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Employer need not reassign disabled employee without requiring her to apply like everyone else

By Lorene D. Park, J.D.

While the Eleventh Circuit agreed with a lower court that the ADA did not require a hospital to reassign a nurse to a new unit without any competition for the job and that giving her 30 days to find a new position was reasonable, the lower court erred in granting the EEOC’s motion to alter the judgment because the agency raised a new argument. Rule 59(e) was not to be used that way except in “rare circumstances,” much less where the EEOC was seeking to contravene language that it had itself proposed to include in the jury instructions and verdict form. The case was reversed in part and remanded with instructions to enter judgment for the hospital (EEOC v. St. Joseph’s Hospital, Inc., December 7, 2016, Huck, P.).

The employee worked as a nurse on a hospital psychiatric ward from 1990 through November 2011. In 2002, she started having back pain and was diagnosed with spinal stenosis and arthritis. She had hip replacement surgery in 2009 and began to use a cane to alleviate her back pain. During the course of a disciplinary action (not at issue here), the director of behavioral health observed her using the cane in October 2011 and was concerned that patients could use it as a weapon. The nurse then provided a doctor’s note recommending use of the cane.

Termination. The employee was told she could not use the cane on the psychiatric ward because it was a safety risk. She was offered the chance to stay with the hospital and was given 30 days to apply for other jobs. Normally the hospital did not allow internal candidates to apply if, like the employee, they were subject to a disciplinary write-up and had not been in their current position for six months (she had recently been demoted). However, the hospital waived the requirements and let her compete with other internal candidates. She informed team resources that she was going on vacation for two weeks at the start of the 30-day period and would look at the job board when she returned. Starting three weeks into her allotted time, the employee applied for seven positions out of over 700 posted. She was not hired.

Three jobs. In the EEOC’s ADA suit on her behalf, the employee testified that she had only worked on psychiatric and chemical dependency units, so she could not safely work in medical or surgical units. At trial, the EEOC focused on three jobs for which she applied. The hiring manager for the educational specialist position believed she was not a “good fit” because she lacked medical and education experience. As for a home health clinician job, the hospital had already hired someone else when she applied, but even had the position been open the hospital opined that the employee was not the best qualified. The third position, as care transition coordinator, required coordinating post-hospital care with physician offices. The hospital asserted that the job was not open and that the employee lacked required surgical experience.

Proceedings below. Granting summary judgment in part, the court found that the hospital was reasonable in not allowing the employee to use her cane in the psychiatric ward. However, there was a genuine issue of fact on whether it should have accommodated the employee by reassigning her to either the educational specialist or care transition coordinator positions. The parties did not discuss and the court did not rule on the home health clinician position at summary judgment, but at trial the court allowed evidence on the position.

When the EEOC later asked for clarification on the summary judgment ruling, the court explained that the ADA does not require the hospital to reassign the employee to vacant positions without competition, but the jury could consider being required to compete when considering the reasonableness of the accommodation. It also found that the 30-day period was reasonable as a matter of law.

Verdict. Notably, both the EEOC’s and the hospital’s proposed verdict forms required the jury to cease deliberations on finding that the hospital made good faith efforts to accommodate the employee. The court accepted the parties’ proposed language. The jury answered “yes” in finding that the hospital failed to provide a reasonable accommodation and answered “yes” to the second question finding that the hospital made good faith efforts to identify and make a reasonable accommodation. It then ceased deliberations as instructed on the verdict form.

Rule 59(e) motion. The court entered judgment for the hospital and the EEOC filed a motion for alteration of the judgment and renewed motion for judgment as a matter of law, arguing that the jury’s good faith finding applied only as a defense to compensatory and punitive damages, not as a defense to liability. The court granted in part the EEOC’s motion to alter the judgment, finding that good faith was a defense only to damages, not liability. It denied back and front pay, finding that the employee did not make a good faith effort to secure a position during the 30-day period, and ordered the parties to mediate her reinstatement.

ADA doesn’t require reassignment without competition. Affirming in part, the Eleventh Circuit agreed that the employee’s gait dysfunction was a “disability” under the ADA and that whether she was “qualified” was to be measured with respect to the positions for which she applied (not her psych ward position) because she was seeking reassignment.

The court also affirmed that the ADA does not mandate reassignment without competition. For support, the court cited the Supreme Court’s ruling, in U.S. Airways, Inc. v. Barnett, that the ADA did not require an employer to assign a disabled employee to a particular position even though a different employee was entitled to that job under a seniority system. Here, the issue wasn’t a seniority system but the hospital did have a “best-qualified applicant policy” and undermining that would impose substantial costs on the hospital and potentially on patients. The appeals court therefore concluded that “the ADA only requires an employer allow a disabled person to compete equally with the rest of the world for a vacant position.”

Giving 30 days to find new job was reasonable. The district court was also correct in finding reasonable, as a matter of law, the hospital’s 30-day period for the employee to identify and apply for a vacant position. The appeals court noted that the hospital also told her that the time would be extended for any position for which she was being considered and it did not prohibit her from continuing to apply for positions after her termination.

Jury’s verdict reasonable in view of the evidence. The Eleventh Circuit next reviewed the record and concluded that it supported the jury verdict that the hospital failed to reasonably accommodate the employee by reassigning her to one of the three positions at issue. Though the hospital claimed two were not really vacant, there was evidence that the hiring manager interviewed another applicant to be a care transition coordinator and the position remained posted until May 2012. As for the second, there were postings for identical home health clinician positions. Moreover, while the hospital contended that the employee was not the most qualified to be an educational specialist, the jury could have concluded that she was qualified enough.

That said, there was evidence at trial that the hospital waived a prohibition against allowing the employee to apply for internal transfers due to her disciplinary write-up and recent demotion. The hospital also assigned a team resources professional to assist the employee in applying for other jobs and gave her 30 days to do so. A rational trier of fact reviewing that evidence could reasonably conclude that the hospital acted in good faith although it failed to accommodate the employee. Accordingly, the verdict was reasonable and the district court correctly denied the motion for judgment as a matter of law.

EEOC’s Rule 59(e) motion should have been denied. While the district court agreed with the EEOC that the good faith defense applied only to jury-awarded compensatory and punitive damages, but did not absolve the hospital of all liability, the appeals court found that the record supported the hospital’s position that the parties had proceeded as if a good faith finding would absolve it of all liability. Indeed, the EEOC’s own proposed jury instructions and verdict form, read together, treated good faith as a complete defense to liability. The verdict form unequivocally did so by instructing jurors to end their deliberations if they found that the hospital “made good faith efforts to identify and make a reasonable accommodation.”

Moreover, it was only after the district court entered judgment that the EEOC first raised the issue. Motions under Rule 59(e) may not be used to raise new legal theories and arguments, explained the appeals court, much less ones that contradict verdict forms or instructions that the moving party proposed to the district court. The district court was therefore reversed in part with instructions to enter judgment in favor of the hospital.