DONNA V. CANGELOSI, Complainant

ROBERT E. LARSON & ASSOCIATES, INC., 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 June 20, 1990. Respondent 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:

FINDINGS OF FACT

1. Robert E. Larson and Associates, Inc., ("Larson and Associates") is a Wisconsin corporation engaged in providing executive recruiter services to area businesses. Robert E. Larson ("Larson") is employed by Larson and Associates and has been president of Larson and Associates since 1972. As president, Larson is completely responsible for the management of Larson and Associates, and for billing and collecting from customers.

2. Donna Cangelosi was single throughout 1986 and 1987. She had 14 years of school prior to coming to Larson and Associates, but had no experience as an executive recruiter.

3. Cangelosi was hired by Larson and Associates on November 20, 1986 as an executive recruiter. As an executive recruiter her responsibility was to find businesses with positions to fill, find candidates interested in employment, and match candidates to available positions.

4. Cangelosi worked for Larson and Associates under a written contract which provided, among other things, that all work done by her in the field of recruiting had to be performed exclusively for Larson and Associates. Cangelosi, like the other executive recruiters employed by Larson and Associates, was expected to, and did, work from 8:30 a.m. through at least 5:00 p.m., was given basic office supplies, had to account for all time in and out of the office, and had to check in and out with Larson. Cangelosi was paid by commission equal to 40 percent of billed fees. Expenses chargeable to fees were paid out of the fee before Cangelosi received her 40 percent share.

5. In December 1986, Larson and Associates employed five executive recruiters, Mary Larson (Robert E. Larson's daughter), Neil Davidson, Fred Gruber, Loretta Rutzinski, and Cangelosi. Rutzinski was married, and the other recruiters were single.

6. In December 1986, Larson announced a bonus contest to the recruiters. The terms of the contest which he announced were that recruiters would have to bill at least $15,000 in fees for the first quarter of 1987 in order to qualify (except that Mary Larson, in order to qualify, had to bill at least $20,000 in fees), and that, among those qualifying, there would be a first prize (for highest billings) of a trip by air to Hawaii for two people for two weeks, plus $400 spending money. Other prizes, for second through fifth place, were also announced. These were all trips for two, but for increasingly shorter periods of time, to increasingly closer destinations, and with progressively smaller sums of accompanying spending money.

7. In the first quarter of 1987, Cangelosi generated fees of over $27,000.

8. In the beginning of April 1987, Larson told Cangelosi that she was the only person to meet the qualification requirements for the contest and that she had won the contest. Larson then told Cangelosi that the trip she had won would be for one person because she was not married. He also described other restrictions on the trip which had not been stated in the original description of the terms of the contest.

9. At that time, Cangelosi objected to Larson about his refusal to provide the trip for two. However, there is no evidence that when she did so she indicated in any way that her objection was that Larson was discriminating on the basis of marital status, nor is there any evidence that Larson understood her to be objecting on that basis. It is inferred that Cangelosi's objection to Larson's refusal to grant her the trip for two was based on the fact that Larson had earlier said it would be for two and on her belief that Larson had lied and was breaking his agreement.

10. Also in and around April 1987, Cangelosi began to believe that Larson was not paying her all the commissions which were due to her.

11. Prior to April 1987, Cangelosi and Larson had a congenial and positive relationship. However, the matter of the trip promised as a prize for winning the contest and the unpaid commissions led to increasing conflict between Cangelosi and Larson.

12. The relationship between Larson and Cangelosi changed greatly over the month of April, so that by May and continuing through the end of Cangelosi's employment, the two of them argued almost daily about receiving commissions and about the trip. Cangelosi lost motivation for work. She also thought Larson had lied, and she did not trust him. Larson was concerned with Cangelosi's challenges to him and her coming in at 7:00 a.m. one day, occasionally working late, serving as a wine taster for Channel 10, going to a job fair in Chicago against Larson's advice, and taking trips to Rice Lake and Minnesota.

13. After the development of the disputes between Cangelosi and Larson over the trip and the commissions, Cangelosi did not perform her job as effectively as she had before, and she made relatively few placements. Larson criticized her for not producing.

14. A further dispute over commissions erupted between Cangelosi and Larson in May 1987 when Larson significantly reduced a commission due to Cangelosi because the customer had resisted paying the entire fee and Larson had eventually discounted the fee to 66 percent.

15. On July 7, 1987 there was a meeting between Larson and Cangelosi. Cangelosi again indicated that she wanted the trip for two plus $400 and all commissions due her. Larson told her to forget it, to give him the key that she was given when she began her employment and which had remained in her possession since that time, and to stop seeing or contacting clients or prospective clients. Larson did not indicate at this meeting that Cangelosi could come back to work at a future date. By taking her key and preventing her from contacting clients, Larson terminated Cangelosi's employment. Larson terminated Cangelosi's employment as a result of the conflict between them over the denial of the trip for two and the withholding of commissions.

