory and eyewitness testimony.  Understanding these statements will help counsel structure examinations and arguments that will help their clients.

A recent settlement with the Department of Labor’s Office of Federal Contract Compliance Programs (the “OFCCP”) has once again made clear that, if an employer is a federal government supply and service contractor or subcontractor subject to the affirmative action/non-discrimination obligations imposed by Executive Order 11246, including the obligation to develop and maintain a written affirmative action program, it is imperative that the employer properly track its applicants and hires.

Such tracking should include documenting the gender and race/ethnicity of each applicant, the stages of the selection process at which each applicant meeting the minimum qualifications for the position is considered, and the reason(s) why such applicant is not hired. Records obtained and generated during the hiring process, including resumes, applications and interview notes, also need to be kept to support each hiring decision.

Why is tracking such data and maintaining such records necessary?  Because contractors and subcontractors with fifty (50) or more employees having a supply and service contract in excess of $50,000 with the federal government (or a covered contractor) must develop and maintain a written affirmative action program that is subject to a compliance review by the OFCCP. With each compliance review, the OFCCP is analyzing an employer’s applicant/hiring data, and, where the analysis statistically reveals adverse impact, it is putting the burden on the employer to justify its hiring decisions.  If an employer is unable to justify one or more of its hiring decisions, it may be required to pay out significant back-pay to those applicants that were not hired.

Case in point, the OFCCP recently announced that Alcoa Mill Products Inc. will pay $484,656.19 in back wages to 37 Hispanic and African-American applicants as well as $35,516.88 to two female applicants, all of whom were rejected for material handler positions at the company’s plant in Lancaster, Pennsylvania.  These payments were the result of a scheduled compliance review for the period from 2009 to 2010.  Entering into a conciliation agreement, Alcoa has also agreed to extend job offers to nine of the identified class members as positions become available, to conduct EEO, anti-harassment and sensitivity training for employees, including managers and human resources personnel involved in hiring, and to revise its selection process for material handlers. (See OFCCP News Release http://www.dol.gov/opa/media/press/ofccp/OFCCP20111168.htm).

To avoid a similar result, employers must ensure that they are properly tracking their applicants and hires.  They also need to analyze their applicant/hiring data to identify potential adverse impact.  Where the statistical results of such analysis indicate adverse impact in hiring, employers need to review the hiring decisions made to ensure that each decision is justifiable, and that the employer has the documentation to support it.