MELVIN LUCKMAN, Complainant

WESTERN-SOUTHERN LIFE INSURANCE COMPANY, Respondent

An Administrative Law Judge for the Equal Rights Division of the Department of Industry, Labor and Human Relations issued a decision in the above-captioned matter on May 4, 1989. Complainant filed a timely petition for review by the Commission and both parties subsequently submitted written arguments.

Based upon a review of the record in its entirety, the Labor and Industry Review Commission issues the following:

1. Respondent, Western-Southern Life Insurance Company ("company") is a life insurance company doing business in, among other places, Milwaukee, Wisconsin. It has its corporate offices in Cincinnati, Ohio.

2. Complainant Melvin Luckman ("Luckman") was working in another job in 1984 when he was approached by Don Eisner, an associate sales manager with the company, about coming to work for the company. Eisner eventually persuaded Luckman to consider employment with the company, and on a Saturday early in November 1984, Luckman met with Eisner, Mark Thomas, another sales manager, and William Mann, the branch manager, at the company's Milwaukee branch office to discuss Luckman's interest in employment with the company. Luckman was given a "career profile test" to assess his suitability for and interest in the position as a salesman for the company, and he passed the test successfully. He was then given an application for employment and an application for coverage under the health insurance plan available to salesmen, with instructions that he should complete them at home and submit them later.

3. On November 5, 1985, Luckman signed the applications. The application materials included a question asking whether the applicant had any criminal convictions, and a number of questions requesting information about past medical treatment. These applications were returned to the company's office.

4. When Mann reviewed the applications received back from Luckman, a number of the inquiries on the application for employment had not been completed. Among these were the section on bank references and the inquiry about conviction record. Mann gave the forms to Eisner with instructions that he should take them to Luckman to have them completed. Eisner returned the forms to Luckman, who added more information. The forms were then returned to Mann by Eisner.

5. Sometime before November 12, 1984, Mann decided to recommend the hire of Luckman, and he forwarded his recommendation, along with Luckman's application materials, to the company's corporate office in Cincinnati.

6. On November 12, 1984 a representative of the company in its corporate office mailed a request for a background check on Luckman to Equifax, an investigation firm. Shortly thereafter, the company requested some additional information from Equifax concerning Luckman, apparently with respect to his dependents. By late November, the reports had been received from Equifax. They were wholly positive.

7. On November 26, Thomas Dehmer, an employe of the company in its corporate underwriting department in the Cincinnati office, began reviewing Luckman's application materials and the Equifax reports. He also initiated requests for medical records connected with treatment that Luckman had disclosed in connection with his application for insurance coverage. At about this time, Luckman also submitted to a physical examination at a clinic to which he was sent by the company.

8. Mann's recommendation for the hire of Luckman was accepted,and Luckman was hired as a salesman for the company effective December 3, 1984.

9. Luckman showed almost immediate success in his position as a salesman. By March 1985 he had the highest sales among the Milwaukee district's 19 salesmen.

10. In his application for coverage under the health insurance plan the company made available to its salesmen, Luckman had indicated that he had undergone surgery for removal of his gallbladder in April 1981 at "St. Francis Hospital." He disclosed no other previous surgery. However, the company somehow became informed -- possibly by way of information provided by Luckman to the physician who examined him on November 26, 1984 -- that Luckman had in fact undergone surgery for correction of an ulcer in April 1971 at St. Vincent Hospital in Green Bay, Wisconsin. As part of its efforts to process Luckman's application materials, the company requested St. Vincent Hospital to forward its records concerning this surgery. This request was mailed to St. Vincent Hospital on November 26, 1984 and was apparently received there in early December 1984. However, for reasons not disclosed by the record, there was a delay in the return to the company by St. Vincent Hospital of documentation concerning the surgery. Luckman, who was made aware by the company of the fact that the availability of health insurance coverage for him could be delayed by the failure of St. Vincent Hospital to forward the records, made some efforts by way of telephone calls to the hospital to have the records forwarded.

