E.E.O.C. v. Service News Co.
| Decision Date | 23 March 1990 |
| Docket Number | No. 89-2956,89-2956 |
| Citation | 898 F.2d 958 |
| Parties | 52 Fair Empl.Prac.Cas. 677, 53 Empl. Prac. Dec. P 39,736, 58 USLW 2618 EQUAL EMPLOYMENT OPPORTUNITY COMMISSION, Plaintiff-Appellee, v. SERVICE NEWS COMPANY, Defendant-Appellant. |
| Court | U.S. Court of Appeals — Fourth Circuit |
Michael Murchison, Murchison, Taylor, Kendrick, Gibson & Davenport, Wilmington, N.C., for defendant-appellant.
John Boling Meuser, Sr. Trial Atty., E.E.O.C., Raleigh, N.C. (Charles A. Shanor, Gen. Counsel, Gwendolyn Young Reams, Associate Gen. Counsel, Lorraine Davis, Asst. Gen. Counsel, E.E.O.C., Raleigh, N.C., on brief), for plaintiff-appellee.
Before WIDENER and CHAPMAN, Circuit Judges, and HOFFMAN, Senior District Judge for the Eastern District of Virginia, sitting by designation.
Service News Company appeals the district court's judgment that it unlawfully discharged an employee because of her pregnancy, and also appeals the award of back pay, medical expenses, and attorney's fees to the employee. We affirm in part, reverse in part, and remand for a recalculation of damages consistent with this opinion and for a reconsideration of the attorney's fee.
Service News Company is a distributor of periodicals and books in Wilmington, North Carolina. Its general manager, Leslie D. Heck, hired Nancy K. Phillips as a scanner operator on July 3, 1985. Phillips was eighteen years of age and her position with Service News was her first public employment. As scanner operator, Phillips had to lift boxes of magazines weighing in excess of 25 pounds. Heck considered Phillips to be a satisfactory employee.
Seeking to determine the cause of health problems, Phillips made several visits to the New Hanover Health Department. Two pregnancy tests administered during the course of visits on September 19 and October 3, 1985 were negative. Phillips was absent from work for medical reasons on part of October 21, all of October 22 and part of October 23, 1985. On each occasion, she communicated her absence to appropriate employees at Service News. On October 22, 1985, a pregnancy test administered to Phillips at the New Hanover Health Department was positive.
Phillips called Service News and asked the receptionist to inform Heck that she had tested positively for pregnancy. Later that day, Heck called Phillips' husband and left a message that he wanted to see Phillips. Prior to meeting with Phillips, Heck interviewed Robin Anderson and showed her Phillips' scanner job. That evening, Heck hired Anderson for the scanner job.
Phillips and Heck met at Service News on October 23. Heck claimed at trial that he called the meeting to discuss Phillips' absences and his having seen her at a video store, but neither topic was broached during the meeting. Instead, the focus of discussion made clear that Heck's primary reason for the meeting was to discuss Phillips' continued employment in light of her pregnancy. At this time, Heck repeatedly expressed concern about Phillips' pregnancy and the possibility of injury should she continue working. He recounted the experiences of two employees who had difficulties in continuing to work in other positions because of their pregnancies. Phillips informed Heck that her doctor had approved her continued employment. She expressed her desire to continue working and her financial need to do so. However, Phillips concluded that she was being discharged. Immediately after the meeting, she told two fellow employees that she had been fired because she was pregnant.
During the meeting, the parties also discussed the possibility of unemployment compensation and continued health insurance benefits. Heck suggested that Phillips might retain the company insurance for three months if she paid the premiums herself, and that after that period she might qualify for a non-group policy. Phillips made payments to Service News after her termination; however, the insurance company shortly advised her that she was not eligible to continue benefits and Service News later refunded the money she had paid in premiums. Phillips attempted to obtain other insurance to cover her pregnancy but was unable to do so because her pregnancy was a pre-existing condition.
Following her termination, Phillips looked through want ads for employment. Five months after her termination Phillips applied to work with the Piece Goods Shop (Piece Goods), but was rejected because of her pregnancy. After that experience Phillips assumed that further efforts at obtaining employment while pregnant would be futile.
