MICHAEL A STERN, Complainant
RF TECHNOLOGIES INC, Respondent
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, except that it makes the following modifications:
1. In the fifth paragraph of the administrative law judge's ORDER the amount "$20,391.43" is deleted and the amount "$19,641.43" is substituted therefor.
2. The following paragraph is inserted after paragraph five of the administrative law judge's ORDER:
"The respondent shall pay to the complainant reasonable attorney fees and costs associated with replying to the respondent's petition for commission review in the amount of $1,725.00. A check in that amount shall be made payable jointly to the complainant and Attorney Bradley S. Stern and delivered to Attorney Stern."
3. Paragraph six of the administrative law judge's ORDER is deleted and the following paragraph is substituted therefor:
"Within 30 days of the expiration of time within which an appeal may be taken herein, the respondent shall submit a compliance report detailing the specific action taken to comply with the commission's decision. The compliance report shall be directed to the attention of Kendra DePrey, Labor and Industry Review Commission, P.O. Box 8126, Madison, Wisconsin 53708. The statutes provide that every day during which an employer fails to observe and comply with any order of the commission shall constitute a separate and distinct violation of the order and that, for each such violation, the employer shall forfeit not less than $10 nor more than $100 for each offense. See Wis. Stat. § § 111.395, 103.005(11) and (12)."
4. The administrative law judge's ORDER is renumbered accordingly.
The decision of the administrative law judge (copy attached), as modified, is affirmed.
Dated and mailed February 6, 2004
sternmi . rmd : 164 : 9
/s/ David B. Falstad, Chairman
/s/ James T. Flynn, Commissioner
/s/ Robert Glaser, Commissioner
Disputed Findings of Fact
In the brief in support of its petition for commission review the respondent points out four factual findings made by the administrative law judge which it claims are erroneous or lack evidentiary support. The respondent's quarrels with the administrative law judge's findings of fact are without merit. First, the respondent claims that the administrative law judge's finding that the complainant worked in the hospital division only four weeks (1) is contrary to the evidence and that, in fact, he was there six weeks. However, while the respondent correctly identifies those portions of the testimony which suggest that the complainant was in the hospital division six weeks, it ignores that evidence which indicates otherwise. The complainant's supervisor, Stanley Dziewa, testified that the complainant started in the division in September of 2001, and it is undisputed that the complainant's discharge date was October 8, 2001. (T. 39, 128, 299.) While it is possible that the complainant began working in the hospital division during the first three days of September -- in which case he would have been in the hospital division about five weeks at the time of his discharge -- the administrative law judge's finding that the complainant worked in the hospital division for about four weeks appears to be accurate.
Next, the respondent maintains that the administrative law judge erroneously found that the complainant needed training in the operation of the hospital division's infant security system upon his reassignment. The respondent again asserts that this finding is contrary to the evidence. The respondent's argument fails where the complainant's supervisor specifically testified that new sales representatives were trained on the computerized system and that the complainant received such training. (T. 43.)
The respondent next argues that the administrative law judge's finding that Mr. Dziewa testified the complainant was on track to sell $5 million in the future was erroneous and that the record reflects no such testimony. However, the transcript reveals that Mr. Dziewa specifically testified that the complainant had an opportunity to do about $5 million in sales and that he felt the complainant was on track of accomplishing that goal. (T. 44.)
Finally, the respondent takes issue with the administrative law judge's finding that Mr. Dziewa was generally satisfied with the complainant's performance. The respondent claims this finding overstates Mr. Dziewa's testimony that the complainant performed "average" for a new employee. Again, the respondent's argument demonstrates a selective reading of the transcript. While Mr. Dziewa did state that the complainant performed "average" for a new employee, he also stated that the complainant's sales performance was acceptable based upon how long he had been in the division, and that he never had any complaints from customers about the complainant's performance nor reprimanded the complainant for any misconduct. (T. 46, 50-51.) When asked by the complainant's attorney whether he was dissatisfied with the complainant's performance, Mr. Dziewa agreed this was not the case. (T. 70.) Based on the foregoing, it is reasonable to infer that Mr. Dziewa was generally satisfied with the complainant's performance.
