Simon Seeding & Sod, Inc. v. Dubuque Human Rights Comm'n

• Decision Date: 19 May 2017
• Docket Number: No. 16-1014,16-1014
• Citation: 895 N.W.2d 446
• Parties: SIMON SEEDING & SOD, INC., Appellant, v. DUBUQUE HUMAN RIGHTS COMMISSION and Jermaine Stapleton, Appellees.
• Court: Iowa Supreme Court

895 N.W.2d 446

SIMON SEEDING & SOD, INC., Appellant,

v.DUBUQUE HUMAN RIGHTS COMMISSION and Jermaine Stapleton, Appellees.

No. 16-1014

Supreme Court of Iowa.

Filed May 19, 2017

Erik W. Fern of Putnam, Fern & Thompson Law Office, P.L.L.C., Decorah, for appellant.

Les V. Reddick of Kane, Norby & Reddick, P.C., Dubuque, for appellee Dubuque Human Rights Commission.

Charles Gribble and Christopher Stewart of Parrish Kruidenier Dunn Boles Gribble Gentry Brown & Bergmann, L.L.P., Des Moines, for appellee Jermaine Stapleton.

WATERMAN, Justice.

In this appeal, we must decide how to count employees to reach the threshold "numerosity" required to apply a local civil rights ordinance to a small business. The Dubuque ordinance, with language matching the Iowa Civil Rights Act (ICRA), exempts "any employer who regularly employs less than four individuals." The defendant, a landscaper whose hiring needs fluctuate seasonally, denies it met this threshold under its proposed formula of counting only workers who had been employed for twenty consecutive weeks. The Dubuque Human Rights Commission (DHRC) rejected the employer's numerosity challenge, found the employer racially discriminated against a temporary worker, and awarded damages. The district court affirmed. We retained the employer's appeal.

For the reasons explained below, we conclude the DHRC correctly determined that the defendant "regularly employed" the requisite four or more individuals during its landscaping season. The DHRC properly used a payroll approach and rejected the employer's proposed twenty-week test. Because substantial evidence supports the DHRC's findings, we affirm the district court judgment upholding the damages awarded to the former employee.

I. Background Facts and Proceedings.

The agency record establishes the following facts. Simon Seeding & Sod, Inc. (Simon Seeding) operates a seasonal landscaping business based in Dubuque, Iowa. Jermaine Stapleton, now age thirty-three, worked for Simon Seeding in 2006 and again in 2012. Stapleton, an African-American, claims that Simon Seeding's owner, Leo Simon, discriminated against him based on his race.

A. Events Leading to the Complaint. Stapleton grew up in Burnsville, Minnesota, and moved to Dubuque to attend Clarke College. He began working for Simon Seeding in April 2006. Stapleton recalled that Leo regularly referred to him using racial epithets while working, such as "chocolate guy" and "colored lad." Stapleton did not respond "in kind," but in his words,

[A] few times I asked him, you know, not to do it but, you know, it was so continuous that it almost became, you know, an everyday thing so I just kind of took it all in stride because I needed the job so—

Stapleton ceased working at Simon Seeding in September of 2006. He returned to work there six years later.

Meanwhile, in 2008, Stapleton was convicted of possession of a controlled substance and sentenced to probation. In 2009, he was arrested for operating a motor vehicle while intoxicated, and the district court ordered him to the First Judicial District Dubuque Residential/Work Release Facility (work-release facility). Stapleton tested positive for narcotics and was sent to prison. In 2012, he was transferred from prison into the work-release facility, where residents were required to maintain employment. Stapleton approached Frank Berwanger, another resident, about returning to work at Simon Seeding. Berwanger worked for Leo there. Stapleton told Berwanger to tell Leo that he was the "colored guy" who worked for Leo in 2006. Leo did not remember Stapleton, but nonetheless hired him back at $8 per hour for twenty hours per week.

Stapleton resumed working for Simon Seeding on March 15. Leo resumed calling him "chocolate guy," "chocolate lad," and "colored lad." Stapleton estimated Leo made such comments to him two or three times weekly. "Ninety percent of the time" Stapleton would ask Leo not to call him those words. Leo responded, "Oh Jay, don't worry, it's not that big of a deal, I'm just joking." Stapleton obtained another full-time job at Roofco in April, but continued to work for Simon Seeding part-time because he did not want to be disciplined at the work-release facility for quitting.

