Conditions are ideal for Employment Attorneys
By: Steve Lash Daily Record Legal Affairs Writer, The Daily Record, December 13, 2009A combination of company layoffs, a first-year president determined to enforce laws against job bias and a new statute aimed at protecting women from pay discrimination have made 2009 a boon time for employment attorneys, regardless of whether they represent employers or employees.
Chief among the factors driving up the lawyers’ client base is the bleak domestic economy, which has caused anxiety among companies, fearful of going out of business, and employees, afraid of losing their jobs.
“It’s like a perfect storm,” attorney Kevin C. McCormick said of the confluence of factors driving companies and employees alike to seek counsel.
Though sympathizing with the plight of businesses and their workers, McCormick said the rough economic times have been professionally rewarding for the employment bar.
“There’s always a silver lining for us lawyers,” said McCormick, who represents employers and chairs the labor and employment section at Whiteford Taylor Preston LLP in Baltimore. “Clients will need us more.”
The boom began even before President Barack Obama’s election in November 2008, according to the most recent data released from the U.S. Equal Employment Opportunity Commission.
During the fiscal year that ended Sept. 30, 2008 – a 12-month period of economic turmoil that led to a federal bank bailout – the number of job-bias claims filed with the EEOC skyrocketed 15 percent, to 95,402, from the prior year, the agency stated.
In Maryland, the number of employment discrimination cases filed with the Maryland Commission on Human Relations, which also accepts bias claims in the state, rose 6 percent – to 709 from 663 – during fiscal year 2009, which ended June 30.
Doldrums with a difference
Weak economic times and layoffs are not new. But in earlier doldrums and layoffs, employers and employees alike were more confident that the financial tide would turn and new jobs would be found, employment lawyers said.
That earlier confidence does not apply in the current recession. Companies have continued to layoff workers, and out-of-work employees have not found new jobs as quickly as they did in the past, the attorneys said.
The current economy has created “a palpable sense of anxiety at the employee level that I haven’t seen in 24 years” of practice, said Marc R. Engel, who co-chairs the employment and labor group at Lerch, Early & Brewer Chtd. in Bethesda.
Workers in the past who had been laid off in the past would “pick up their lives and move elsewhere,” he added. “But ‘elsewhere’ is a lot harder to find these days.”
Being the victim of a layoff can also play into a feeling of helplessness and “a real sense … of ‘Where am I going to go?'” Engel said. “They’re unhappy with drawing the short stick” when the employer was deciding whom to let go and are more willing to file a discrimination claim, he added.
“It’s been a dark time for companies,” he said. “You’re having events that give rise to litigation. You’re firing people.”
Furthermore, past layoffs afflicted largely the support personnel. Recent job cuts have struck middle and senior managers, as companies seek to trim expenses by terminating workers with larger salaries.
“In this economy, there are many more higher-paid people facing separation than before,” said attorney Stephen D. Shawe, who advises employers. “I’ve had more discussions with people on the phone about separations and layoffs than I had five years ago.”
Management-level terminations can breed litigation, as managers often have reached age 40 and are protected under the federal Age Discrimination in Employment Act, said Shawe, co-managing partner at Shawe & Rosenthal LLP in Baltimore.
But management is within its rights if those terminations are made for the legitimate purpose of cutting expenses and not as a pretext to fire older workers, Shawe said.
The Supreme Court’s June decision in Gross v. FBL Financial Services Inc. supports Shawe’s view.
In its 5-4 ruling, the high court said employees in ADEA cases have the burden of proving they would not have been fired but for their age. A worker dismissed as part of a company’s valid effort to cut expenses in a lean economy cannot meet that burden, Shawe said.
‘Nowhere else to go’
Some observers expect age discrimination claims to fall in the wake of the Gross decision, while others say the cases will simply move to state court.
But Glendora Hughes, general counsel at Maryland’s Commission on Human Relations, cautioned against making too strong a connection between the poor economy and an increase in discrimination filings.
In a bleak economy, with other job prospects poor, workers are more likely to cling to their current jobs, even if that means enduring discrimination or harassment in the workplace, Hughes said.
Thus, workers who would otherwise file a claim might be “sticking it out rather than complaining” for fear their employer would fire them in retaliation, even though retaliatory discharges are illegal, she added.
These workers face the tough decision of “should I challenge or not, because I have nowhere else to go,” she added.
Even so, she said the current hard times may have led to more job discrimination filings than in the past. With new jobs harder to find, displaced workers are more willing to seek out attorneys – and endure the time and expense of litigation, she said.
“Contrary to what folks think, filing a complaint is a very stressful thing to do,” said Hughes, whose agency receives the initial filings of Maryland workers claiming to be victims of illegal discrimination. “It’s very stressful, it’s very disruptive.”
Attorney Andrew M. Dansicker, who represents workers, said he has seen a 20 percent increase this year in the number of out-of-work employees seeking his counsel on whether they have a discrimination claim.
“There’s a lot of pressure on companies to trim their staffs, so they sometimes will fire people who they shouldn’t be firing or making rash decisions,” said Dansicker, a solo practitioner in Hunt Valley.
Meanwhile, “People are more likely to pursue an EEOC claim or discrimination claim because they’re finding it harder to find replacement employment,” he added. “People are more likely to pursue claims because they can’t find other employment.”
If they do pursue an EEOC claim, they may find the agency more helpful than in the recent past. Obama signed into law a 2009 budget that increased the EEOC’s funding by $15 million, or 4 percent.
The first-year president has also proposed a $40 million boost to the commission’s budget for fiscal 2010, which would bring the agency’s funding total to $367 million.
In another sign that he plans to enforce anti-discrimination statutes vigorously, Obama signed into law – on Jan. 29, his ninth day in office – the Lilly Ledbetter Fair Pay Act.
The law essentially overturns a Supreme Court ruling, and gives women more time in which to sue an employer based on a claim they were not being paid the same as their male colleagues for equal work. Under the old standard, the Supreme Court said, a woman had to file a claim with EEOC within 180 days of the date her discriminatory salary was set. The new law starts the 180-day clock with each discriminatory paycheck.
The economy and the push for greater enforcement has led McCormick, the Whiteford Taylor lawyer, to brief his business clients on the continuing need to comply with federal and state laws prohibiting job discrimination as many contemplate the laying off of workers to cut expenses.
The briefings are intended “just to give them a smack in the head” and say “hey, wake up” to the need to ensure that layoffs are non-discriminatory and do not have a disparate impact on employees protected by federal and state laws.
Engel said he, like McCormick, has “tried to be a little more emphatic” in advising his corporate clients about their obligation not to discriminate in this era of layoffs and a new administration intent on enforcing anti-discrimination laws.
“These statutes can get very nuanced and tedious for people who don’t deal with them on a day-to-day basis,” Engel said of the need for companies to consult with employment attorneys.
Attorney Linda Hitt Thatcher, who represents employees, said the down economy and the lack of employment prospects have led to an increase in the number of people seeking advice from her Greenbelt law firm. Thatcher said she has turned away about 80 percent of those thinking about suing after her firm concluded they do not have a valid discrimination claim.
“Just because there’s been a rise in discrimination claims does not mean that all of those claims are valid,” said Thatcher, founder of Thatcher Law Firm. “Just because you’ve been fired does not mean you’ve been discriminated against.”
But Thatcher quickly noted the 20 percent of those potential clients do have valid claims.
“Discrimination in this country,” she said, “is alive and well.”
Kimberly Atkins of Lawyers USA, a sister paper of The Daily Record, contributed to this article.