11. On January 21, 1985 Luckman's application for insurance coverage was approved on a tentative or "minimum benefits" basis, as the reports from St. Vincent Hospital had still not been received.

12. On February 20, 1985, Thomas Dehmer received the attending physician's report relating to Luckman's 1971 ulcer surgery at St. Vincent Hospital in Green Bay. In the course of reviewing the reports, Dehmer noted that the discharge summary indicated that Luckman was an "inmate of Wisconsin State Reformatory," and that the social history indicated that Luckman was "a reformatory inmate, apparently serving a term for aggravated assault." Dehmer underlined these entries on the copy of the medical reports he had received. Dehmer also inspected the application for employment signed by Luckman on November 5, 1984, and noted that, under the question asking whether the applicant had ever been convicted of any crime, there was a mark drawn through the "no" box. In response to these discoveries, Dehmer contacted the company's legal department and discussed the situation with a representative of that department, at whose request the file was then forwarded to the legal department.

13. On February 27, 1985, the company's personnel department was instructed by the company's legal department to contact Equifax again to request a supplemental report concerning the question of Luckman's prison record. An employe of the company's personnel department, Adeline Rigdon, telephoned the request for this supplemental report to Equifax on that date. She either directly requested, or her request was treated by Equifax as seeking, information as to why Luckman had been sentenced to prison, what the details surrounding the charges were, whether he was paroled and whether he was currently on parole. Rigdon requested that Equifax notify the head of the company's personnel department, Carl Schepman, by telephone when the requested information was available.

14. At some point in late February or early March 1985, Dennis Lehman, vice president of the division of the company of which the Milwaukee office was a part, was advised by either the personnel department or the legal department of the fact that a question had come up concerning Luckman's past and the accuracy of his application for employment. At around this time, Lehman telephoned Mann and outlined the situation to him.

15. After receiving the call from Lehman, Mann called Luckman into a meeting, at which Mark Thomas was also present. This meeting occurred on or around March 12, 1985. In the meeting, Mann communicated to Luckman that there was a problem in connection with his past. He may have made some reference to drugs. In response, Luckman disclosed to Mann that he had a number of prior criminal convictions.

16. On March 27, 1985, a representative of Equifax called Carl Schepman and informed him of Equifax's findings with respect to Luckman's criminal record. Schepman was apparently told by Equifax that Luckman had been convicted of a number of crimes in 1969, including burglary and injury by conduct regardless of life, that there was a conviction in 1969 for armed robbery, a conviction in 1984 on a burglary which had occurred in 1967, and concurrent charges of possession of marijuana and carrying a concealed weapon on which Luckman was given a probationary period of two years. It was further indicated that Luckman was imprisoned from August 26, 1968 until the date of his parole on July 20, 1974, and that he was discharged from parole on November 8, 1982. On the same day that he received this information, Schepman communicated with Lehman concerning this updated report from Equifax.

17. After being informed by Schepman of the udpated report from Equifax, Lehman decided to terminate Luckman. He telephoned Mann and so advised him, directing him to terminate Luckman, and he then confirmed this by a letter to Mann dated March 29, 1985, with which he submitted to Mann a termination letter to be presented to Luckman, and final checks for Luckman.

18. On March 29, 1985, Mann met with Luckman and advised him that he was being terminated, presenting him with the termination letter. The termination letter, dated March 29, 1985, stated that the termination was due to falsification of the personal history form for employment, specifically with respect to failure to admit a conviction record for criminal offenses.

19. Subsequent to his termination, Luckman wrote a letter to Lehman asking him to reconsider the termination decision. In his letter, he asserted that at the time of his adult conviction he was legally a juvenile, that there were no drugs involved and no drug charges brought against him, that if he had been trying to hide his past offenses he would not have revealed his past surgery in Green Bay knowing that doing so would reveal his past incarceration, and that he did not falsify his application with the State of Wisconsin for licensing as an insurance agent or his application with another insurer for whom he had worked and that the acceptance of these applications led him to believe that nothing would be held against him. He also stated in his letter that it was "also [his] thinking that [he] had left the question open in regards to past felony convictions so that it would be discussed at the time of the initial interview."