16. After the effective termination of Cangelosi on July 7, 1987, Cangelosi and Larson continued their dispute over Cangelosi's right to the trip to Hawaii for two and to commissions, by way of correspondence. Their dispute at that point focused not only on Cangelosi's right to the trip and the commissions, but also on Larson's insistence that Cangelosi submit a written resignation. The issue of resignation as opposed to termination had significance because of provisions in the contract under which Cangelosi had been employed, which established different rights to accrued commissions upon the end of employment depending on whether the employment had ended by termination or resignation.

17. The dispute between Cangelosi and Larson was not resolved. Eventually, they had a face-to-face meeting on August 13, 1989, which culminated in a physical confrontation which involved the police being called. Even after this occurrence, and further correspondence, the dispute between them remained unresolved.

18. Cangelosi's marital status was a factor in Larson's decision to deny her the trip for two to Hawaii which had been promised as first prize in the fee billing contest.

19. Cangelosi was discharged because of the dispute between her and Larson over Cangelosi's entitlement to the trip for two to Hawaii and over her right to certain commissions. However, there is no evidence that Cangelosi had ever opposed the denial of the trip to her on the ground that this constituted prohibited employment discrimination, that she had ever made her opposition known to Larson as being pursued on these grounds, or that Larson ever had a belief or perception that Cangelosi's opposition to the denial of the trip was being pursued on those grounds. Thus, Larson did not terminate Cangelosi because of any belief or perception on his part that she was opposing a practice because she felt it was prohibited employment discrimination.

20. Larson also did not terminate Cangelosi because of her marital status.

Based on the FINDINGS OF FACT made above, the Commission makes the following:

CONCLUSIONS OF LAW

1. Respondent Robert E. Larson and Associates, Inc., is an employer within the meaning of the Wisconsin Fair Employment Act.

2. The relationship between Donna Cangelosi and Robert E. Larson and Associates, Inc., is subject to the Wisconsin Fair Employment Act.

3. Robert E. Larson and Associates, Inc., discriminated against Donna Cangelosi because of marital status, in violation of the Wisconsin Fair Employment Act, when it refused to provide her the trip she had won for two persons because she was not married.

4. Robert E. Larson and Associates did not discriminate against Donna Cangelosi because of marital status, in violation of the Wisconsin Fair Employment Act, when it discharged her.

5. Assuming arguendo, that the issue may be reached, Robert E. Larson and Associates did not discriminate against Donna Cangelosi because she had opposed any discriminatory practice under the Wisconsin Fair Employment Act, in violation of the Act, when it discharged her.

Based on the FINDINGS OF FACT and CONCLUSIONS OF LAW made above, the Commission makes the following:

ORDERS

1. That insofar as the complaint in this matter alleges that Robert E. Larson and Associates, Inc., discharged Donna Cangelosi in violation of the Wisconsin Fair Employment Act, it is dismissed.

2. That Robert E. Larson and Associates cease and desist from discriminating against Donna Cangelosi because of marital status as described in paragraph 3 of the CONCLUSIONS OF LAW above.

3. That Robert E. Larson and Associates, Inc., shall consult with three travel agencies and ask them to price an all-expense-paid trip for two to Hawaii of average quality with reasonable choices as to when it will be taken. Robert E. Larson and Associates, Inc., shall then choose one of the three travel agencies' proposed trips, and offer Cangelosi the choice of receiving the trip that travel agency devised plus $400 spending money, or the cash value of that trip and $400 spending money.

4. That Robert E. Larson and Associates, Inc., pay to Donna Cangelosi, as reasonable attorney's fees and costs in this matter, the sum of $4,911.83. This sum shall be paid by check made payable jointly to Donna Cangelosi and Attorney Sarah J. Elliott and delivered to Attorney Elliott.

5. Respondent shall within 30 days of the expiration of time within which an appeal may be taken herein, submit a compliance report detailing the action taken to comply with the Commission's Order. The compliance report shall be directed to the attention of Kendra DePrey, Labor and Industry Review Commission, P. O. Box 8126, Madison, Wisconsin 53708.

Dated and mailed November 9, 1990.

/s/ Kevin C. Potter, Chairman

/s/ Carl W. Thompson, Commissioner

/s/ Pamela I. Anderson, Commissioner

The Commission has partially reversed the decision of the Administrative Law Judge (ALJ) to eliminate the finding of discrimination in regard to discharge, as a matter of law. There are two principal reasons for the Commission's disagreement with the ALJ, that the discharge of Cangelosi violated the Wisconsin Fair Employment Act.

