STATE OF WISCONSIN
LABOR AND INDUSTRY REVIEW COMMISSION
P O BOX 8126, MADISON, WI 53708-8126 (608/266-9850)

KOI  LATHROP, Complainant

MICHAEL LATHROP, Complainant

PRECAST CONCRETE SPECIALTIES INC, Respondent

FAIR EMPLOYMENT DECISION
ERD Case No. 199703026, EEOC Case No. 26G971727

An administrative law judge (ALJ) for the Equal Rights Division of the Department of Workforce Development issued a decision in this matter. A timely petition for review was filed.

The commission has considered the petition and the positions of the parties, and it has reviewed the evidence submitted to the ALJ. Based on its review, the commission agrees with the decision of the ALJ, and it adopts the findings and conclusion in that decision as its own.

DECISION

The decision of the administrative law judge (copy attached) is affirmed.

Dated and mailed May 24, 1999
lathrko.rsd : 125 : 9

/s/ David B. Falstad, Chairman

/s/ Pamela I. Anderson, Commissioner

/s/ James A. Rutkowski, Commissioner

MEMORANDUM OPINION

Koi and Michael Lathrop alleged that the respondent refused to hire them to work on its patch crew during the 1997 work season because of their race. Michael and Koi are father and son. Michael is three-sixteenths American Indian and part German, Scotch and French. Koi is one-half Hispanic and part American Indian, German, Scotch, French and English. Michael has worked for about 20 years as a cement mason, and has been a journeyman cement mason for 17 years. Michael worked on one of the respondent's patch crews during the 1995 and 1996 seasons. Koi, who had no prior experience working with cement, worked on the patch crew with his father during the 1996 season. The ALJ found that race was not a factor in the Lathrop's failure to be rehired for the 1997 season, that the Lathrop's were not hired because only four patch crew employes were needed and because John L. Schroeder, the respondent's president, while he did not find the Lathrop's work unacceptable, believed, based on his observations, that the Lathrop's work was not quite as good as the four employes rehired and that they did not work as well without on-site supervision.

At the center of the Lathrop's discrimination claim is the contention that Schroeder made direct reference to their race as reason for their nonhire. Michael Lathrop claimed that Schroeder responded, "I'm tired of the way you Indians and Spicks do things" during a telephone conversation when he asked Schroeder why he and his son would not be hired for the 1997 season. Koi claimed that when he called and inquired why he was not hired Schroeder responded, "I am sick of the way you Mexicans do things." Schroeder denied making the racial comments attributed to him by the Lathrops. The ALJ found that Schroeder had simply told the Lathrops that he did not want to discuss why they were not being rehired. The commission consulted the ALJ regarding her impressions of the witnesses' credibility and demeanor since her decision did not contain a discussion of witness credibility and demeanor. In the consultation the ALJ stated that she did not find the complainants' assertions about the comments alleged to have been made by Schroeder to be credible, that she found it hard to believe that Schroeder was this type of individual. The ALJ noted, as reason, for instance, that Schroeder has Hispanic relatives with whom he spends time on a regular basis, that Schroeder had worked with Michael Lathrop for two years and had known that Michael was part Indian (and Koi part Indian and Hispanic) from the beginning, and also because during the 1995 season Schroeder had employed another Hispanic individual, Cornelia Ortega, and there was no evidence that Schroeder had made any discriminatory comments to Ortega.

As further reason for disbelieving the complainants, the ALJ stated that she observed that Michael Lathrop was extremely uncomfortable and very, very nervous when testifying, while Koi did not come across as a truthful individual because he expressed no discomfort in having lied about who he was when he sought to speak to Schroeder and having lied about who he was in order to obtain records from the telephone company. The ALJ noted that Koi, in fact, seemed proud of having lied on these occasions. The ALJ also noted Koi's failure to mention the comment Schroeder had allegedly made to him in his own discrimination complaint as reason for not finding Koi credible. Additionally, the ALJ was influenced by the testimony of Mary Coats, Connie Buhrow and Mary Jo Hinderman who were in the presence of Schroeder during his conversation with Koi. All three witnesses denied hearing Schroeder make any comments of a discriminatory nature. The ALJ stated that these witnesses appeared comfortable when testifying, appeared not to be under any duress and that she found them to be very credible witnesses. In contrast, the ALJ was not persuaded by the testimony of the complainant's witness, Randal Clark. Clark maintained that he had heard Schroeder make discriminatory comments about the Chinese and blacks. The ALJ was not persuaded by Clark's testimony because he was a close friend of Michael Lathrop that had been fired by Schroeder. Finally, the ALJ observed that Schroeder appeared angry at times, however she could not fault Schroeder for this in view of the allegations being made by the Lathrops which she found to be not credible.

