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

CHARLES C. WEIER, Complainant

HEIDEN INC, Respondent

FAIR EMPLOYMENT DECISION
ERD Case No. 199601631, EEOC Case No. 26G961123

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 first line of paragraph 9 of the FINDINGS OF FACT, the word "marketing" is deleted and the words "regional sales" are substituted therefor.

2. In the sixth line of paragraph 9 of the FINDINGS OF FACT, the word "months" is deleted and the word "weeks" is substituted therefor.

3. In the last line in paragraph 12 of the FINDINGS OF FACT, the word "by" is deleted and the word "on" is substituted therefor.

DECISION

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

Dated and mailed: February 5, 1998
weierch.rmd : 125 : 9

/s/ David B. Falstad, Chairman

/s/ Pamela I. Anderson, Commissioner

/s/ James A. Rutkowski, Commissioner

MEMORANDUM OPINION

This case involves a claim by Charles C. Weier that the respondent violated the Wisconsin Fair Employment Act by discriminating against him on the basis of his age with respect to compensation, termination of employment and refusal to hire or employ (i.e., refusal to enter into an independent contractual relationship), and by retaliating against him by refusing to enter into an independent contractual relationship because he had opposed a discriminatory practice under the Act.

The administrative law judge concluded after a hearing in the matter that Weier failed to establish a prima facie case of discrimination because of opposition to a discriminatory practice under the Act because he never opposed a discriminatory practice under the WFEA (see conclusion of law no. 4), that he failed to establish probable cause to believe that the respondent discriminated against him because of his age in regard to compensation, termination of employment or by refusing to hire or employ him in violation of the Act, and that the department lacked jurisdiction over the allegations of discrimination by refusing to hire or employ because of age or because of opposition to a discriminatory practice because the position involved an independent contractor agreement and not an employment relationship (see conclusion of law no. 6). The ALJ therefore dismissed Weier's complaint of discrimination. Weier has filed a petition for review by the commission.

The facts of this case can be summarized as follows. Weier, whose date of birth is March 15, 1934, began employment with the respondent in March 1985 as its marketing manager. He was the only full-time salesperson working for the respondent. In 1995 William Jacobson decided to purchase the respondent with the intent of employing his business associate and brother-in-law (Randolph Richardson), and to conduct the sales and marketing efforts through independent contractors working as sales representatives. When he purchased the business, Jacobson was concerned about the fact that fifty percent of the respondent's business was tied up with only one customer (Thermo King) and that this customer had a history threatening to reduce or cease doing business with the respondent.

Upon taking over the business on August 4, 1995, Jacobson told Weier that he was no longer the marketing manager and that Richardson, age 52, was taking over as the general sales manager with supervisory responsibility over him. Also in August 1995, Weier was notified that health insurance premiums would be increasing (effective October 1, 1995). During the latter part of August 1995, Weier was hospitalized for a problem with blood clots.

On November 17, 1995, Jacobson received notice of Thermo King's decision that it was terminating its business relationship with the respondent.

Thereafter, on November 20, 1995, the respondent terminated the employment of Don Davis, a production employe, and on November 27, 1995, the respondent terminated the employment of Weier. Jacobson and Richardson met with Weier on November 27 and told him that his position was being eliminated. Weier was given a letter dated November 27, 1995, which stated that he would be paid for six days of accumulated vacation pay, and which also offered him six weeks of additional benefits (i.e., 6 weeks severance pay) if he signed a general release releasing the respondent from any and all employment or termination-based claims. Receipt of the severance pay was linked to Weier's execution of the release. The letter advised Weier that he should consult with an attorney before agreeing to sign the release. It also advised Weier that if he chose to accept the additional benefits, he had 21 days (i.e., until December 18, 1995) in which to sign and return the release and a letter stating that he had read, understood and agreed with the provisions of the letter. Finally, this letter also advised Weier that he had seven days after signing these documents to revoke them if he changed his mind about receiving the additional benefits. At the November 27 meeting, Jacobson also mentioned that the respondent would like to use Weier as an independent sales agent. However, no details were discussed.

