Kimberly-Clark Corp. v. Labor and Industry Review Commission, KIMBERLY-CLARK

• Decision Date: 06 March 1980
• Docket Number: KIMBERLY-CLARK,No. 79-080,79-080
• Citation: 95 Wis.2d 558,291 N.W.2d 584
• Parties: , 23 Empl. Prac. Dec. P 30,905 CORPORATION, Petitioner-Appellant, v. LABOR AND INDUSTRY REVIEW COMMISSION, Respondent.
• Court: Wisconsin Court of Appeals

Page 584

291 N.W.2d 584

95 Wis.2d 558, 23 Empl. Prac. Dec. P 30,905

KIMBERLY-CLARK CORPORATION, Petitioner-Appellant, v. LABOR AND INDUSTRY REVIEW COMMISSION, Respondent.

No. 79-080.

Court of Appeals of Wisconsin.

Submitted on Briefs June 21, 1979.

Opinion Released March 6, 1980.

Opinion Filed March 6, 1980.

George K. Whyte, Jr., and Patrick W. Schmidt, and Quarles & Brady, Milwaukee, on briefs, for petitioner-appellant; Edward E. Wall and Kimberly-Clark Corp., Neenah, of counsel.

Bronson C. La Follette, Atty. Gen., and Beatrice Lampert, Asst. Atty. Gen., on brief, for respondent.

Before GARTZKE, P. J., and BABLITCH and DYKMAN, JJ.

BABLITCH, Judge.

This is a sex discrimination case brought by Virginia LeMere (complainant) pursuant to the Wisconsin Fair Employment Act (WFEA), secs. 111.31-111.37, Stats. Kimberly-Clark Corporation (company) appeals from a judgment of the circuit court for Dane County affirming the order of the Labor and Industry Review Commission (commission). The order required the company to cease and desist from a policy of excluding pregnancy from its short-term group disability plan, and to pay the complainant the benefits she would have received if covered by the plan during that portion of a two-month maternity leave during which the commission found her to be disabled.

The complainant was employed by the company as a clerical worker at all times material to this controversy. In January 1975 she advised the company that she was pregnant. In February 1975 the company initiated a short-term disability plan for its personnel. The plan provides maximum benefits of full salary during absences from work due to disability. It excludes coverage for disability resulting from self inflicted injury, military service, participation in war or acts of war, and pregnancy.

Following her receipt of a copy of the plan and a discussion of the pregnancy exclusion with her supervisor, the complainant filed a complaint with the Equal Rights Division of the Department of Industry, Labor & Human Relations alleging that the plan discriminated against her on the basis of sex in violation of WFEA. ¹ An initial determination was issued by the agency on July 10, 1975, finding probable cause to believe that such discrimination had occurred. The matter was certified to hearing after conciliation efforts failed. No hearing was held until after the birth of the complainant's child.

Prior to the probable cause finding, and in accordance with company policy, the complainant submitted a request on May 29, 1975 for a maternity leave of absence to commence August 2, 1975 and to end on or about October 6, 1975. Along with her request she submitted a letter from her doctor estimating her date of delivery as August 12, 1975, and stating that the complainant "may work as long as she is comfortable."

The maternity leave was granted. The complainant left her employment on August 2, 1975 and returned to work on October 6, 1975. Her baby was born on August 12, 1975. The complainant was hospitalized from August 12 through August 15, 1975. At the time she commenced her leave the complainant was entitled to three weeks of paid vacation time which she applied to the first three weeks of her absence.

After a hearing, the examiner recommended findings of fact, conclusions of law, and an order which were adopted in their entirety by the commission. Among the findings of fact were the following:

5. Complainant was disabled from working due to maternity from August 2, 1975, until August 22, 1975.

7. Complainant did not receive any payments under the short term disability plan for her maternity leave of absence.

8. Complainant opted to take her three weeks of vacation pay during her maternity leave because she was told she could not receive weekly payments under the short term disability plan.

The commission concluded that the company's failure to make disability payments during the period of actual disability as found by the examiner constituted discrimination on the basis of sex under WFEA. Its order was affirmed in all respects by the circuit court following a ch. 227, Stats., review.

The company raises the following issues on this appeal:

1. Whether the evidence is sufficient to support the commission's finding that the complainant was disabled due to maternity between August 2 and August 22, 1975.

2. Whether the federal Employee Retirement Income Security Act of 1974 (ERISA) preempts the WFEA, thus rendering ERISA the "sole regulator" of employee benefit plans.

3. Whether a group employment disability insurance plan covering pregnancy-related disabilities violates the provisions of the federal Equal Pay Act of 1963.