Phillips gave birth on June 24, 1986. She reapplied at Piece Goods on August 8, and began work there on August 11, 1986. She worked at Piece Goods until September 1986, but voluntarily quit her employment because transportation and child care costs exceeded what she could reasonably expect to earn. On December 9, 1986, she obtained employment with Williams Cleaners. She continued work there until mid-February 1987, at which time she again voluntarily quit her employment because the employer wanted to reduce her hours, and her expenses made part-time employment economically unfeasible. She did not work again until she was rehired by Service News on June 10, 1987.
During two periods of unemployment between September 1986, when she left Piece Goods, and June 1987, when she was rehired by Service News, Phillips continued to look for work. She submitted numerous applications for employment.
After her discharge, Phillips filed a charge of discrimination with the New Hanover Human Relations Commission (NHHRC). Phillips was assisted by counsel during the course of NHHRC's administrative process. Although Phillips was ultimately reinstated by Service News, she was unable to obtain complete relief in resolution of the charge. Therefore, the Equal Employment Opportunity Commission (EEOC) filed this action on March 7, 1988, alleging that Service News had discharged Phillips on account of her pregnancy in violation of Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C. Sec. 2000e-2(a) (1981). At the conclusion of a two-day trial, the district court ruled from the bench that Service News had violated Title VII by discharging Phillips on account of her pregnancy. The court awarded Phillips back pay in the amount of $12,059.34 and attorney's fees in the amount of $100.00, as well as attorney's fees to Richard Klein in the amount of $1,325.00. In a separate order, the court awarded Phillips reimbursement for medical expenses associated with her pregnancy in the amount of $2,791.91. Prior to the entry of judgment, Service News filed a motion to amend the judgment to delete the award of attorney's fees, which the district court denied.
Service News asserts error in several of the court's findings of fact. First, it argues that Heck did not discharge Phillips. Although Heck testified that he believed that Phillips agreed with his concerns and left his employ voluntarily, we find that there is ample evidence to support Phillips' and the court's conclusion that she was discharged. The issue rested in part on Phillips' credibility, which appellant does not contest. The court's finding that Phillips was discharged is not clearly erroneous.
Service News also contests the court's finding that Phillips was not pregnant on September 10, 1985, the date she enrolled in appellant's insurance plan. Had Phillips been pregnant on that date, she would not have received any medical benefits due to a pre-existing condition exclusion. The court's finding was not clearly erroneous in light of admitted medical records of negative pregnancy tests administered on September 19 and October 3, 1985.
Appellant is on firmer ground in its claim that the district court erred in computing the back pay award. Phillips gave birth on June 24, 1986. The lower court assumed that Phillips was able to return to work on July 24, 1986, and directed back pay to resume as of that date. However, Phillips did not actually return to work until August 11, 1986, when she began work at Piece Goods, and there is no contrary evidence in the record to justify the use of an earlier date. Therefore, the back pay award should be recalculated using August 11, 1986, as the earliest date that Phillips would have been able to return to work after the birth of her child. Back pay was not awarded for that period of time following the birth during which Phillips would have been on unpaid leave from Service News.
Service News argues that the trial court committed further error by failing to make certain findings of fact. We do not agree that the issues presented required the court to make any additional findings, and find no error in this respect.
Service News contends that the court should have made a finding on the theory of constructive discharge, since the words "discharged" and "fired" were not used during the meeting between Phillips and Heck. 1 However, neither party proposed that theory at trial, and no evidence was presented in support of that theory. No specific words need be present to support a finding of actual discharge, and actual discharge rather than constructive discharge was appropriate to this case.
Appellant also complains of the lower court's failure to address the defense of business necessity, under which its otherwise discriminatory practice may be justified to protect the health of pregnant women and their unborn fetuses. While not limited to a single analytical framework, the affirmative defense of business necessity typically is raised in disparate impact cases. See Wright v. Olin Corp., 697 F.2d 1172, 1185-86 n. 21 (4th Cir.1982). By contrast, this case was analyzed as an overt sex-discrimination claim or, alternatively, as a covert disparate treatment claim to which the analytical framework of McDonnell Douglas Corp. v. Green, 411 U.S. 792, 93 S.Ct. 1817, 36 L.Ed.2d 668 (1973), and its progeny applied. 2 Although "it...
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