2019 Missouri, Kansas, and Oklahoma Employment Law Year End Review

Missouri

(January 7, 2020) - Missouri legislators were silent on employment and labor law in 2019, neither presenting nor enacting any legislation in the area. The Missouri Supreme Court, on the other hand, actively handed down rulings in labor and employment.

The Missouri Human Rights Act and LGBTQ+ in 2019

In 2018, the Missouri General Assembly introduced, but did not pass, SB 753 which would have barred discrimination based on sexual orientation and gender identity. Failing to pass this bill indicates that the General Assembly agreed with court decisions finding there are no protections from discrimination based upon sexual orientation or gender identity in the Missouri Human Rights Act. See, e.g., Pittman v. Cook Paper Recycling Corp., 478 S.W.3d 479, 483 (Mo. Ct. App. W.D. 2015); R.M.A. v. Blue Springs R-IV School District, 2017 Mo. App. LEXIS 716, (Mo. Ct. App. July 18, 2017) (vacated and transferred by 2018 Mo. LEXIS 5) (discussed further infra). These questions are pending before the United States Supreme Court.

In February 2019, in Lampley v. Missouri Commission on Human Rights, the Missouri Supreme Court revisited this dead 2018 bill’s topic area and made a ground-breaking ruling. A lower court held that the Missouri Human Rights Act does not include claims for sex discrimination based upon sexual orientation and extended that rationale to include claims for discrimination based upon sex stereotyping. The Court, writing that “sex discrimination is discrimination, it is prohibited by the [Missouri Human Rights] Act, and an employee may demonstrate this discrimination through evidence of sexual stereotyping,” held that the Commission improperly characterized Lampley’s claims as sexual orientation discrimination. The Court relied on a sex stereotyping standard rather than creating a new common law rule for discrimination on the basis of sexual orientation. This comports with the 2018 General Assembly’s rejection of these protections. At the charge phase, the Commission declined to investigate Lampley’s claims because it found them to be based on his sexual orientation, which is not provided by the Act. See Pittman v. Cook Paper Recycling Corp., 478 S.W.3d 479 (Mo. App. W.D. 2015).

In a similar vein, the reborn R.M.A. v. Blue Springs R-IV School District case gave credence to transgender discrimination claims. R.M.A. alleged that Defendants (the district and school board) unlawfully discriminated against him on the basis of sex in violation of the Missouri Human Rights Act. R.M.A. alleged that his legal sex is male and that, by denying him access to the boys’ restrooms and locker rooms, Defendants discriminated against him in the use of a public accommodation “on the grounds of his sex.” A lower court dismissed R.M.A.’s action with prejudice for failure to state a claim, and the Missouri Supreme Court vacated that ruling, remanding the action for further proceedings.

Estop That Claim!

Matthew Vacca, an Administrative Law Judge for the Workers’ Compensation Division, filed for divorce and asked for maintenance from his wife because he was unable to work. Looking for a “Buy One, Get One” deal, he also filed a lawsuit against his employer for retaliation and wrongful termination because he believed he was capable of continuing to work with accommodation for 20 more years. The trial court refused to apply judicial estoppel, which prevents parties from making inconsistent statements to two courts. The Missouri Court of Appeals agreed with the trial court. The Missouri Supreme Court, in Vacca v. Missouri Department of Labor & Industrial Relations, Division of Workers’ Compensation, reversed that ruling holding that application of judicial estoppel has no prerequisites and that defendants should be allowed to assert the defense.

Missouri on Arbitration Agreements

In a win for businesses employing arbitration agreements, the Missouri Supreme Court held that an arbitration agreement between Dollar General and two of its employees is enforceable. See State ex rel. Jesse Newberry v. The Honorable Steve Jackson, SC96985 (Mo. Banc. May 21, 2019); State ex rel. Becky Lowrance v. The Honorable Steve Jackson, SC96986 (Mo. Banc. May 21, 2019) (both cases consolidated before the Court). When Dollar General discharged Jesse Newberry and Becky Lowrance, they filed charges of discrimination. Dollar General filed motions to compel arbitration and stay any other proceedings. The circuit court sustained Dollar General’s motions, and the Supreme Court agreed in the face of Newberry and Lowrance’s lack-of-consideration arguments.