The company does not contend that the complete exclusion of pregnancy-related disabilities under its disability plan does not constitute sex discrimination under WFEA, if actual disability is established. This potential issue has never been directly considered in Wisconsin. In Ray-O-Vac v. ILHR Department, 70 Wis.2d 919, 236 N.W.2d 209 (1975), the Wisconsin Supreme Court held that a plan which provided lesser benefits for pregnancy disabilities than for all other forms of disability violated WFEA. The court said that since the employer had "chosen to include pregnancy-related disabilities within the plan," it was unlawful to treat those disabilities differently from other disabilities without an adequate business justification. 70 Wis.2d at 932, 236 N.W.2d at 215. Accord, Wisconsin Telephone Co. v. ILHR Dept., 68 Wis.2d 345, 228 N.W.2d 649 (1975).

In General Electric Co. v. Gilbert, 429 U.S. 125, 97 S.Ct. 401, 50 L.Ed.2d 343 (1976), the United States Supreme Court held that a plan which excluded pregnancy-related disabilities altogether from its employee disability plan did not, per se, violate Title VII of the Civil Rights Act of 1964, which contains language substantially identical to WFEA. This court was required to consider the very different approaches employed by the two courts in construing the similar acts. In Goodyear Tire & Rubber Co. v. DILHR, 87 Wis.2d 56, 273 N.W.2d 786 (Ct.App.1978), this court analyzed the fundamentally different approaches used by the Wisconsin and United States Supreme Courts in construing the similar acts. Goodyear involved a pay plan which, like that in Ray-O-Vac, covered pregnancy disabilities but provided lesser benefits than for other disabilities. We said:

The distinction between providing lesser benefits and excluding benefits for pregnancy related disability is of no moment. . . . Pregnancy exclusions as well as lesser benefits for pregnancy disabilities are, in our opinion, equally voided under Wisconsin Telephone and Ray-O-Vac because of their effect. 87 Wis.2d at 62, 273 N.W.2d at 790.

Consequently, under this court's view of WFEA as construed by the Wisconsin Supreme Court, the disability pay plan involved in this case unlaw fully discriminates because of sex within the meaning of sec. 111.32(5)(g), Stats., by withholding benefits from pregnancy-disabled employees. The company does not contend otherwise on this appeal.

SUFFICIENCY OF THE EVIDENCE TO ESTABLISH DISABILITY

Section 111.37, Stats., provides that the commission's findings of fact in employment discrimination cases are subject to judicial review under ch. 227, Stats. Section 227.20(6) provides:

If the agency's action depends on any fact found by the agency in a contested case proceeding, the court shall not substitute its judgment for that of the agency as to the weight of the evidence on any disputed finding of fact. The court shall, however, set aside agency action or remand the case to the agency if it finds that the agency's action depends on any finding of fact that is not supported by substantial evidence in the record.

In Copland v. Department of Taxation, 16 Wis.2d 543, 554, 114 N.W.2d 858, 863 (1962), quoted with approval in Holtz & Krause, Inc. v. DNR, 85 Wis.2d 198, 204, 270 N.W.2d 409, 413 (1978), the supreme court defined the scope of the "substantial evidence" test as follows:

"(It) should be construed to confer finality upon an administrative decision on the facts when, upon an examination of the entire record, the evidence, including the inferences therefrom, is found to be such that a reasonable man, acting reasonably, might have reached the decision; but, on the other hand, if a reasonable man, acting reasonably, could not have reached the decision from the evidence and its inferences then the decision is not supported by substantial evidence and it should be set aside." (Quoting E. Blythe Stason, "Substantial Evidence" in Administrative Law, 89 Univ. of Penn.L.Rev. 1026, 1038 (1941); emphasis in original.)

It has also been held that in applying that test on review the court "does not pass on credibility or assay the evidence to determine which view preponderates or what evidence supporting a theory is of the greater weight." Stacy v. Ashland County Dept. of Public Welfare, 39 Wis.2d 595, 603, 159 N.W.2d 630, 634 (1968).

The company contends that there is no evidence to support the commission's finding that the complainant was disabled for any period of time either before or after the birth of her son. Since she testified that she was able to perform housework during those periods, it reasons, the record establishes that she was not disabled from performing the merely clerical duties of her employment. It contends that the finding of disability is further undermined by the fact that the complainant's actual leave of absence coincided exactly with the preplanned leave requested several weeks in advance of her departure. We find the company's arguments unpersuasive.

The complainant testified that during the ten days between the commencement of her leave and the date of delivery she stayed at home. She saw her doctor regularly and experienced no complications with her pregnancy. She stated that her doctor had told her she could work "as long as I felt comfortable...