State of Wisconsin
Labor and Industry
Review Commission
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Fair Employment Decision[1] |
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Complainant
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Respondent
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Dated and Mailed: |
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ERD
Case No. CR20142159 |
September
27, 2018 |
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The decision of the administrative law judge is set aside and rewritten to conform with the following decision and, as rewritten,
is affirmed. Accordingly, the complainant's complaint is
dismissed.
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By the Commission: |
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/s/ |
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Georgia E. Maxwell, Chairperson |
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Laurie R. McCallum, Commissioner |
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David B. Falstad, Commissioner |
Procedural History
On May 27, 2014, the complainant filed a complaint
alleging that he was discriminated against based upon his arrest and conviction
record, in violation of the Wisconsin Fair Employment Act (hereinafter “Act”). The complainant stated that he was a
participant in a work release program operated by the respondent and that the
respondent colluded with a private employer, The Jor–Mac Company (hereinafter
“Jor-Mac”), to pay him less
than similarly situated “civilian” employees. The complainant filed a separate complaint against Jor-Mac, containing essentially
the same allegations.[2]
On September 2, 2014, the respondent filed a
Motion to Dismiss the complaint, on the ground that
the complainant had failed to exhaust administrative remedies prior to filing a
complaint with the Equal Rights Division (hereinafter “Division”). On May 11, 2015, the respondent submitted a second
Motion to Dismiss, this time based upon a lack of jurisdiction.
On January 19, 2016, an Equal Rights Officer for
the Division issued an initial determination finding no probable cause. The initial determination indicated that for
purposes of the determination the Division would assume it had jurisdiction,
but that the facts of the case did not warrant a finding of probable
cause. The complainant filed a timely appeal
and the matter was certified to hearing.
On February 10, 2016, the respondent filed another
Motion to Dismiss for lack of jurisdiction. Subsequently, prior to any action by the administrative law judge with
respect to that motion, the respondent filed a motion to delay the decision pending
the outcome of a similar case that was before the commission: Jackson v. State of Wisconsin-DOC. The administrative law judge granted the
respondent's motion and placed this matter into abeyance pending a decision by the
commission in the Jackson case.
The commission issued its decision in Jackson on November 14, 2016. See, Jackson v. State of WI Dept. of
Corrections, ERD Case No.CR201402452 (LIRC Nov. 14, 2016). In its decision, the commission rejected an argument that
the complainant, an inmate at a correctional institution, needed to exhaust
administrative remedies prior to filing a complaint with the Division, but
concluded that the respondent's actions in removing an inmate from a work-release program were not
covered by the Act. Relying on that
decision, the administrative law judge issued a decision in the instant matter on
June 29, 2017, which found that the Division had no jurisdiction over the complainant's
claim and dismissed the complaint. The
complainant filed a timely petition for commission review of the administrative
law judge's decision.
Subsequent to the events described
above, the Division issued its decision regarding the complaint the complainant
had filed against Jor-Mac.See,
Lofton v. The Jor-Mac Company, Inc., ERD Case No. CR201402160
(ERD May 18, 2017). In its decision, the
Division found that the complainant failed to establish probable cause to
believe that Jor-Mac had discriminated
against him with respect to compensation based upon his arrest and/or conviction
record. The complainant filed a petition
for commission review and, on April 19, 2018, the commission issued a decision adopting
the Division's findings of fact and affirming its decision. The complainant did not file an appeal of
that decision, and it now stands as the final decision in the matter.
On June 26, 2018, the commission invited the
parties to provide statements of position regarding what, if any, preclusive effect
the Jor-Mac
decision had on the instant case. The
parties have done so. Based on the
information before it, and considering the briefs submitted by the parties, the
commission now makes the following:
Conclusions of Law
1.
The Division has jurisdiction over the
complainant's complaint.
2.
The doctrine of issue preclusion bars the
complainant's claim that the respondent discriminated against him with respect
to pay based upon his arrest and conviction record.
Based
upon the Conclusions of Law made above, the commission issues the following:
Order
1.
The complainant's complaint is dismissed with
prejudice.