On May 6, Leo picked Stapleton up from the work-release facility to drive with him to a job site in Wisconsin. Leo stated that Stapleton did not seem "right," and Leo believed he may be "on" something. He asked Stapleton if he really wanted to work that day, and Stapleton said he did. When they arrived at the job site, it was raining and muddy. Leo could not find a chain he needed to pull machinery out of the mud. He said to Stapleton, "Stupid colored mother fucker, find my chain now!" Stapleton responded, "Man, can you please stop calling me that." Leo retorted, "Well, if you don't like it, you can walk home." Stapleton began walking back to the work-release facility, fifty to sixty miles away. A half hour later, a police officer stopped Stapleton to ask why he was walking along the highway. Stapleton explained the situation, and the police officer drove Stapleton back to the job site. The officer told Leo that Leo was responsible for getting Stapleton back to the work-release facility.

Meanwhile, Leo had called the work-release facility and spoken with residential officer Gael Huinker, who made the following notes:

At 1015 hours this date, this RO received a phone call from Leo Simon. Mr. Simon stated that when he picked Mr. Stapleton up for work this date he didn't feel like Mr. Stapleton really felt like working.... Mr. Simon then stated when they got to Dodgeville it was raining so they sat in the truck a while and when it stopped Mr. Stapleton took some pictures and then didn't want to do anything else.... Mr. Simon then asked this RO if we could pick Mr. Stapleton up or if he could walk back. This RO began to ask a lot of questions, asking some of them 2-3 times b/c the whole situation was a bit confusing and Mr. Simon was giving real short answers. Mr. Simon was informed by this RO that Mr. Stapleton was not allowed to walk back to the facility and asked if he could [stay] on site until the end of the day. This RO also asked Mr. Simon to inform Mr. Stapleton that he is not allowed to walk back and to please call us if anything is resolved.

At 10:26 a.m., Leo called back and said Stapleton was "walking over the hill." At 11 a.m., he called again to say a police officer had brought Stapleton back to the job site. At 11:27 a.m., he called a fourth time to report that Stapleton was "taking pictures again" and that "everything had worked out." At 1 p.m., Leo dropped Stapleton off at the work-release facility, and Huinker observed the pair seemed to be getting along and were laughing together. Stapleton informed her it "started over a chain" and that Leo called him a racial slur.

The next day, Stapleton called Leo to pick him up for work. Leo told Stapleton that he did not need him anymore. Stapleton never worked for Simon Seeding again.

Huinker received a complaint from another resident on May 6 about Leo's discriminatory behavior. Stephen Toliver had worked for Simon Seeding for one day when he told Huinker that Leo had called him a "nigger" several times. Toliver told Huinker he "realize[d] Mr. Simon [was] probably just used to saying things like that because he has been doing it for so long." He asked Leo to call him Steve. Leo requested that Toliver not be placed for work with him any longer because he did not think Toliver "was a very hard worker."

Huinker discussed the complaints with Wendy Lyons, the work-release facility's residential manager. Neither Stapleton nor Toliver was disciplined for losing their jobs because they had alleged discrimination. On May 29, Lyons decided the facility would no longer place residents with Simon Seeding. Leo phoned Lyons to protest her decision and called back twice to say he was not racist and did not appreciate being called racist.

B. The Complaint and Investigation. Stapleton filed his complaint with the DHRC on May 16, 2012. He alleged discrimination in violation of Dubuque City Ordinance 8-3-3, the city's counterpart to the ICRA. The DHRC sent the first of eight letters to Leo on May 25, requesting a formal response to the complaint and certain employment documentation. Leo failed to respond. Seven more letters went unanswered as the investigation continued over the next fourteen months. On November 15, 2013, the DHRC requested a subpoena for the employment documentation, including W-2s, copies of payroll records, and a list of employees. In December, the subpoena was served on Simon Seeding. By February 2014, no information had been received. The DHRC contacted Leo, who named his accountant. The accountant responded to the investigator's direct inquiry by providing the DHRC with Simon Seeding's payroll journal and tax information.

The payroll listed the only employees in 2012 as Leo, John Berwanger, Frank Berwanger, and Jesse Weiland, without including Stapleton. The DHRC found a note dated April 3, 2012, at the work-release facility that stated Stapleton had been paid "for 40.5 hours of the week this date." The DHRC found there was probable cause to investigate.

In February 2015, a public hearing was held before an administrative law judge and two commissioners (the panel). Stapleton, his mother, his ex-girlfriend, and Wendy Lyons testified on his behalf. Leo, Frank Berwanger, Greg James, Jody James, and Erica Wiles (other employees) testified for Simon Seeding.

Stapleton testified he overheard Leo refer to him as "colored" or "chocolate" to Berwanger and others at the worksite. He testified about the impact Leo's statements had on him. He had been "happy-go-lucky," "open-minded," and "funny." But Leo's racial slurs changed his attitude:

Q. And did anything change after the series of remarks that you described to us earlier in your testimony? A. I'd say a lot changed. I, you know, went from super high character to, you know,

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