The commission realizes that it is seldom easy to resolve a case with such conflicting testimony by the witnesses. However, the ALJ, who could observe the demeanor of the witnesses and therefore was in a good position to make a determination as to credibility, did not credit the complainants' testimony. The commission has found no compelling reason in the testimony to question the ALJ's credibility determination. Therefore it will defer to the judgment of the ALJ as to credibility.

The complainants argue that even if it is determined that Schroeder did not make the discriminatory statements, they have established a case of race discrimination under the McDonnell Douglas burden-shifting analysis. Under this analysis, the complainants have the initial burden of establishing a prima facie case of disparate treatment. They must prove by a preponderance of the evidence that they applied for an available position, for which they were qualified, but were rejected under circumstances which give rise to an inference of unlawful discrimination. Texas Department of Community Affairs v. Burdine, 450 U.S. 248, 25 FEP Cases 113 (1981). If the complainants succeed in proving a prima facie case, the burden shifts to the employer to articulate some legitimate, nondiscriminatory reason for the complainants' rejection. Burdine, citing McDonnell Douglas Corp. v. Green, 411 U.S. 792, 5 FEP Cases 965 (1973). Finally, should the employer carry this burden, the complainants must then have an opportunity to prove by a preponderance of the evidence that the legitimate reasons offered by the employer were not its true reasons, but were a pretext for discrimination. Id.

The complainants apparently maintain that they established a prima facie case of discrimination by showing that they are members of a protected class, that they were qualified as they had satisfied the normal requirements of the job and that they were discharged (i.e., not rehired). Assuming for purposes of argument that the complainants have established a prima facie case of discrimination, the respondent's articulated reasons for the complainants' nonhire was that a downturn in the business resulted in a need for fewer workers, and, although not dissatisfied with the quality of the Lathrop's work, Schroeder believed based upon his observations that the 4 other workers employed during the 1996 season were doing a better job and seemed to work better without guidance. The complainants contend that the respondent's asserted reasons for their nonhire are merely a pretext for discrimination. They assert, for example, that Schroeder has stated that the reason for their termination was because "I am sick of the way you Indians and Spicks do things," which alone shows that the reasons given by the respondent are pretextual. However, the assertion that Schroeder made this statement has not been found to be credible. The complainants have further asserted that Schroeder did not tell the Lathrops there was a downturn in business, and that the downturn in business argument is flawed because the documents it submitted to support evidence of the downturn in business were not even in existence at the time the employment decision was made. These arguments also fail to establish that the respondent's stated reason was a pretext for discrimination. Schroeder did not tell the complainants there was a downturn in business because he was concerned everyone would learn the respondent was having financial difficulties. The only document submitted at the hearing that was not in existence at the time Schroeder made his decision was Exhibit 21. However, Schroeder had the information contained in Exhibit 21 in another format at the time of his employment decision. The reason for the existence of Exhibit 21 was that Schroeder had been asked by the complainant's counsel to prepare it at Schroeder's deposition.

The complainants also maintain that the respondent's assertion that the other workers were better is simply a pretext because it was not shown that the Lathrops were informed that their work was not satisfactory, because Michael Lathrop had over 20 years experience as a journeyman cement mason and because Michael had recommended individuals for hire and trained most of the respondent's patch crew workers. These arguments also fail. Prior to the 1997 season Schroeder had not been overly concerned that the Lathrops' work was unsatisfactory. However, when the downturn in business occurred resulting in a need for only 4 workers Schroeder had to make a choice. Schroeder believed the other workers did a better job and worked better with less guidance. Schroeder's testimony is credible. There was some evidence that Michael Lathrop had done some training. However, in terms of Michael's employment at the respondent, it appears that this training was pretty much limited to his son, Koi, and one other individual, Terry Arfsen. Other than Koi and Arfsen, Michael simply stated that he had "somewhat helped" Terry Riban and that he had trained Mitch Molter some 10 years earlier when Molter was a laborer with another company for whom they were working. Molter had become a journeyman bricklayer by the time of his employment with the respondent in 1996. Riban was a cement mason. Both were recalled for the 1997 season. Finally, with respect to Michael recommending individuals for hire, the evidence showed that patch workers were hard to obtain and that most of the respondent's hires were by way of referral.

Based upon the reasons stated above, the commission agrees with the ALJ's determination that the complainants' race was not a factor in the respondent's decision not to rehire them as patch crew workers in 1997.

cc: Scott L. Schroeder
Daniel M. Muza

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