Memorandum Opinion
Jurisdiction
The
complainant, an inmate at the John C. Burke Correctional Center, alleged that,
while he was participating in a work-release program, the respondent
colluded with a private employer to discriminate against him by paying him less
than other workers based upon his arrest and conviction record. In her decision dismissing the complaint, the
administrative law judge acknowledged that there might be an argument in favor
of finding that the Division has jurisdiction over this matter, but ultimately
concluded that the respondent was not covered by the Act when acting in
connection with a work release program. The commission does not agree with the administrative law judge's
conclusion that the respondent is never covered by the Act when acting in
connection with a work release program, and it believes that, given the nature
of the assertions made in the complaint--that the respondent deliberately
intervened in the terms of an outside employment relationship--there
is a reasonable basis to conclude otherwise.
The Wisconsin Fair Employment Act
(hereinafter “Act”) provides, in relevant part, as follows:
111.322
Discriminatory actions prohibited. Subject to ss. 111.33 to 111.365, it is an act of employment
discrimination to do any of the following:
(1)
To refuse
to hire, employ, admit or license any individual,
to bar or terminate from employment or labor organization membership any individual, or to discriminate against
any individual in promotion, compensation
or in terms, conditions or privileges of employment or labor organization
membership because of any basis enumerated in s. 111.321. (emphasis added).
111.325
Unlawful to discriminate. It is
unlawful for any employer, labor
organization, licensing agency or person
to discriminate against any employee or any applicant for employment or
licensing. (emphasis added).
The commission
has held that the Department of Corrections (hereinafter “DOC”) is subject to
the Act, both as an employer and as a “person.” Monroe v. State of WI DOC,
ERD Case No. CR200304303 (LIRC March 31, 2010). Although it is well settled law that
inmates are not considered to be employees of the DOC, even with respect to
services they perform for pay for the DOC, Whaley
v. DOC (96-0157-PC-ER, 3/12/97), it is also
well settled law that one need not be an employee of an employer or person in
order to bring a claim under the Act. To
the contrary, the Act applies to “individuals.” See, Wis. Stat.
§111.322(1), cited above. Consequently,
the question is not whether the parties are covered under the Act, but whether
the respondent is alleged to have engaged in any conduct that would constitute
a violation of the Act.
Because the respondent in
this case is neither a current nor prospective employer of the complainant's,
nor a union or licensing agency, there is a question as to whether it has the ability to directly engage in any of the enumerated
acts of discrimination laid out in the statute. Arguably, the DOC cannot refuse to hire,
employ, admit or license the complainant, cannot bar or terminate him from
employment or labor organization membership, and cannot discriminate against
him in promotion, compensation or in terms, conditions or privileges of
employment or labor organization membership, all of which could be considered
actions requiring either an actual or potential employment relationship. However, the commission has repeatedly
found that a complaint may be stated under the Act, even in the absence of an
actual or potential employment relationship between the parties, provided the
complainant has alleged that the respondent engaged in an action that directly
relates to an employment opportunity.Maxberry v. Goodwill Industries, ERD
Case No. CR201301901 (LIRC March 19, 2015); Wilde v. UW-Milwaukee, ERD Case No.
CR201403303 (LIRC Feb. 27, 2015); Hinkforth v. Milwaukee Area Technical College,
ERD Case No. CR200103936 (LIRC Feb. 23, 2004), Bledsoe v. Mount Mary College,
ERD Case No. CR200703330 (LIRC April 25, 2008).
Thus, there have been situations in which the
protections of the Act have been extended to cover relationships between
complainants and their former employers, as well as relationships between
complainants and third parties employers, such as
temporary help agencies, who do not directly employ the complainant but who
have the power to affect the terms of an employment relationship. For example, in Jackson v. City of Milwaukee,
ERD Case No. 9230848 (LIRC Oct. 28, 1993), in which the complainant was
employed by the Rucker Detective Agency to perform security guard services for
the Milwaukee Public Library, the commission found jurisdiction under the Act
over the complainant's complaint that the City of Milwaukee discriminated
against him based upon his race and sex, stating:
The
city is a body corporate and politic. Section
66.012(6), Stats. As such it is a “person”
within the meaning of the definition of that term in sec. 990.01(26), Stats. That definition applies to the use of the term
“person” in the FEA, since the term is not separately defined there. Section
990.01, Stats. Jackson is clearly an “individual.” He was also an “employee” in that he was an
employe of Rucker Detective Agency. Thus, the FEA is expressly applicable.
