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Originally appeared in Labor and Employment Newsletter - February 2002
The United States Court of Appeals for the Seventh Circuit ruled recently that a victim of discrimination who leaves his or her employment as a result of the discrimination must show either an actual or constructive discharge in order to receive the equitable remedy of reinstatement, or back pay and front pay in lieu of reinstatement.
In Hertzberg v. SRAM Corporation, 261 F.3d 651 (7th Cir. 2001), the court reversed back pay and front pay awards because a jury determined that the plaintiff employee did not prove her retaliatory discharge claim.
Reported Harassment Ignored
Ms. Hertzberg claimed that a co-worker repeatedly told her that she was not as qualified as he, that women could not perform job responsibilities as well as men, and that he would take over her job. Ms. Hertzberg complained to her immediate supervisor about the comments. Ms. Hertzberg’s male supervisor put his hand on her knee and told her that he would take care of it. The co-workers’ comments continued after Ms. Hertzberg complained to her immediate supervisor, so Ms. Hertzberg complained to the plant manager about both the co-worker and her immediate supervisor. The co-worker’s comments continued unabated, and Ms. Hertzberg left SRAM.
Constructive Discharge Not Alleged
Ms. Hertzberg filed a two-count complaint in federal district court. One count alleged sexual harassment by the co-worker and Ms. Hertzberg’s supervisor. The other count alleged that SRAM fired Ms. Hertzberg in retaliation for her opposition to and complaints about the "hostile and offensive work environment." Ms. Hertzberg did not, however, allege that she was constructively discharged - that is, she did not allege that her working conditions were so intolerable that she was forced to resign. After a trial, a jury returned a verdict in favor of Ms. Hertzberg on her sexual harassment claim and awarded her $20,000 in punitive damages. The jury returned a verdict for the employer, SRAM, on the retaliatory discharge claim. Despite the jury’s finding in favor of SRAM on the retaliatory discharge claim, the district court granted Ms. Hertzberg equitable relief in the form of over $50,000 in back pay and front pay.
Pay Awards Reversed But Punitives Upheld
The Court of Appeals reversed the district court’s back pay and front pay awards. The court decided that because "[t]he jury rejected Ms. Hertzberg’s retaliatory discharge claim . . . there was no discriminatory discharge on which the award of lost pay could be based." The Court of Appeals affirmed the punitive damages award. The court found that the plant manager knew about SRAM’s anti-harassment policy, but demonstrated a "lack of a good faith effort to insulate Ms. Hertzberg from [the co-worker’s] harassment." The court observed that there was evidence that the plant manager "failed to follow SRAM’s procedure for receiving complaints because he did not put them in writing." The court also observed that Ms. Hertzberg’s supervisor "‘seemed to shrug it off’" when Ms. Hertzberg complained, concluding that "given the constant nature of the harassment and SRAM’s lack of managerial response to the problem, we believe a jury was entitled to conclude that SRAM did not make good faith efforts to implement its sexual harassment policy.
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