20. On April 8, 1985, Luckman went to Cincinnati, with his minister, and met with Lehman in his office, again to attempt to convince him to rescind the termination decision. In this meeting, Luckman told Lehman that he thought he had left the question on the application concerning conviction record open but couldn't be sure. At the time, Lehman considered that point to be immaterial, since he felt that, even if Luckman had simply left the question blank, this would have constituted a misrepresentation warranting termination just as much as if he had marked it no. Lehman declined to rescind the termination.

21. A written report from Equifax containing the information that had been relayed to Carl Schepman on March 27, 1986 was mailed by Equifax to the company on March 28, 1985. It was not received by the company until early April 1985, after the decision to terminate Luckman had been made.

22. The information contained in the Equifax report was incorrect in a number of respects. Among other things, Luckman had never been charged with or convicted of possession of marijuana or any other drug offense, and he had not been convicted of any crime in 1984, or at any time later than 1972.

23. The decision to terminate Luckman was made by Lehman. Lehman decided to terminate Luckman because he believed, based on the reports to him from Carl Schepman to the effect that Equifax had confirmed that Luckman had prior convictions, that Luckman had a record of criminal conviction, and because he believed that Luckman had checked the "no" box under the question concerning prior criminal convictions on his application for employment. It was Lehman's belief that Luckman had falsified his application for employment, and not any knowledge or belief Lehman had that Luckman had a criminal record, that motivated Lehman to fire Luckman.

Based on the Findings of Fact made above, the Commission makes the following:

CONCLUSIONS OF LAW

1. The Respondent, Western-Southern Life Insurance Company, is an employer within the meaning of the Wisconsin Fair Employment Act.

2. Western-Southern Life Insurance Company did not discharge Melvin Luckman because of his conviction record in violation of the Wisconsin Fair Employment Act.

Based on the Findings of Fact and Conclusions of Law made above, the Commission now makes the following:

That the complaint in this matter be dismissed.

Dated and mailed at Madison, Wisconsin, this 16th day of February, 1990.

/s/ Kevin C. Potter, Chairman

/s/ Carl W. Thompson, Commissioner

/s/ Pamela I. Anderson, Commissioner

This case concerns the decision by Western-Southern Life Insurance Company to terminate the employment of one of its salesmen, Melvin Luckman, in March 1986. Luckman contends that he was discharged because of his conviction record, in violation of the Wisconsin Fair Employment Act. The company argues that Luckman was not discharged because of his conviction record, but because he falsified his application for employment by indicating that he had never been convicted of a criminal offense when, in fact, he had. The issue presented is thus one of the employer's motivation in firing Luckman. Based on its review of the evidence, and having carefully considered the arguments on behalf of the parties, the Commission has concluded that, although the company came to believe that Luckman had a criminal record, it was not the belief that there was such a criminal record that motivated the termination. The evidence convinces the Commission that the motivation for the termination was a belief on the part of the company that Luckman had affirmatively indicated on his application for employment that he had no criminal record, and that this had been untruthful.

Luckman argues that the evidence supports a conclusion that it was not any alleged concern about falsification, but rather the company's beliefs as to the conviction record itself, that motivated the decision to terminate him. Thus, he argues that the employer knew of his conviction record when it received the medical records from St. Vincent Hospital immediately after his hiring, and received further confirmation of that conviction record when Luckman admitted it in his meeting with Mann in the early part of March, but did not fire him until after Equifax provided the company with details about the nature of the offenses.

However, Luckman is wrong in asserting that the company knew of his incarceration immediately after his hiring. This argument is apparently made in reliance on what appears to be a date stamp of December 7, 1984 on the front page of the medical records request which accompanied the Green Bay medical records when they were returned to the company. However, there was no evidence that this was a date stamp of the company, and other evidence strongly suggests that it was probably a date stamp of the hospital, an indication of when it received the request for the medical records. The Commission is satisfied that the medical records were not actually received by a representative of the company until February 20, 1985.