Arguments on the Merits
In its brief the respondent argues strenuously that the complainant did not establish a prima facie case because he did not prove that similarly situated younger employees were treated more favorably. The respondent asserts that this is a fatal deficiency which makes further analysis of the case unnecessary. However, as the respondent acknowledges in the very next sentence of its brief, it is not necessary to evaluate the individual elements of the complainant's prima facie case where the respondent produced evidence of a legitimate, non-discriminatory reason for its treatment of the complainant. Indeed, it is a well established principal that, if an employer articulates a legitimate non-discriminatory reason for a discharge or other employment action, the issue of whether the complainant has established a prima facie case becomes moot. Instead, once such a reason is articulated, the burden of proof reverts to the complainant to show that this reason is a pretext for discrimination. U.S. Postal Service Board of Governors v. Aikens, 460 U.S. 711, 715, 31 FEP 609, 611 (1983); Naill v. Western Wisconsin Technical College (LIRC, 02/12/99); Kurtz v. School Dist. of St. Croix Falls (LIRC, June 10, 1993); Duarte-Vestar v. Goodwill Industries (LIRC, Nov. 9, 1990); Mouncil v. Pepsi Cola (LIRC, Feb. 16, 1989).
Next, the respondent argues that the complainant failed to demonstrate that the reasons given for his layoff were a pretext for discrimination. The respondent contends that the complainant was identified as one of ten employees whose positions could be eliminated with a minimal impact on the respondent's immediate operations. It maintains that the other sales managers had significantly greater sales and, although they were performing below their sales goals, had developed more extensive contacts in the territories in which they were operating such that discharging one of them would have had a more significant impact on the respondent's immediate operations. The respondent contends that, in contrast, the complainant was an expendable employee. It maintains that, in concluding otherwise, the administrative law judge improperly substituted her judgment for the respondent's with regard to the manner in which the complainant should have been ranked. The commission has considered this argument, but finds it unpersuasive. The respondent is entitled to base its discharge decisions on the productivity of its employees at a given moment in time, without regard to past performance or future likelihood of success, provided it does not rely on discriminatory factors, and the fact finder's personal belief that the respondent should have taken other factors into consideration is not reason enough to find against it. However, a finder of fact could reasonably conclude, in view of statements by the respondent's managers suggesting the respondent was motivated to discharge the complainant because of his age, that the respondent deliberately failed to take into account those mitigating factors which would have explained the complainant's "C" rating and might have otherwise led it to decide that he should nonetheless be retained. Indeed, the evidence reveals that the respondent did question the "B" rating received by another salesman, who was not in the protected age group and about whom no discriminatory statements had been made, and that it took into consideration the circumstances explaining his failure to meet sales goals. The evidence supports a conclusion that the respondent deliberately failed to consider the validity of the complainant's "C" rating because it felt he was too old for the job.
As the above suggests, this case turns on the testimony of the complainant's supervisor, Mr. Dziewa, who indicated that two of the three managers involved in the discharge decision had made negative comments about the complainant's age. In its brief the respondent attempts to minimize this testimony by arguing that it lacks credibility and, further, that even if such sentiments were uttered, they were stray remarks and not connected to the discharge decision. The commission does not find these arguments persuasive. The administrative law judge, who was present at the hearing and was able to observe firsthand the demeanor of the witnesses, found Mr. Dziewa to be a credible witness, and the commission sees no compelling reason to disagree. Although Mr. Dziewa is no longer employed by the respondent, the commission finds no reason to question his impartiality in this matter. Moreover, in his testimony regarding his conversation with Glenn Jonas, the owner of the company, Mr. Dziewa mentioned that Mr. Jonas made positive remarks about the complainant's sales record, but indicated that he was concerned the complainant was too old to be able to accept the new computer- based technology that was being used in Mr. Dziewa's division. The fact that Mr. Dziewa emphasized the positive comments about the complainant tends to lend credibility to his testimony, and the commission finds Mr. Dziewa's testimony to be balanced and credible overall.
In its brief the respondent points out that, while Mr. Jonas did not appear at the hearing to rebut Mr. Dziewa's testimony about his statements, Mr. Bois did appear at the hearing and denied having made the comments in question. However, it would have been unusual for Mr. Bois to have admitted to making an inherently discriminatory remark, and the commission finds his denial less persuasive than Mr. Dziewa's testimony that the remarks were made.