At no time prior to or during the November 27, 1995 meeting did Weier complain to Jacobson or any other management official about any alleged age discrimination, nor did he take any action to oppose any discriminatory practice under the Act.

On or about December 1, 1995, Weier met with Richardson to return files and to discuss the status of some work. Richardson discussed the proposed independent sales agreement and its terms in detail with Weier during this meeting. The respondent offered to enter into a contractual agreement whereby Weier would act an independent manufacturer's representative receiving $2,000 per month draw and a 10 percent commission. Jacobson participated in the discussion regarding the independent contractor work. At this meeting there was again discussion regarding the release.

Weier did not agree to the terms of the independent contractor work or the release. At this meeting Weier complained for the first time that he was not being paid any vacation pay for the time that he had worked after his anniversary date of March 15, 1995. Jacobson refused to adjust the payout of vacation time as he did not believe that vacation pay was due for that period. Weier did not mention or even suggest that he was being discriminated against because of his age or any other basis covered under the Act, however. While there was conflicting testimony, the ALJ found that at the December 1 meeting Jacobson inquired if Weier intended to sign the general release and informed Weier that he did not think there could be an independent sales agreement until the matter of the release was resolved. The ALJ further found, however, that "(t)he Respondent linked the signing of the release to the execution of an independent sales agreement by December 1, 1995, (sic) before they were aware that Weier had consulted an attorney. At the time that the Respondent linked the two agreements, Weier had never complained about alleged age discrimination and had not opposed any discriminatory practice under the Act."

Weier then consulted with an attorney who sent a letter to the respondent dated December 1, 1995, requesting a copy of Weier's personnel file. This letter did not express any concern regarding any particular legal cause of action, and specifically did not reference alleged age discrimination or the WFEA. Jacobson simply presumed that Weier had followed the advice given in the termination letter when he received the letter from the attorney.

Again, although the testimony conflicted about whether the release and the independent contractual agreement were linked, the ALJ found that Weier had contact with the respondent on two subsequent occasions in December 1995 during which the respondent advised him that the matter of the release would have to be resolved before they could proceed with the independent contractor agreement.

On December 12, 1995, the respondent's attorney sent a copy of Weier's personnel file to Weier's attorney.

On December 21, the respondent's attorney faxed a letter to Weier's attorney extending the time in which Weier had to execute the release until 5:00 p.m. on December 22, 1995, and refusing to provide any additional vacation pay.

Weier spoke with Richardson by phone on or about December 22, 1995, advising Richardson at that time that he was very interested in pursuing the independent sales agreement. However, Richardson again stated that the general release had to be executed before there could be an independent sales agreement. This was the last contact that Weier had with the respondent. As of this time, Weier had still never complained that he was being treated differently because of his age, nor had he opposed any discriminatory practice under the Act.

In early 1996, Weier's attorney and the respondent resolved the vacation pay dispute when the respondent agreed to pay Weier additional vacation for the time he worked after his anniversary date. Davis, whose employment the respondent had terminated on November 20, 1995, had also complained about the respondent's failure to calculate his vacation payout for the time he had worked after his anniversary date. Jacobson agreed to pay the one additional vacation day at the time that Davis complained about it because he had also agreed to sign a general release of claims against the respondent at that time. The fact that Weier had not signed the release together with the fact that Weier sought six additional days of vacation compared to one that Davis had sought caused Jacobson not to pay Weier as quickly as he paid Davis.

Weier's petition for review focuses on paragraphs 4 and 6 of the conclusions of law made by the ALJ.

Conclusion of law no. 4 states:

"4. That the Complainant has failed to establish a prima facie case of discrimination because of opposition to a discriminatory practice under the Act because he never opposed a discriminatory practice under the Wisconsin Fair Employment Act."