Furthermore, the Commission does not find it significant that the company did not immediately terminate Luckman for falsification of his employment application when it received these medical records at that time. Although they raised a suggestion that merited looking into, the records themselves were hardly a reliable enough proof of the existence of a conviction record that a reasonable company would have felt comfortable in undertaking the drastic action of termination in response to them. The records did not come from the state prison system, but rather from a private hospital. Their reliability and accuracy could not be assumed. The fact that the representative of the company who received these records and noted the indications about incarceration promptly contacted the company's legal department to discuss the significance of the information in view of the entry on the employment application, is evidence that there was genuine concern about the issue of falsification of the employment application. With respect to the matter of Luckman's confirmation to Mann in early March 1985 of the fact that he had a prior conviction record, Luckman's argument is also not convincing, since it is clear from the record that Mann neither made the decision to discharge Luckman nor had any input into it. In particular, the Commission considers that there is no reliable evidence in the record that Mann communicated to Lehman, after his meeting with Luckman, that Luckman had confirmed to him that he had a prior conviction record. Mann did not testify to any contact with Lehman between his early March meeting with Luckman and the call from Lehman later in the month informing him that Luckman had to be terminated. Lehman testified, in response to a question as to whether Mann called him after his early March meeting with Luckman, that it "could be" that he had done so but that he did not recall. On the basis of such evidence, the Commission is unwilling to make a finding that Mann communicated to Lehman that Luckman had admitted, in their early March meeting, that he had a conviction record.

Thus, the Commission concludes that, up until the time that he received the communication from Schepman on March 27, 1985, the only indication Lehman had that Luckman had a prior criminal record were the suggestions to that effect in the 1971 medical records. That Luckman was not discharged on the basis of that evidence alone does not strike the Commission as remarkable. Luckman's argument, that it was the employer's beliefs and concerns about the criminal record itself as disclosed by the Equifax report, is considered unconvincing. It is undisputed that Lehman did not actually see that report before making the decision to terminate Luckman. Although some of the content of that report may have been transmitted to Schepman by Equifax via telephone, and then to Lehman by Schepman, it is unclear to what extent the details were covered. It is clear, however, that Lehman was unequivocally advised on March 27 that Equifax had confirmed that Luckman had prior criminal convictions. The Commission finds credible the testimony of Lehman that he was concerned simply with determining whether in fact there had been prior criminal convictions, and that it was the confirmation of this fact, in combination with his belief that Luckman had denied prior convictions on his application for employment, that led to his decision to terminate Luckman.

Luckman argues that the topic of drug use came up in his early March meeting with Mann, and that this proves that it was the company's concern about the nature of his convictions, rather than any concern about falsification of the employment application, that motivated it. The Commission is not convinced by this argument. For one thing, the Equifax report clearly could not have been the source of any concerns Mann expressed in early March about drug use in Luckman's past, since the Equifax findings had not even been communicated to the company orally at that time. As to the question of why the topic of drugs came up in this meeting, the Commission suspects that it may be related to what was apparently a prior discussion between Luckman and Thomas (who was also present at the early March meeting with Mann). At the unemployment compensation hearing held on Luckman's claim for benefits, the transcript of which was received into the record in this proceeding as Complainant's Exhibit #33, Luckman testified about a conversation he apparently had with Thomas in Thomas' home prior to Luckman's termination:

"Q: And the bottom line is you had no intention of bringing forward your conviction, unless somebody asked you about it?

A: I had--well, I had--I had talked to--let's say I'm not saying that I would have never mentioned that to anybody, okay. I would have--I know that Mr. Thomas had felt that, you know, there was something because I had witnessed to him about my life and how the Lord had changed by my life and taken me out of the drug world and the alcohol and the crime world that I used to live in. And it changed my life, and I had given my testimony at his home. But I didn't mention about my past, I had just told him about--I went in a roundabout way about what God had delivered me from and gave me a new direction in life. And that's what I was pursuing here with Western-Southern Life Insurance Company, as well--a professional career." (Complainant's Exhibit 33 , p. 51 . )

It appears, in other words, that at some point prior to his termination Luckman may have had some conversation with Thomas in which he suggested that he had some connection with or exposure to drugs in the past. This could certainly account for the topic coming up at the meeting. It does not tend to demonstrate, however, that Lehman (who, as noted above, apparently was not informed of anything that occurred at this meeting) made his decision to terminate Luckman on any basis other than his concern that Luckman had falsely reported on his application for employment that he had no prior convictions.

