Hernandez v. Data Systems Intern., Inc.
| Decision Date | 10 June 2003 |
| Docket Number | No. 02-2193-JWL.,02-2193-JWL. |
| Citation | 266 F.Supp.2d 1285 |
| Parties | Mark HERNANDEZ, Plaintiff, v. DATA SYSTEMS INTERNATIONAL, INC., Defendant. |
| Court | U.S. District Court — District of Kansas |
Frank B. W. McCollum, Stacy M. Bunck, McCollum & Parks, L.C., Kansas City, MO, for Plaintiff.
Carole K. DeWald, Shirley E. Goza, Stacey A. Campbell, Tina L. Harris, William C. Martucci, Shook, Hardy & Bacon, L.L.P., Kansas City, MO, for Defendant.
Donna K. McElroy, Cox & Smith, Inc., San Antonio, TX, for Sirius Computer Solutions, Inc.
Plaintiff Mark Hernandez filed suit against defendant Data Systems International, Inc. ("DSI") alleging that defendant paid him less and imposed more work assignments than similarly situated non-Hispanic employees, failed to promote him on the basis of his race, terminated his employment based on his race, retaliated against him for filing a discrimination complaint, and subjected him to a racially hostile work environment in violation of Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq., 42 U.S.C. § 1981 and the Kansas Act Against Discrimination, K.S.A. § 44-1001 et seq.
This matter is presently before the court on defendant's motion for summary judgment (Doc. 67). As set forth in more detail below, defendant's motion for summary judgment is granted in part and denied in part. Specifically, defendant's motion is granted as to the Title VII claims and the Section 1981 claims that arose prior to the applicable limitations period. The court further grants summary judgment as to two of the three retaliatory discrimination claims and the hostile work environment claim. The court denies summary judgment with respect to plaintiffs discrimination claims founded on his compensation, job assignments, failure to promote, and termination. The court also denies summary judgment as to his claim of retaliatory discharge.
Plaintiff Mark Hernandez is a male of Hispanic descent. On July 5, 1994, Data Systems International, Inc. ("DSI") hired Mr. Hernandez as a marketing representative. DSI retained Mr. Hernandez for nearly seven years. Throughout this time, DSI did not adopt a formal policy for performing employee evaluations. Other than a written comment from Leo Harris indicating that Mr. Hernandez was a top performer, DSI has no written evaluations of his performance. Moreover, DSI never indicated that his skills or performance were deficient or recommended improvement in any particular area of his job performance.
During his second year of employment, Mr. Hernandez brought in the SYSCO account, DSI's largest sales account, and DSI changed his compensation plan. Mr. Hernandez felt that his compensation package was inadequate. Thus, in June of 1996, he told his supervisor at the time, Gary Swanson, that his compensation structure was not comparable to similarly situated employees. Mr. Swanson suggested he talk with upper management and Mr. Hernandez subsequently discussed the matter with Ken Saathoff. Mr. Saathoff indicated that management felt his efforts did not justify paying him as much as the other Sales Representatives. Mr. Hernandez felt that it was unfair for his compensation plan to be different because of the SYSCO account.
In fiscal year 1998 (June 1, 1997 through May 30, 1998), Mr. Hernandez's title changed to account executive. His compensation included a base salary of $48,000, a 5% gross margin commission on the first $4 million in sales and a 10% gross margin commission on sales thereafter. This commission rate was lower than other similarly situated employees.
In fiscal year 1999 (June 1, 1998 through May 30, 1999), DSI promoted Mr. Hernandez and others to the position of Regional Manager. His total compensation included a base salary of $60,000, a 2% regional operating margin commission and a 5% personal gross margin commission. Sales commissions and bonuses, instead of base salary, constituted the greatest percentage of total compensation. That fiscal year, Mr. Hernandez had the lowest regional operating margin commission rate and the highest quotas of any Regional Manager. In June of 1998 and June of 1999, other similarly situated employees earned revenue based on a higher rate of commission than Mr. Hernandez. Moreover, Mr. Hernandez was the only Regional Manager required to personally service a large client account. Thus, Mr. Hernandez had all of the responsibilities of other Regional Managers, including hiring, opening new offices, introducing DSI into new markets, and carrying the quota and responsibility for the success of his region. At the same time, he performed the same duties as a Sales Representative by personally servicing the SYSCO account. DSI did not separately compensate him for these additional duties.