The first reason is that the ALJ appears to have made the finding of discrimination in discharge on the basis of a factual theory that was neither raised in a complaint, investigated, nor identified in the Notice of Hearing as an issue. Specifically, the conclusion of discriminatory discharge because of marital status was not premised on a finding that Cangelosi's marital status was a factor in the decision to discharge her. Indeed, no such finding of fact was made on the basis of which such a legal conclusion could rest. Rather, the ALJ relied on what was in effect a finding that the discharge was in retaliation for opposition to discriminatory practices. However, this issue was not before him.

Discrimination because of a person's membership in a protected classification, and retaliation because a person has opposed a discriminatory practice, are different things. They are treated separately in the Fair Employment Act, in sec. 111.322(1) and (3), Stats. Either one may exist without the other. Thus, an employer may be found to have illegally retaliated where it has taken adverse action against an employe because of that employe's assertion that the employer has discriminated against the person because of some protected characteristic, even if it is later established that the employer is not guilty of the alleged underlying discrimination. Conversely, an employer who has discriminated against a person because of some protected characteristic may subsequently take adverse action against a person who has opposed that underlying discrimination, and yet not be guilty of retaliation, if the adverse action is not taken because of a belief or perception on the employer's part that the employe had opposed a practice as having been discriminatory. For this reason, it is incumbent on investigatory and adjudicatory authorities to properly distinguish between allegations of discrimination and allegations of retaliation, and to address only those allegations that are actually presented in a case.

The Commission has previously drawn this distinction between issues of discrimination and issues of retaliation. In Hoyer v. LIRC (Dane County Circuit Court, #83-CV-2378, November 10, 1983), the circuit court. affirmed a ruling by the Commission that an issue of whether a complainant was discharged because of sex was not properly before it when the complaint alleged, "Because I have previously filed a charge of discrimination against the (respondent) I am now being terminated." The Commission had concluded that the complaint raised only the issue of retaliation. In Winter v. Madison Home Juice Company (LIRC, July 19, 1985), the converse situation was presented. The complaint in that case alleged that respondent had constructively discharged complainant by subjecting her to sexual harassment. That allegation was investigated and noticed for hearing, but the complainant then sought to have the case decided on the theory that she had been discharged in retaliation for opposing discriminatory conduct. The Commission refused, stating:

"The Commission declines to make a finding on the issue of retaliatory discharge. Retaliatory discharge was not mentioned in either of the two complaints, the initial determination or the notice of hearing. It was raised for the first time as an issue in Complainant's post-hearing brief. The Commission considers that this is inadequate notice to Respondent that retaliatory and not constructive discharge is an issue in the case. Retaliatory discharge and constructive discharge are separate legal issues and Respondent is entitled to adequate notice if Complainant wishes to litigate one instead of the other."

The complaint in this matter specifically alleged, "I was discriminated against because of my marital status (single) in regard to conditions of employment (denied a cash prize and bonus trip for two) and discharge in violation of sec. 111.31-111.395 of the Wisconsin Statutes." These are the issues that were addressed in the Initial Determination and Amended Initial Determination. The Notice of Hearing which was subsequently issued indicated that the hearing would be held to determine whether Respondent terminated Cangelosi, and discriminated against her in compensation (bonus), because of marital status. Thus, the issues before the Administrative Law Judge in this matter were whether Respondent denied Cangelosi a benefit because of her marital status, and whether Respondent terminated Cangelosi because of her marital status. Just as in the Winter case, however, Complainant sought for the first time in her post-hearing brief to have the case decided on the theory that her discharge had been in retaliation for acting in opposition to practices she believed were discriminatory. The case should not have been decided on that basis.

The Commission is mindful of the teaching of the court of appeals in Hiegel v. LIRC, 121 Wis. 2d 205 (App. 1984), that it may be unfair in some circumstances to read the scope of a complaint narrowly against the complainant so as to preclude the complainant from presenting evidence on certain issues. However, the commission does not believe that Hiegel requires it to allow a complainant, who has alleged and pursued only a claim of discharge because of marital status, to also have her case decided on the theory that she was discharged in retaliation for opposing a discriminatory practice. In Hiegel, the complaint alleged discrimination on the basis of sex in regard to wages, and it concerned a claim that complainant, employed in a particular classification of the employer's operation, performed the same duty as other, primarily male, employes in a different classification, but was paid less. At the hearing on the complaint, the complainant attempted to introduce evidence showing that the employer systematically hired females for the lower paying classification and males for the higher paying classification. The hearing officer refused to allow this evidence, on the theory that it related to a claim of discrimination in hire, and it was this action that the court of appeals subsequently determined to have been in error. The situation in Hiegel is unlike that presented in this case. The distinction between a claim that an employer discriminates on the basis of sex in what it pays males and females, and a claim that the employer systematically hires females into a lower paying classification and males into a higher paying classification when both classifications perform the same duties, is a very fine one, if it is possible to draw the distinction at all. This is not the case here. A claim of discharge because of marital status is legally and factually distinct from a claim of discharge because of opposition to other actions believed to have been marital status discrimination.