The
city's argument to the contrary, if accepted, would allow a businessman to
sexually harass a temporary help agency employe working in his office, or to
discriminate between such temporary help agency employes in assignments and
other conditions of work simply because of race, or to demand that the
temporary help agency rescind the assignment of a qualified employe of the
agency to his business simply because of the person's age. Considering the declaration of policy
expressed by the Legislature in sec. 111.31, Stats., it is unthinkable that the
Legislature would have adopted a statutory scheme allowing this outcome. Considering the express language of secs.
111.321, 111.322, and 111.325, Stats., it is clear that they
did not. That is why the commission has
consistently construed the coverage of the FEA broadly, holding that a “person”
other than an employer, labor organization or licensing agency can violate the
Act if it engages in discriminatory conduct which has a sufficient nexus with the
denial or restriction of some individual's employment opportunity. . .(emphasis added).
In another case, more factually similar to the one
at hand, Collins v. MATC and Kelly
Services (LIRC Dec. 19, 1986), the commission
concluded that MATC could be found liable for discrimination if it caused a
temporary help agency to terminate the employee's assignment with it for
discriminatory reasons. The commission
explained:
The Commission believes that
even assuming no employment relationship existed between the Complainant and
MATC it should not be permitted to do indirectly through Kelly what it cannot
do directly and to avoid answering for its discriminatory conduct. The argument by MATC ignores the purpose of
the Act and its intended liberal instruction. Moreover, the Act specifically states that “no employer. . . may
engage in any act of employment discrimination as specified in s. 111.322
against any individual on the basis of. . .
arrest record. . .” Wis. Stats. s.
111.321. (emphasis in original).
In Jackson v. State of WI Dept. of Corrections,
ERD Case No. CR201402452 (LIRC Nov. 14, 2016), the case relied upon by
the administrative law judge to find no jurisdiction in the instant matter, the
commission considered the ‘no employment relationship’ cases cited above, but
concluded they did not apply. The
commission began its analysis by noting that the DOC's actions in ending the complainant's
participation in a work release program that would have permitted him to obtain
outside employment with a third party employer did not
fit within the definition of discrimination provided in the Act. The commission stated:
. . . the commission is
unpersuaded that the discriminatory conduct alleged to have occurred in this
case qualifies as an “act of employment discrimination” within the meaning of
Wis. Stat. §§ 111.321 and 111.322. The
complainant has not alleged that the respondent refused to hire, employ, admit
or license him, that it barred or terminated him from employment, or that it
discriminated against him with respect to promotion, compensation, or the terms
and conditions or privileges of employment, the acts of discrimination that are
prohibited under the statute. The
respondent's actions in ending his participation in a prison program that would
have permitted him to obtain outside employment with a third
party employer do not fit within the definition of discrimination
provided in the Act.
The
complainant's allegation of discrimination on the part of the DOC has its
origins in an employment relationship with a private employer,
and is only tangentially connected to his relationship with the
respondent by virtue of the fact that it stems from his participation in a work
release program. Because the respondent
in this case is neither a current nor prospective employer nor a union or
licensing agency, it is unable to engage directly in any of the enumerated acts of
discrimination laid out in the statute. . . .
Having
concluded that the DOC did not directly engage in any of the conduct prohibited
by the Act, the commission then considered whether the complainant had alleged
that the respondent engaged in actions that affected his potential future
employment opportunities or whether the circumstances of his complaint could be
analogized to those of an individual working for a temporary help agency who is
subject to discrimination by the temporary agency with regard to job assignments,
as in Collins v. MATC, cited above. The commission answered those questions in the
negative:
. .