In fiscal year 2000 (June 1,1999 through May 30, 2000), Mr. Hernandez's compensation included a base salary of $72,000, which was the second highest base salary among Regional Managers. Mr. Hernandez also received a 5% regional operating margin commission. All other Regional Managers had a 5% regional operating margin commission. DSI also imposed the second highest regional gross margin quota ($4.1 million) and the highest regional operating margin quota ($2.6 million) on Mr. Hernandez. Moreover, he was the only Regional Manager with a personal gross margin quota. As in fiscal year 1999, he was required to service the SYSCO account in addition to his Regional Manager duties, without additional compensation.
For the stub year (which ran from June 1, 2000 through December 31, 2000), Mr. Hernandez's total compensation included an annual base salary of $108,000 and a 5% regional operating margin commission. The other Regional Managers had the same base salary (or lower) and the same regional operating margin commission, except for Mr. Jurczak, whose base salary was $120,000 and whose regional operating margin commission was 8%. However, from June of 2000 through December of 2000, DSI required Mr. Hernandez to manage both his Southwest Region and the West Region. This duty was imposed in addition to his ongoing duty to service the SYSCO account. DSI did not compensate Mr. Hernandez for this additional duty.
Commencing January 1, 2001, DSI began operating under a new structure with one sales force for services, software, and hardware. Previously, there were three separate sales divisions: one for services, one for software, and one for hardware. As part of the restructuring, all DSI Regional Managers, including Mr. Hernandez, were promoted to Regional Directors. DSI held each Regional Director responsible for the performance of his or her region. After his promotion to Regional Director, he was on an incentive compensation plan that did not include a commission component. All Regional Directors were on the same incentive compensation plan. One month into the restructuring, on January 27, 2001, DSI increased Mr. Hernandez's base salary to $145,000 for calender year 2001. For the four months of 2001 preceding Mr. Hernandez's termination, his wages totaled just over $84,700.
In 2000, DSI was planning to restructure its organization. As part of this restructuring, Mr. Hernandez learned, in March of 2000, that the company contemplated creating a new position, the Vice President of Sales. On April 19, 2000, Mr. Hernandez requested a promotion to Vice President of Sales in a letter to Bill Conwell, Senior Vice President of Sales and Marketing. Mr. Hernandez and Mr. Conwell met to discuss the request. During the meeting, Mr. Hernandez explained why he thought he was qualified for the position. Mr. Conwell agreed that he was qualified, but explained that Ken Saathoff and Mike McGraw would make the final decision.
In late 2000, DSI approved the positions of Vice President of Sales and Director of Strategic Alliances. By January of 2001 DSI had committed budget dollars to the new positions. DSI never informed Mr. Hernandez he would not be promoted to the new position. He first realized that he would not be promoted when DSI terminated his employment on April 30, 2001.
DSI lost approximately $2 million in January and February of 2001. In response, DSI decided to reduce its work force to minimize the financial losses of the company. DSI instructed the senior vice president of each respective business area to select employees for termination. Mr. Conwell selected Mr. Hernandez for termination and Mr. McGraw and Mr. Baldwin approved the selection. As discussed herein, DSI proffers a variety of bases for selecting Mr. Hernandez.
At the time DSI was implementing its reduction in force, Mr. Hernandez was one of six Regional Managers (Bob Cate, Scott Kephart, Mike Jurczak, David Leyton and Mike Murphy). From January 1, 2001 through April 30, 2001, three regions were unprofitable. The managers of those regions included Mr. Hernandez, Mr. Kephart and Mr. Murphy. DSI selected Mr. Hernandez and Mr. Kephart for termination, but offered Mr. Murphy another position within the company. The Regional Director position was not eliminated, but DSI consolidated its regions and retained only three Regional Directors (Mr. Jurczak, Mr. Cate, and Mr. Leyton). Mr. Hernandez's Southwest Region was merged into the Central Region.
Denia Milne, Vice President of Human Resources, informed Mr. Hernandez that he was being terminated because DSI decided to "get out of the commodity hardware reselling business."
On the morning of April 19, 2001, Mr. John Rockeman, Vice President of Solutions Development, called Mr. Hernandez a "stupid spic." Denia Milne, Vice President of Human Resources, overheard the racial slur. Mr. Hernandez complained to Ms. Milne regarding Mr. Rockeman's comment. He told her that it was inappropriate for Mr. Rockeman to use such derogatory...
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