A prima facie case of retaliation requires: (1) a showing that the individual engaged in statutorily protected expression (i.e., that the individual opposed any discriminatory practice under the Act or made a complaint, testified or assisted in any proceeding under the Act); (2) that there was an adverse action by the employer; and (3) that there was a causal link between the protected expression and the adverse action. (See, for example, Roden v. Federal Express, (LIRC, 6/30/93)).

Further, the commission has held that:

"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. El 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 v. Robert E. Larson and Associates, Inc., (LIRC, 11/9/90).

In the instant case, Weier has argued on appeal that his repeated refusal to sign the release of his employment claims against the respondent showed his opposition to what he believed to be discrimination, and that this refusal together with contacting an attorney because he (Weier) was concerned that he had been discriminated against, established that the respondent was aware of his opposition to (alleged) discrimination. This argument fails. The mere refusal to sign a severance or termination agreement containing a release of any claims against an employer does not constitute "opposition" to a discriminatory practice. Employers are not prohibited from entering into agreements with their employes whereby the employe waives any claim that he or she may have against the employer. Employes are not obligated to enter into such agreements. Weier's contacting an attorney cannot be held to have demonstrated that he opposed a discriminatory practice since the respondent had encouraged him to do so before signing the release. Further, as stated by the ALJ on page 7 of his decision:

"....By his (Weier's) own testimony, he never complained about what he perceived to be age discrimination. He never compared his treatment to younger employees. The mere fact that he had an attorney request his personnel file under a different statutory procedure (Wis. Stat. § 103.13), after the respondent advised him to seek the advice of counsel before signing a release, does not prove that he opposed a discriminatory practice under the Act. To reach that inference, the Administrative Law Judge would have to rely on pure speculation. The standard of probable cause requires more. In addition, there is absolutely no evidence that any opposition was ever communicated in any way to the Respondent."

Also, as stated in the ALJ's decision, (and noted by the respondent on appeal), the respondent had linked the signing of the release to execution of the independent sales agreement before the respondent was aware that Weier had consulted an attorney. Thus, the respondent was not aware of any "opposition" on the part of Weier.

The second focus of Weier's petition for review concerns conclusion of law no. 6 made by the ALJ. This conclusion states:

"6. That the Department lacks jurisdiction over the allegations of discrimination by refusing to hire or employ because of age or because of opposition to a discriminatory practice because the position involved an independent contractor agreement and not an employment relationship."

Citing both Title VII and LIRC case law, Weier asserts that this conclusion is in error. Weier asserts that the United States Supreme Court has held in Robinson v. Shell Oil Company, __ U.S.__ , 117 S.Ct. 843 (1997), that a former employe is entitled to Title VII anti-retaliation protection from acts of the former employer which negatively impacted on the former employe's future employment opportunities. In that case Robinson, whose employment had been terminated by Shell Oil, filed a complaint under Title VII, and while that charge was pending applied for a job with another company. Robinson subsequently brought suit under § 704(a) of Title VII claiming retaliatory discrimination because his former employer gave him a negative reference in retaliation for filing the original complaint. (1)

Weier's reliance on Robinson is misplaced, however, since the precise issue presented in Robinson was simply whether the term "employees," as used in § 704(a), includes former employees such that Robinson could bring suit against his former employer for alleged postemployment retaliation. What the Court held in Robinson was that the term "employees" as used in § 704(a) was included within § 704(a)'s coverage. Thus, Robinson was allowed to proceed with his claim of retaliation against his former employer for allegedly providing a negative employment reference to another company with whom he had applied for a job.