. While the commission recognizes that the Act has been broadly interpreted to
cover actions that may affect employment opportunities taken by employers or
persons with whom the complainant has no current or potential future employment
relationship, decisions taking that approach have involved situations that are
distinguishable from the case at hand. . .
In
the instant case, the complainant does not currently have, and has never
previously had, an employment relationship with the respondent, nor has he
alleged that the respondent caused the complainant's private employer to engage
in acts of discrimination against him. The commission has also considered whether the complainant's
circumstances could be analogized to those of an individual working for a
temporary help agency who is subject to discrimination by the temporary agency
with regard to job assignments, but concludes they
cannot. While the DOC may be responsible
for permitting or disallowing the complainant an opportunity to work in private
employment through his participation in a work release program, the DOC
operates a prison and not a temporary help agency. Unlike a temporary help agency, whose primary
function is to place individual employees in jobs, the DOC's efforts to find
job opportunities for inmates are only ancillary to its broader goal of
fostering public safety. It strains
common sense to find that a prison inmate whose only employment-related
connection to the respondent is due to the fact of his incarceration would be
covered by the Act, and the commission concludes that the complainant's
allegations of discrimination do not fall within the prohibitions of the Act.
Finally,
the commission noted that there are public policy reasons to conclude
that this situation was not covered by the Act:
. .
. Work release programs play a valuable role in the rehabilitation of inmates,
and the commission believes that subjecting the respondent to legal action
under the Fair Employment Act for its implementation of a work release program
could have a chilling effect on the respondent's willingness and ability to
participate in such programs in the future. . .
The facts in Jackson
bear some similarities to those in the instant case, since both cases involve
inmates whose work release privileges, granted through the DOC, allowed them to
work for private third party employers. However, there are meaningful distinctions
between the two cases. While the action
complained of in Jackson was the
DOC's decision to remove the complainant from the work release program
altogether based upon an infraction of DOC rules--a matter of internal prison policy that was completely
separate from the actual terms and conditions of his employment with the third
party employer--in this case the
complainant is claiming that the DOC colluded with the third party employer to
discriminate against him in terms of compensation. This is the type of situation that the
commission emphasized did not exist
in Jackson when it stated, “. . .
the complainant does not currently have, and has never previously had, an
employment relationship with the respondent, nor has he alleged that the respondent caused the complainant's private
employer to engage in acts of discrimination against him,” but is exactly
the situation the complainant is alleging occurred in this case.
In Baker v. McNeil Island Corrections Center,
859 F.2d 124, 48 FEP Cases 143 (9th Cir. 1988), cited approvingly in
Whaley v. DOC, supra, the court
found that an inmate in a work-release program could be covered under
the parallel federal anti-discrimination statute, Title VII.[3] The court stated:
Title
VII protections apply only where there is some connection with an employment
relationship. The connection need not
necessarily be direct. It can encompass
a defendant who is subject to Title VII and who interferes with an individual's
employment opportunities.
The court went on to discuss
an EEOC “Notice of Policy Statement” (Policy statement on work release
programs, N-915, May 1986) which states:
According
to the EEOC's policy once a prison recommends a prisoner for work release, the
prisoner is seeking an employment opportunity with an employer, and the jail
becomes a third party who has the ability to control
or interfere with the inmate's employment opportunities with another employer,
and its activities are covered by the Act.[4]
The commission has been reluctant to expose the
DOC to liability under the WFEA for matters that relate to work release
privileges, as expressed in its decision in Jackson. However, while in Jackson the commission concluded that the respondent's actions were
purely a matter of internal prison policy and sufficiently outside of the third party employment relationship as to warrant excluding
them from coverage under the Act, that distinction does not exist in the instant
case. Had the complainant been able to prove
his allegation that the DOC deliberately intervened in the terms of an outside
employment relationship by colluding with a private employer to discriminate
against him based upon his conviction record, it would be difficult to
articulate any compelling reason why such allegation would not be covered by
the Act.
Upon consideration of all
the facts and circumstances, the commission sets aside and reverses the
administrative law judge's decision finding that the Division does not have jurisdiction over this
claim.