The respondent also argues that Dri-Tec was a computer-based system, yet Mr. Jonas wanted to hire the complainant for Dri-Tec and actively talked him out of leaving the company in order to work for the Dri-Tec division. The respondent additionally points out that the complainant's supervisor at Dri-Tec, James Huff, testified that in his discussions with Mr. Jonas, Mr. Jonas never expressed doubts about the complainant's ability to learn the computer system and that he believed Mr. Jonas thought the complainant could handle Dri-Tec. However, Mr. Jonas did not appear at the hearing to testify as to whether or not he believed the complainant could handle the computer system in the hospital division, and the fact that he may have felt the complainant was capable of handling Dri-Tec, prior to the complainant's employment in the Dri-Tec division, does not suggest that he had no subsequent doubts about the complainant's ability to learn a different system. The respondent also points out that Mr. Jonas was older than the complainant and that Mr. Bois was only a few years younger, making it less likely that they would doubt the complainant's abilities based upon his age. However, the commission does not find this argument persuasive. While the fact that two of the decision-makers were similar in age to the complainant might suggest that they would not prejudge his capabilities based upon his age, it is certainly not a truism that employers do not discriminate against individuals in the same protected class, and the credible evidence in this case indicates otherwise.
The respondent also takes issue with Mr. Dziewa's testimony that Terry Mammel, the vice president of administration, mentioned the complainant's discharge would be grouped in the same time frame as the company reorganization to help better ease the litigation liability of that termination. The respondent contends that this testimony is incredible because it would have required the respondent to anticipate that the complainant would receive a "C" ranking so that it could group him in with the larger lay-off. However, the commission sees no reason to doubt the credibility of Mr. Dziewa's testimony on this point. Mr. Dziewa's other testimony suggests that the respondent wanted to discharge the complainant, and even assuming it could not have anticipated the "C" ranking, the fact remains that that ranking provided it with an opportunity to do so. Mr. Mammel acknowledged that he considered whether the lay-off list raised questions of age discrimination, and it is clear that the respondent was cognizant of the need to ensure that the complainant's discharge raised no red flags. Under all the circumstances, it is certainly plausible that the respondent would have chosen to time the complainant's discharge with a larger lay-off in order to conceal the fact of age discrimination.
Having decided that Mr. Dziewa's testimony was credible, the commission next addresses the respondent's argument that the comments in question can be dismissed as mere "stray" remarks, unrelated to the complainant's ability to retain his employment. The commission disagrees with this premise. The comments at issue were remarks made by the decision-makers that went directly to the question of whether the complainant would be able to succeed in the job and whether he should still be working for the respondent. Moreover, the remarks were made only a month prior to the complainant's discharge and, as such, would appear to reflect Mr. Bois' and Mr. Jonas' current thinking on the subject of the complainant's abilities. Given these circumstances, the commission concludes that the discriminatory remarks were directly related to the respondent's decision to discharge the complainant.
In support of its argument that the discriminatory remarks, if made, were unrelated to the discharge, the respondent points out that Mr. Dziewa testified the comments had no impact on his rating of the complainant. However, the commission does not believe this factor has any bearing on the outcome of the case. Even if it were to conclude that Mr. Dziewa's "C" rating of the complainant was independent of his managers' negative comments, a matter which the administrative law judge found not to be credible, the fact remains that it was not Mr. Dziewa who made the decision to discharge the complainant, but Mr. Bois, Mr. Jonas and Mr. Mammel, two of whom had commented unfavorably about the complainant's age and suitability for the job. Under all of the facts and circumstances, the commission believes that the discriminatory remarks made by the respondent's managers were relevant to the decision to discharge the complainant, and that the non-discriminatory rationale offered by the respondent to explain its actions was a pretext for discrimination against the complainant based upon his age.
The respondent questions the amount of backpay awarded. The administrative law judge's backpay award is based on the assumption that the complainant would have earned $100,000 per year -- a $75,000 salary, plus a $25,000 incentive bonus -- in 2001 and 2002. The respondent argues, as it did at the hearing, that it was understood the complainant's compensation would change after his second year in the Dri-Tec division and that the complainant would not have received his $25,000 bonus after leaving Dri-Tec. The respondent maintains that, because the complainant was transferred out of Dri-Tec after only nine months, he was not eligible for the bonus in the second year, at which point he would have been in a different division. It, therefore, suggests that the backpay award should be reduced accordingly.