Unlike Robinson, Weier's complaint is not about obtaining employment with the respondent. His complaint is that because of his refusal to sign a release of all claims against the respondent, the respondent retaliated against him by refusing to enter into an independent contractor relationship with him. As stated by the ALJ in paragraph 22 of the findings, "The respondent did not refuse to hire or employ Weier within the meaning of the Act, because the position in dispute did not involve an employer-employee relationship." The ALJ clearly understood, as stated earlier in this paragraph of his findings, that this position "was clearly never intended or understood by either party to be a position of employment with the respondent." Independent contractors are not protected by the Wisconsin Fair Employment Act. Moore v. LIRC, 175 Wis. 2d 561, 499 N.W.2d 289 (Ct. App. 1993).

Weier correctly asserts that the commission has held that "when a retaliatory act negatively impacts (on) a person's employment opportunity, unlawful discrimination within the Fair Employment Act has occurred. Only when the act has nothing to do with an employment opportunity will the retaliatory act be beyond the scope of the WFEA." (emphasis by Weier) Weier cites the commission's prior decisions in Pufahl v. Niebuhr, (LIRC, 8/16/91)("...the commission does not agree that the anti- retaliation provisions of the Act only apply to adverse actions taken by an employer...which are 'directly' related to an individual's employment. An adverse action may in some circumstances be subject to the anti-retaliation provisions of the Act even though its relationship to an employment opportunity is only indirect."), and Seeman v. Universal Foods, (LIRC, 9/22/94)(commission re-examined Pufahl, reaffirming that an employer could violate the Act by retaliating against a former employe, even though its relationship to the employment opportunity is indirect).

Weier argues that his situation is far more direct retaliation than the indirect interference with an employment opportunity approved by the commission in Pufahl and Seeman; that the respondent denied him the opportunity to work for himself as an independent contractor (receiving a $2,000 per month draw and a 10% commission) because he refused to release his age claim.

Further, Weier states that the American Heritage Dictionary of the English Language (1970) defines employment as:

1.a. The act of employing; putting to use or work. b. The state of being employed. 2. The work in which one is engaged; business; profession. 3. An activity to which one devotes time.

Weier argues that because the dictionary definition does not restrict employment to a person on the payroll of another, employment clearly includes self-employment, sole proprietorship, consulting, etc.

These arguments by Weier also fail because the simple fact of the matter is that the future "employment opportunity" involved herein was not that of an employe-employer relationship but that of an independent contractor relationship. As noted earlier, independent contractors are not protected by the Wisconsin Fair Employment Act. Moore, supra. If the relationship contemplated by the parties did not involve an employe-employer relationship "employment opportunity" in the first instance, the respondent could not have retaliated against Weier for opposition to alleged discrimination in violation of the Act by refusing to enter into an independent contractor relationship unless Weier signed the release.

Even assuming that Weier is correct in that the department has jurisdiction over his claim regarding the independent contractor position, the commission disagrees with his assertion that the respondent "retaliated" against him by refusing him the independent contractor position because he refused to release all claims against the respondent. Simply put, at best all that Weier has shown is that the respondent linked the independent sales contractor position with his signing of the release. Weier has failed, however, to establish probable cause to believe that his refusal to sign the release constituted opposition to a discriminatory practice under the Act or that the respondent ever believed that he had raised a claim of discrimination by refusing to sign the release due to the linking of the independent contractor sales position with his signing of the release. As noted by the commission in Pufahl, if an employer does not have a belief that the person allegedly retaliated against is raising some kind of claim that discrimination is occurring, it obviously cannot be motivated by such a belief in conduct it undertakes. This is exactly the situation that was presented here.

Accordingly, there is not probable cause to believe that the respondent retaliated against Weier for opposing a discriminatory practice under the Act.

NOTE: The commission has modified the findings of the ALJ's decision to make them better conform with the evidence.

cc: STEVEN R. OLSON
ANN M. MAHER

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Footnotes:

(1)( Back ) Title VII makes it unlawful "for an employer to discriminate against any of his employees or applicants for employment...because he has opposed any practice made an unlawful employment practice...or because he has made a charge, testified, assisted, or participated in any manner in an investigation, proceeding, or hearing ...." (Section 2000e-3)