Issue Preclusion
Having
found that the Division and commission have jurisdiction over this matter, the
commission next turns to the question of whether the doctrine of issue
preclusion bars the complainant's claim that the respondent discriminated
against him with respect to pay based upon his arrest and conviction record.
Issue
preclusion is a legal doctrine that, in the interest of equity and judicial
economy, prevents
the relitigation of issues of law or fact that have
actually been litigated in a prior action.[5] The first step in an issue preclusion analysis
is to determine whether the issue or fact was actually litigated and determined
in the prior proceeding by a valid judgment in a previous action and whether
the determination was essential to the judgment.Aldrich v. LIRC
and Best Buy, 2012 WI 53, ¶97, 341
Wis.2d 36, 814 N.W.2d 433. Resolving the question of whether the issue or fact was actually
litigated and determined requires comparing the specific factual issues addressed
in the previous action and in the action which is
sought to be precluded.Banty v. Dings Co. Magnetic Group, ERD
Case No. CR200803382 (LIRC July 31, 2012).
The allegation made in the
instant complaint, that the respondent colluded with Jor-Mac to pay the complainant
less than other workers based on his arrest and conviction record--the critical issue in this
case--was addressed in the Jor-Mac
decision, in which the administrative law judge found that the complainant
produced no substantive evidence that his wage was less than that paid to comparable
“civilian” workers and concluded that the complainant had not established
probable cause to believe that Jor-Mac discriminated against him in compensation. In its decision affirming the administrative
law judge's decision, Lofton v. The Jor-Mac Company, Inc., ERD Case No. CR201402160
(LIRC April 19, 2018), the commission specifically agreed that the complainant
had introduced no evidence to suggest that Jor-Mac paid him less than other workers or denied him
an experienced-based premium to which he
was entitled. The same issues that are
raised in the instant claim were essential to the decision in Jor-Mac
and were resolved in that matter.
The second step in the issue preclusion analysis
is to determine whether applying issue preclusion comports with principles of
fundamental fairness. The central goal
of the “fundamental fairness” analysis is to protect the rights of all parties
to a full and fair adjudication of all issues involved in the action. /span> The decision should be made with special
attention to guarantees of due process which require that a person must have
had a fair opportunity procedurally, substantively and evidentially to pursue
the claim before a second litigation will be precluded.Aldrich, 2012 WI 53, ¶109. When considering whether the “fundamental
fairness” test is met courts generally look to five factors:
(1)
Could
the party against whom preclusion is sought have obtained review of the
judgment as a matter of law;
(2)
Is the
question one of law that involves two distinct claims or intervening contextual
shifts in the law;
(3) Do significant differences in the
quality or extensiveness of proceedings between two courts warrant relitigation
of the issue;
(4) Have the burdens of persuasion shifted
such that the party seeking preclusion had a lower burden of persuasion in the
first trial than in the second; and
(5) Are matters of public policy and
individual circumstances involved that would render the application of
collateral estoppel to be fundamentally unfair, including inadequate
opportunity or incentive to obtain a full and fair adjudication in the initial
action?
Aldrich, 2012 WI 53, ¶110.
The commission is satisfied that all five factors
are met in the instant case. 1) The complainant could and did seek review of
the administrative law judge's findings in the Jor-Mac
case--he petitioned for a review
by the commission, which affirmed the decision. The complainant could have petitioned for further review by a circuit
court, but he did not exercise that option. 2) The matter is not one of law
involving distinct legal analysis. Both Jor-Mac
and the instant case involve an application of the provisions of the Wisconsin
Fair Employment Act, §§ 111.322 and 111.335. 3) There is no difference in the quality or extensiveness of the
proceedings, both of which are before the Equal Rights Division. Moreover, the complainant was represented by
counsel in both actions. 4) There
is no shift in the applicable burdens of persuasion; in both instances the
burden rests with the complainant to prove discrimination. 5) There are no matters of public policy
or individual circumstances that would make application of issue preclusion
fundamentally unfair in this case.