The parties evidently did not discuss what the complainant's salary would be when he was transferred out of the Dri-Tec division and, while the respondent may have planned to eliminate the bonus, it did not expressly tell the complainant that this was the case, and the complainant proceeded under the assumption that his $25,000 bonus would continue for two years as planned. Moreover, the respondent did not introduce any evidence at the hearing with regard to the complainant's 2002 salary, and although during its cross-examination of the complainant it attempted to call into question his assumptions about his salary, it did not present any testimony or documentary evidence of its own on this point. Given these circumstances, the commission believes a conclusion that the existing contract was ongoing is the most reasonable one based on the evidence.
The commission also notes that the reason the complainant received the incentive bonus was because Dri-Tec was a brand new product and he was not expected to make many sales. Thus, the sales incentive for Dri-Tec was meant to replace the bonus or commission the complainant would have earned working with a more established product. If the complainant were not awarded the sales incentive this would not necessarily serve to reduce his backpay, since his make-whole remedy might then encompass the sales commission or bonus he would have been able to earn based upon his sales in the hospital division.
Finally, the respondent challenges two aspects of the attorney fee award. (2) First, the respondent argues for reduction of the fees awarded for reviewing discovery requests. The respondent maintains that the complainant's attorney reviewed discovery responses and discussed them with the complainant for two hours on November 4, 2002, then spent an additional eight hours reviewing discovery responses on December 2 and 4. The respondent contends that the additional eight hours should be excluded, since no new discovery was served until December 11 and because the complainant's attorney has not explained why he needed to spend an additional eight hours reviewing the same responses.
The respondent's argument is a compelling one. The respondent served the complainant with seven pages of responses to requests to admit or deny on November 4, but did not serve any further discovery material prior to December 11. Consequently, although the December 4 entry states, "Review of further RFT discovery," it appears that the complainant's attorney was actually re-reviewing the documents provided on November 4 on the two subsequent occasions identified by the respondent. If, in fact, the complainant's attorney was reviewing other documents of which the commission is unaware, he could have availed himself of the opportunity to explain this when he submitted his responsive brief to the commission. He has not done so, and the commission sees no other explanation for the fee entry than that offered by the respondent.
Having first concluded that the complainant's attorney fee request includes a total of ten hours spent reviewing responses to requests to admit or deny, the commission must agree with the respondent that this was an excessive amount of time to have expended reviewing seven pages of discovery material. The complainant's attorney's records indicate that it took him five hours to draft the requests to admit or deny, and while that is not necessarily a measure of how long it should have reasonably taken him to review the responses, it does seem unlikely that it would take longer to read responses than it took to draft the questions in the first place. Moreover, while there might be a plausible explanation as to why ten hours was necessary, the complainant's attorney has failed to offer one. The commission concludes that five hours would have been sufficient for the careful review of the discovery materials in question, and it has reduced the attorney fee award accordingly.
The respondent also contends that the complainant's attorney spent 35.5 hours reviewing the transcript and preparing his post-hearing brief, which was twenty- two pages in length and contained "virtually no legal citation." The respondent contends that this fee request is excessive and suggests that a more appropriate amount of time would be 18.25 hours. However, the administrative law judge considered the same argument and concluded that the fee request was not excessive, and the commission sees no compelling reason to disagree. Although the complainant's brief did not contain many legal citations, it did contain numerous citations to the transcript, and the commission declines to find that the amount of time billed for preparation of the brief was excessive.
Finally, the complainant has requested a total of $1,725, representing 11.5 hours of work, in conjunction with responding to the respondent's petition and brief. The commission believes this request is reasonable, and although the respondent has filed a responsive brief, it has not challenged it. The commission, therefore, has modified the administrative law judge's decision to include an additional $1,725 in attorney fees reasonably incurred in conjunction with the proceedings before the commission.
Attorney Bradley S. Stern
Attorney Jane C. Schlicht
Appealed to Circuit Court. Affirmed November 29, 2004.
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(1)( Back ) The actual finding is that the complainant only worked in the hospital division for "about four weeks." (See para. 15.)
(2)( Back ) The commission notes that, in its responsive brief, the complainant's attorney argues for reversal of that portion of the administrative law judge's decision denying him fees in conjunction with certain depositions. However, if the complainant wished to challenge that aspect of the administrative law judge's decision, his recourse was to file his own petition. While the filing of a petition for review by any party vests the commission with jurisdiction to review the entire decision, the commission generally does not exercise that jurisdiction to address issues that are neither expressly nor implicitly raised by a petition for review. Dude v. Thompson (LIRC, Nov. 16, 1990).