Luckman also argues that he did not, in fact, falsify his employment application, because, he asserts, he actually left the question concerning prior conviction record blank. Luckman speculates that someone else, such as Don Eisner, made the checkmark in the "no" box under that question, consistent with some supposed or alleged tendency on the part of the company's agents to "cut corners" by filling in omissions on forms and paperwork they were processing in order to facilitate acceptance of the forms.

The Commission agrees with the Administrative Law Judge, that it is irrelevant whether Luckman in fact checked the "no" box under the prior convictions questions on his employment application, or left it blank, but it does so based on a different rationale than that adopted by the Administrative Law Judge.

An allegation of discrimination because of conviction record (or any other protected status under the Fair Employment Act) raises a question as to why an employer made a particular decision. If the decision was made because of the protected characteristic, it may (subject to the applicability of any affirmative defenses) be found to have violated the Act; if, on the other hand, the decision was not made because of a protected characteristic, there will be no violation. If an employment decision is not made because of a protected characteristic, it is irrelevant if it was made because of a mistaken view as to certain facts. The "real" state of the underlying facts does not necessarily have any direct bearing on the question of what the decisionmaker's motive was; it is necessary to look at the evidence as to what the decisionmaker believed the facts of the case were. Here, Luckman has introduced no convincing evidence that Lehman did not in fact believe that Luckman had checked the "no" box under the question concerning prior convictions on the employment application. The record is undisputed that, however it came about, the "no" box under the prior convictions question on Luckman's application for employment had a checkmark through it by the time it arrived at corporate headquarters in Cincinnati and was inspected by Dehmer and, subsequently, the personnel and legal departments and Lehman. The record leaves no reason to doubt that all persons involved at that stage of the process believed that Luckman had made the "no" entry. The physical appearance of the form, the color of the ink used, and the consistency of the checkmark through that box with other marks on the form, are such that no one inspecting the form would have had any reason to question the authenticity of the mark in that box. It was only in the meeting between Luckman, his minister, and Lehman, subsequent to the discharge, that Luckman's statement that he "felt" he left the box open could have raised even a shadow of a doubt on the question. Because of this, and because Luckman similarly failed to offer any convincing evidence (apart from speculation) that someone else had checked the box, much less that anyone else who had done so had done so out of some motivation prohibited by the Fair Employment Act, the question of how the mark came to be placed in the box is not relevant.

Luckman's argument, that his convictions were for conduct he engaged in when he was under the age of 21 and that they were thus "juvenile" offenses because the amendment to the United States Constitution relating to age 18 voting had not gone into effect at that time, is meritless. For purposes of criminal as opposed to juvenile court jurisdiction, the age of majority in Wisconsin had been 18 for many years prior to 1969. The evidence in this case leaves absolutely no doubt that the convictions were rendered in criminal court, not juvenile court.

Luckman argues that Lehman was biased against persons with criminal records based on an answer Lehman gave in his testimony at the hearing in this matter: in response to the question, "How many convicts do you have working for Western-Southern," he answered, "Hopefully none." However, Lehman then testified, in explanation of what he meant by this, that "I would like to say that I don't have any active convicts out handling our policyholders." The Commission considers it likely, particularly given this explanation, that Lehman was drawing a distinction, between "convicts" as persons still serving prison sentences, and "ex-convicts," persons who served sentences and were released. The answer is therefore not particularly suggestive of any prohibited bias.

The Commission has considered the other arguments and points made by Luckman in his briefs, but finds then unconvincing.

110

Appealed to Circuit Court.  Affirmed September 4, 1990.

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