Airport Inn, Inc. v. Nebraska Equal Opportunity Com'n

• Decision Date: 13 July 1984
• Docket Number: No. 83-303,83-303
• Citation: 353 N.W.2d 727,217 Neb. 852
• Court: Nebraska Supreme Court
• Parties: , 39 Fair Empl.Prac.Cas. (BNA) 3, 44 Empl. Prac. Dec. P 37,384 AIRPORT INN, INC., Appellant and Cross-Appellee, v. NEBRASKA EQUAL OPPORTUNITY COMMISSION, Appellee, and Michael Sump, Appellee and Cross-Appellant.

Page 727

353 N.W.2d 727

217 Neb. 852, 39 Fair Empl.Prac.Cas. (BNA) 3,

44 Empl. Prac. Dec. P 37,384

AIRPORT INN, INC., Appellant and Cross-Appellee, v. NEBRASKA EQUAL OPPORTUNITY COMMISSION, Appellee, and Michael Sump, Appellee and Cross-Appellant.

No. 83-303.

Supreme Court of Nebraska.

July 13, 1984.

Syllabus by the Court

1. Equal Opportunity Commission: Appeal and Error. On appeal of review by the district court of an order of the Nebraska Equal Opportunity Commission, this court will not disturb the district court's findings of fact if they are supported by substantial evidence. The court will, however, reach independent conclusions with respect to questions of law.

2. Fair Employment Practice Act: Discrimination: Proof. An individual case of discrimination based on the disparate treatment theory will usually be divided into three phases. First, the plaintiff has the burden of proving by a preponderance of the evidence a prima facie case of discrimination. Second, if the plaintiff succeeds in proving the prima facie case, the burden shifts to the defendant to articulate some legitimate, nondiscriminatory reason for the employee's rejection. Third, should the defendant carry the burden, the plaintiff must then have an opportunity to prove by a preponderance of the evidence that the legitimate reasons offered by the defendant were not its true reasons, but were a pretext for discrimination.

3. Fair Employment Practice Act: Damages. Backpay awards under the Nebraska Fair Employment Practice Act must be reduced by earnings or amounts earnable with reasonable diligence by the person or persons discriminated against.

4. Fair Employment Practice Act: Damages. Once an unlawfully discharged employee produces evidence in support of his claim for backpay, contending that he was unable to find comparable work, the employer has the burden of showing that the discharged employee did not exercise reasonable diligence in mitigating his damages.

5. Claims: Prejudgment Interest. Prejudgment interest may be recovered on claims that are liquidated. A claim is liquidated if the evidence furnishes data which, if believed, makes it possible to compute the amount with exactness, without reliance upon opinion or discretion.

6. Claims: Prejudgment Interest. Where a reasonable controversy exists as to the plaintiff's right to recover or as to the amount of such recovery, the claim is generally considered to be unliquidated and prejudgment interest is not allowed.

7. Fair Employment Practice Act: Prejudgment Interest: Damages. Prejudgment interest is not generally allowed on backpay awards under the Nebraska Fair Employment Practice Act.

8. Fair Employment Practice Act: Attorney Fees. In any action or proceeding under the Nebraska Fair Employment Practice Act, the district court, in its discretion, may allow the prevailing party a reasonable attorney fee.

9. Fair Employment Practice Act: Attorney Fees. Unless there are special circumstances a prevailing plaintiff, under the Nebraska Fair Employment Practice Act, should be awarded a reasonable attorney fee for all stages of the proceedings.

10. Fair Employment Practice Act: Damages. Unemployment compensation benefits should be deducted from a backpay award under the Nebraska Fair Employment Practice Act.

Thomas C. Lansworth of Bauer, Galter & Geier, Lincoln, for appellant and cross-appellee.

W. Michael Morrow of Hecht, Sweet, Alesio & Morrow, P.C., Lincoln, for appellee and cross-appellant Sump.

KRIVOSHA, C.J., BOSLAUGH, WHITE, HASTINGS, SHANAHAN, and GRANT, JJ., and COLWELL, District Judge, Retired.

PER CURIAM.

This is an appeal from an order of the district court for Lancaster County, which affirmed the decision of the Nebraska Equal Opportunity Commission (Commission) that appellant, Airport Inn, Inc., discriminated against the appellee Michael Sump because of his sex, in violation of the Nebraska Fair Employment Practice Act (NFEPA), Neb.Rev.Stat. §§ 48-1101 to 48-1125 (Reissue 1978). We affirm.

Section 48-1104 provides: "It shall be an unlawful employment practice for an employer: (1) ... to discharge any individual ... because of such individual's ... sex ...."

Airport Inn's four assignments of error relate to the proposition that the district court's order was not supported by a preponderance of the evidence and/or was contrary to law. The appellee cross-appeals concerning the issues of the award of backpay, attorney fees, and prejudgment interest.