With respect to the latter, Factor 5, it is worth
noting that issue preclusion is an affirmative defense
which would ordinarily be a matter for the respondent to raise in its answer or
other pleading, and the commission recognizes that it is somewhat unusual for
the decision-maker
to raise the matter of issue preclusion sua
sponte. However, in this case, the
decision which arguably has preclusive effect was only recently issued--well
after any answer was due and after all briefs had already been filed--and
the respondent's opportunity to raise the matter was limited. Further, as the Supreme Court has explained, “The purpose of
requiring claim preclusion and issue
preclusion to be pleaded
is to give the opposing party notice of the plea of estoppel and a chance to
argue, if he can, why the imposition of an estoppel would be
inappropriate.”Blonder-Tongue Labs., Inc. v. University of Ill. Found., 402 U.S. 313, 350 (1971). Thus, any prejudice arising by virtue of the fact that
issue preclusion was not raised by the respondent in a pleading is resolved
where the commission provided the parties with an opportunity to brief the
issue and gave the complainant's attorney notice and a chance to show why issue
preclusion would not be appropriate in this case. See,
United States
v. Sioux Nation of Indians, 448 U.S. 371, 100 S. Ct. 2716,
65 L. Ed. 2d 844, 1980 U.S. LEXIS 147 (if a court is on notice that it has
previously decided the issue presented it may dismiss an action sua sponte, even though the defense has
not been raised, but the party against whom preclusion would be applied must be
given an opportunity to demonstrate why it should not apply).[6]
For the reasons set forth above, the commission concludes that the
conditions for the application of issue preclusion are all met in this
case. The issue of whether the
complainant was discriminated against in his compensation based upon his arrest
and conviction record while working for Jor-Mac has already been litigated, and there are no fundamental
fairness principles preventing the commission from determining that the legal
conclusion reached in the prior proceeding (that Jor-Mac did not discriminate
against the complainant in wages) effectively resolves the issue presented in
this case. This matter is therefore
dismissed on the basis of issue preclusion.
Attorney Eric Mullenbach
[1] Appeal
Rights: See
the green enclosure for the time limit and procedures for obtaining judicial
review of this decision.If you seek
judicial review, you must name the
Labor and Industry Review Commission as a respondent in the petition for
judicial review.
Appeal rights and answers to frequently asked questions about
appealing a fair employment decision to circuit court are also available on the
commission's website, http://lirc.wisconsin.gov.
[2]
The complaint against Jor-Mac
focused on the allegation that the complainant was paid less than other workers
based upon his arrest and conviction record, and did
not contain any reference to collusion with the respondent. The complaint also included an allegation
that the complainant was retaliated against for having filed a prior
discrimination complaint.
[3]
Wisconsin courts have at times looked
to federal employment law for guidance in considering discrimination cases
under the Wisconsin Fair Employment Act. Racine Unified School Dist. v.
LIRC, 164 Wis. 2d 567 (Ct. App. 1991).
[4] On
this point, the EEOC's Compliance Manual
provides:
A
prison does not have an employment relationship with its own prisoners. Thus, its supervision of prisoners performing
work in the prison is not subject to the EEOC statutes, even if the
work is being perform for monetary or other compensation. Nonetheless, if a correctional institution is
a covered employer, it would be prohibited from discriminatorily interfering
with an inmate's employment with an outside employer through a work release
program. . .
See, EEOC Compliance
Manual, Number 915.003 (Third-Party
Interference with Employment Opportunities – Correctional Facilities).
[5] Although the previous
litigation involved an administrative agency and not a court, agency decisions
can also have preclusive effect.Lindas v. Cady, 183 Wis. 2d 547, 515
N.W.2d 458 (1994).
[6]
The complainant's attorney filed a
brief on the complainant's behalf asserting, with no further supportive
argument, that issue preclusion did not apply. In a subsequently filed responsive brief the complainant's attorney
maintained, for the first time, that because the issue of jurisdiction was not
decided in the Jor-Mac case, the question of issue preclusion was
not reached.The complainant opted to
make no further argument with respect to the preclusive effect of the findings
of fact and conclusions of law made in Jor-Mac.