The second reason that the Commission disagreed with the Administrative Law Judge was that, even if the issue of retaliatory discharge can somehow be reached, the evidence is inadequate as a matter of law to support a finding that a violation occurred.

Retaliation, like most other forms of discrimination proscribed by the Fair Employment Act, is conduct which the statute condemns solely because of the motivation which underlies it. In the case of retaliation, the motive in question is anger or resentment against a person because the person has opposed a practice which they claimed to have been discriminatory under the Fair Employment Act. In order to violate the prohibition against retaliation, an employer must have a belief that the person retaliated against is raising some kind of claim that discrimination is occurring. If an employer does not have such a belief, it obviously cannot be motivated by such a belief in conduct it undertakes. Thus, it is an essential element of a claim of retaliation that the complainant prove that the employer was aware that the complainant engaged in protected activities. Acharya v. University of Wisconsin (LIRC, January 19, 1982), Hochstadt v. Worcester Foundation for Experimental Biology, 425 F.Supp. 318 (D. Mass.), aff'd. 545 F.2d 222 (1st Cir. 1976). In a number of cases in which an employe has protested an employment action to the employer, but in doing so has not indicated a belief that discrimination is being opposed, courts have found that the employer's reaction to that protest was not prohibited retaliation. Theiss v. John Fabick Tractor Co., 532 F.Supp. 453 (E.D. Mo. 1982), McCluney v. Joseph Schlitz Brewing Co., 728 F.2d 924 (7th Cir. 1984), aff'g. 34 FEP 271 (E.D. Wis. 1982), Moncada v. E1 Paso Natural Gas Company, 40 FEP 556 (W.D. Tex. 1986). See also, Keller and Keller v. City of Brodhead (LIRC, April 29, 1987), to the same effect.

Cangelosi offered no evidence that she ever raised an issue of marital status discrimination, or discrimination of any kind. She merely testified that she "challenged" Larson when he told her that the trip was just for her because she was unmarried, and that they had very heated discussions and fights about her demand for the trip.

From her testimony that she believed that Larson had lied to her, the Commission infers that Cangelosi's principal objection was not that the denial of the trip for two was an act of prohibited discrimination, but that it was a breach of a contract, breaking a promise that Larson had made when he described the prize in the course of announcing the contest. Even if the decision to discharge her arose in part from this opposition, there was no prohibited retaliation for the same reason as that identified by the court in Moncada v. E1 Paso Natural Gas Company, supra, which stated:

"The court is compelled to conclude that, although the plaintiff undoubtedly lodged some complaints about the path her career was taking, she did not complain to company personnel about discrimination of the kind prohibited by Title VII." 40 FEP at 558. (emphasis added)

A similar view was expressed by the district court in McCluney v. Joseph Schlitz Brewing Company, supra:

"Although it can easily be said that the plaintiff's termination resulted from the position he took regarding the transfer decision, the plaintiff has not made a convincing showing that it was his position regarding the discriminatory nature of the transfer decision which brought about his discharge." 34 FEP at 273. (emphasis added)

Attorney's Fees -- Complainant is a prevailing party, notwithstanding the fact that she did not succeed on the claim of unlawful discharge, because she has succeeded on a significant issue in the litigation (the issue of discrimination on the basis of marital status in regard to denial of the prize trip) which achieved some of the benefit she sought in bringing suit. Texas State Teachers' Assn., et al. v. Garland Independent School District, et al., 489 U.S. 782, 109 S.Ct. 1486, 103 L.Ed.2d 866 (1989). However, because the Complainant's success has been only limited, it is appropriate to reduce the allowed fee. Hensley v. Eckerhart, 461 U.S. 424, 103 S.Ct. 1933, 76 L.Ed.2d 40 (1983), Schwantes v. Orbit Resort (LIRC, May 22, 1986). There is no precise formula which must be followed in determining the appropriate reduction, but two approaches that have been recognized as appropriate are to either attempt to identify specific hours that should be eliminated or to simply reduce the award to account for the limited success.

In this case, the Commission has concluded that it is not feasible to specifically identify hours in the Complainant's attorney's fee request that can be eliminated as being attributable to the unsuccessful discharge claim. Therefore, the Commission has determined to reduce the amount of the award to account for the limited success. It is the judgment of the Commission, that an award of one-third of the attorney's fees and expenses sought is appropriate. This reflects the Commission's assessment of the amount of time and effort that were required to properly try and present the case with respect to the denial of the bonus prize as opposed to the case relating to the discharge. The Commission has based this assessment on the quantity of evidence placed into the record on these two issues and on the extent to which Complainant's arguments have focused on them. Additional fees and expenses prayed for in connection with the petition for Commission review have been allowed, but also have been subjected to this same proportional division.

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