Our scope of review is limited, inquiring only as to whether or not there is substantial evidence to support the district court's order. We do, however, make our own determination with respect to questions of law. Ranger Division v. Bayne, 214 Neb. 251, 333 N.W.2d 891 (1983); Zalkins Peerless Co. v. Nebraska Equal Opp. Comm., 217 Neb. 289, 348 N.W.2d 846 (1984).

The evidence most favorable to the appellee's position indicates that Airport Inn is a motel located in Lancaster County, Nebraska. A restaurant and a bar/lounge are located within the motel. Sump was hired as a bartender by Airport Inn on October 23, 1976. His beginning wage was $2.75 per hour, and on December 1, 1976, he was given a raise to $3 per hour. Sump was also entitled to receive one free meal for each shift that he worked, the retail value of which was $3. Although we deal with the issue later in the opinion, Sump also contends he earned $50 per week in tips. During the period from January 26, 1977, to and including February 11, 1977, Sump worked 95.5 hours and received 12 free meals. Sump's employment at Airport Inn was terminated on February 14, 1977. Within 2 days after Sump's discharge, Airport Inn hired a female bartender to replace him.

On February 28, 1977, Sump filed a complaint with the Commission, contending that he was fired illegally by Airport Inn because Airport Inn was implementing a policy decision to have all female personnel working in the bar/lounge. Airport Inn asserted that Sump was terminated because he was an unsatisfactory employee.

After conciliation efforts failed a hearing was had before a hearing examiner appointed by the Commission. The hearing was concluded on September 13, 1978. After an unexplained and inexcusable delay of nearly 40 months, the hearing examiner filed his findings of fact, conclusions of law, and recommended an order which contained the following findings: (1) That a policy concerning an all-female bar staff did exist; (2) That such policy discriminated against Sump; (3) That Sump was terminated by Airport Inn without an adequate showing of a legitimate business necessity; (4) That the adoption of the policy concerning an all-female bar staff was the predominate reason for Sump's termination; and (5) That Sump was succeeded in his employment by a female. With respect to damages the hearing examiner found: (1) Sump was terminated in February 1977, and he did not obtain equal, alternative employment for a period of 230 days; (2) While employed at Airport Inn, Sump's average rate of pay per day was $35.37, which resulted in total gross lost wages of $8,135.10; (3) Sump's total interim earnings, including unemployment compensation of $1,080, were $1,952.69; and (4) Sump's net loss was $6,182.41. The hearing examiner made no award of attorney fees, and he did not award Sump any prejudgment interest on the net loss. On March 5, 1982, the Commission entered its final order, in which it adopted into the hearing examiner's recommendations.

The district court, on appeal, held that "[t]he only portion of the [Commission's] order which the court finds not to be supported by a preponderance of the evidence is that which pertains to the computation of damages, based upon tips purportedly received by the claimant." The court went on to reduce Sump's backpay award to $4,695, to affirm the Commission's final order in all other respects, to award no prejudgment interest, and to require that each party pay its own costs and attorney fees.

Because the NFEPA is patterned from that part of the Civil Rights Act of 1964 contained in 42 U.S.C. §§ 2000e et seq. (1976), it is appropriate to look to federal court decisions construing similar and parent federal legislation. See, Richards v. Omaha Public Schools, 194 Neb. 463, 232 N.W.2d 29 (1975); Zalkins Peerless Co. v. Nebraska Equal Opp. Comm., 217 Neb. 289, 348 N.W.2d 846 (1984).

We begin our analysis by finding that the appellee did indeed establish, under the theory of disparate treatment, a prima facie case of sex discrimination. The appellee demonstrated, without rebuttal from Airport Inn: (1) That he was a male employee hired as a bartender by Airport Inn; (2) That he was discharged from that position; and (3) That shortly after his discharge, Airport Inn hired a female bartender to replace him. See McDonnell Douglas Corp. v. Green, 411 U.S. 792, 93 S.Ct. 1817, 36 L.Ed.2d 668 (1973).

Once Sump established his prima facie case, Airport Inn had the burden to rebut the resulting inference of discriminatory intent, because, in light of the prima facie case, a trier of fact presumes that the employer's acts, "if otherwise unexplained, are more likely than not based on the consideration of impermissible factors." Furnco Construction Corp. v. Waters, 438 U.S. 567, 577, 98 S.Ct. 2943, 57 L.Ed.2d 957 (1978). Airport Inn articulated the following reasons for Sump's discharge: (1) Unsatisfactory personal appearance and hygiene. This included improper dress, uncombed hair, a habit of chewing ice cubes and then throwing the ice back into the ice bin, and the use of a bar towel for a personal table napkin and then using the same towel to clean the bar area. (2) Failure to follow company rules and policy. This included eating meals at the bar instead of in the designated employee eating area, drinking in the bar when he was not "clocked out," refusing to wear a uniform, "not marketing drinks," not keeping the bar area neat and clean, and having bad customer...