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Constructive discharge limitations period: A ‘matter’ of definition to Supreme Court

By Joy P. Waltemath, J.D.

When does the filing period for a constructive discharge claim under Title VII begin to run—at the employee’s resignation, or when the last discriminatory act giving rise to the resignation takes place? The Supreme Court heard oral argument on this question in Green v. Brennan, Dkt No. 14-613, on November 30.

Limitations period. According to the long-time postal employee’s petition, the “federal courts of appeals are intractably divided” over when employees must initiate proceedings alleging constructive discharge under Title VII. The First, Second, Fourth, Eighth, and Ninth Circuit Courts of Appeal have held that the filing period for a constructive discharge claim begins when the employee resigns. On the other hand, the District of Columbia and the Seventh and Tenth Circuits have rejected the majority rule and “pegg[ed] the running of the filing period to ‘some discriminatory act by the employer within the limitations period.’”

The petition also points to the federal government’s own conflicting positions on the limitations period question: The EEOC’s position is consistent with the majority rule, while the Postal Service, represented below by the DOJ, pressed for the minority’s last-act rule.

Decision below. The employee filed an EEO complaint of race bias after the Postal Service passed him over for a promotion. Although a settlement was reached, the employee later brought an informal EEO charge of retaliation due to his earlier EEO activity. He was then subject to an investigation, which eventually included OIG allegations of delay of mail, a crime, and he was placed on unpaid leave. To resolve the OIG allegations, the employee entered into a December 2009 settlement agreement that required him to give up his current position and retire. The Tenth Circuit found his claims that the postal service harassed and bullied him into retirement were time-barred, rejecting employee’s contention that the 45-day limitations period did not begin to run until he announced his resignation—which was well after the last allegedly discriminatory act against him.

What is the “matter alleged to be discriminatory?” Right out of the starting gate, Justice Scalia posed a question about the regulation itself, which says the aggrieved party has to bring within 45 days the “matter alleged to be discriminatory.” Is that the cause of action in its entirety, as Brian Wolfman urged, arguing for the petitioner that the “matter” includes both the precipitating conduct (on the part of the employer) and the employee’s resignation itself. Wolfman’s point was that “the limitations period is not triggered until the claim is fully formed”—when the employee actually resigns.

Or is the “matter,” as Scalia suggested, only the act of the employer? “Quitting is not the act of the employer. The act of the employer—the unlawful act of the employer is coercing the quitting,” said Scalia.

This exchange set the tone for much of the remaining argument.

Justices Sotomayor and Kagan quickly added their perspective: “Isn’t a constructive discharge that the moment that the environment has gotten so hostile that you feel overwhelmed and have to leave, isn’t that the discriminatory act as well?” asked Sotomayor.

Kagan echoed that if the regulation included “discriminatory acts” language, that might point to the last predicate discriminatory act as opposed to the resignation. “It might or might not,” she said, “but here that language doesn’t exist. Here the language is ‘discriminatory matter.’ That refers to the entire claim … the resignation is part and parcel of that.”

Too much wiggle room for plaintiffs? The Justices, particularly Ginsberg and Chief Justice Roberts, were concerned about whether this interpretation left an employee with the ability to choose the timing to his or her advantage—as Roberts suggested, “maybe you also need a paycheck—or, you know, you’re going to be eligible for the bonus in six weeks, you may as well at least wait until then.”

Wolfman, who reserved time for rebuttal, stressed the common sense and feasibility of the petitioner’s approach: “Common sense will tell an employee I cannot and certainly need not bring my claim that I was forced out before I was actually forced out.”

Notice of resignation. What about a situation where people set a resignation date at some point in the future? Curtis E. Gannon, arguing for the respondent, agreed with notice of resignation as being the operative date for statute of limitation purposes, not when the employer commits the last act which might or might not lead to that resignation. “It leads to the same result in both cases of actual termination and cases of constructive termination,” he urged.

Gannon also reasoned that this notification of resignation approach would be self-limiting. “It limits the time period between when the employee is able to suffer the consequence of what the employer does to him, and then actually say I can’t take this any more … the employee is going to have to prove that the situation was intolerable.”

Legal fiction of constructive discharge. Delving further into the unique aspects of constructive discharge itself, Gannon also posited that “the new act of discrimination that we think is relevant here is the act of the employee, and it’s the one that it’s called a constructive discharge precisely because it is not actually a discharge. It is instead an act of the employee that is a resignation, but it is treated in law as a legal fiction as if it is a discharge.”

Either way, the court returned to the argument that for constructive discharge, without the actual quitting, there is no cause of action.

When asked about amending a timely complaint concerning the underlying discrimination (and would it have to be independently actionable?) to add a constructive discharge count, Gannon explained that the reason why you have to amend the complaint is “because it’s a new claim. It’s not just evidence that is relevant to damages for the underlying discrimination.”

Effect of settlement agreement. Ginsburg then asked Gannon to explain the difference between his position and petitioner’s. They agreed on the legal question, but with respect to applying the rule to the case itself, “the difference is that we think that the settlement agreement that Petitioner signed on December 16 … manifested unequivocal notice of his intent to resign” (and inferredly, not the date he actually resigned, which was months later).

The Court also entertained an extensive discussion about the settlement agreement itself, what it actually said, and whether it actually gave the employee a choice not to resign, even though it suggested that he did have a choice.

Catherine M.A. Carroll, arguing as Court-appointed amicus in support of the Tenth’s Circuit’s judgment below, stated its view succinctly: “a constructive discharge claim has to challenge actionable conduct by the employer.” She said the case was all about (1) what was the actionable conduct, (2) what was alleged to be discriminatory, and (3) when did it occur.

“Matter” doesn’t matter. When Kagan reiterated the statutory language that a “matter” might be the entire claim, not just the particular discriminatory conduct that’s the predicate for the claim, Carroll replied in essence that “Matter doesn’t matter.” The EEOC said when it promulgated the rule that it was continuing the prior rule. “So inclusion of the word “matter” doesn’t make a difference,” she reasoned.

Back to when the claim is ripe. When Carroll began arguing that the plaintiff here had alleged a discrete act of discrimination—no repeated or cumulative acts—Ginsburg cut her off: “What about that he hasn’t got a claim? You can’t come to court with a claim for constructive discharge until you’ve said I’m discharged. So he—you’re suggesting that the time runs from a time when he does not yet have a ripe claim?”

Justice Kennedy jumped in as well: “Are you saying that constructive discharge will—will lead to a cause of action only when it is so close to the precipitating event that they are almost contemporaneous?”

And so did Justice Breyer, alluding to tort and contract law, who pointed out that “normally the statute of limitations begins to run when the harm occurs. Now why should it be any different here?” he asked.

Making the respondent’s argument, he played out the reasoning that the plaintiff is hurt on the very last day the last employer act was performed. “So let’s count that as the injury.” But, he stressed, “now the argument against you is that’s going to be a nightmare. Because there will be in fact a whole range of acts, a whole series in many cases and … which of those acts actually did produce harm and which did not.”

When Carroll responded that that is no different than a hostile work environment situation, Kagan replied, if somebody is demoted and then fired, “you would never say oh, he was demoted. He suffered the injury then, it [the termination] just raised the stakes. You would say no, there’s two independent things and now he can bring a termination claim.”

One question left hanging during the argument was a return to the idea that constructive discharge was a legal fiction. In essence, the Justices queried whether the Court could recognize the legal fiction of constructive discharge requiring an employee to actually quit as for the claim and not include that element of the claim for statute of limitations purposes?

The Court granted the petition for cert on April 27, 2015.