Kansas

Kansas Legislature

Governor Laura Kelly passed a total of 66 bills in 2019 and did not veto any bills that passed her desk. These bills did not have a significant impact on Kansas labor and employment laws. However, the Kansas Supreme Court handed down a decision this last year that will likely have wide ranging impacts.

Damage Caps

The Kansas Supreme Court had a busy session this last year. Of note was the Kansas Supreme Court’s decision removing Kansas’ statutory damage cap in personal injury claims. In Hilburn v. Enerpipe Ltd., 309 Kan. 1127, 442 P.3d 509 (2019), the Court held that the statutory non-economic damages cap for personal injury cases violated the Kansas Constitution. This is important because non-economic damages, such as pain and suffering, were previously capped by legislature at $250,000. Although the Court restrained their decision to personal injury cases, their reasoning can also be applied to every cause of action that existed at common law, meaning this decision is likely to have wide-ranging implications that are currently unknown. Employers and insurers should be wary, as the reasoning applied in Hilburn could be applied more broadly and increase the potential liability in a multitude of ways. Regardless, there is no case in the works looking to expand Hilburn’s reach at this time, however employers and insures should reexamine their liability limits and potential risk.

Clients need to be on the lookout in the near future for the Kansas Legislature to address the ruling in Hilburn. The Legislature indicated they intend to address this ruling sometime in 2020, which would need to take the form of an amendment to the Kansas Constitution. Because it could take some time for an amendment to pass, clients are strongly encouraged to keep special eye on any cases or claims, especially personal injury claims, they handle or will handle in Kansas in the coming months and years.

School Finance

The Kansas Supreme Court also heard oral arguments in 2019 in the continuing saga of the “School Finance,” or Gannon, line of cases. Gannon v. State, 309 Kan. 1185, 1186, 443 P.3d 294, 295 (2019). The Kansas Constitution requires that the Legislature make “suitable provision of the finance of the educational interests of the state.” Kan. Const. Art. 6, § 6(b). The Court has interpreted this to mean that the State must adequately and equitably fund public schools, which has resulted in much litigation in the last few years. In this iteration of Gannon, the Court finally approved of a funding plan passed by the Kansas Legislature which added an additional $90 million in annual spending to account for inflation. The Court retained jurisdiction to readdress the issues presented in the case if necessary.

Retirement of Kansas Justices

In the last year, two Kansas Supreme Court justices announced their retirement. This has obvious importance, which is demonstrated by the discussion of Hilburn above. Governor Kelly has not announced replacements for Chief Justice Lawton Nuss and Justice Lee Johnson, but her nominations are expected to be coming soon. We will be on lookout to see how the new justices could impact Kansas laws.

Oklahoma

Workers’ Compensation – Retaliation: House Bill 2367

On May 28, 2019, House Bill 2367 was signed into law. The legislation makes changes to Oklahoma’s workers’ compensation system. The bill removes the cap on damages a plaintiff may recover, as long as those damages are “reasonable,” and allows an employee to recover punitive damages not to exceed $100,000. It also allows the prevailing party to recover costs and reasonable attorneys’ fees.

Additionally, the bill returns jurisdiction to the district courts to hear and decide workers’ compensation retaliation claims. This took effect immediately. The house bill has no express declaration of retroactivity and therefore applies to alleged retaliation occurring after May 28, 2019.

Defenses to EEOC Claims: Lincoln v. BNSF Ry. Co., 2018 U.S. App. LEXIS 22930 (10th Cir. 2018)

The Tenth Circuit changed course to allow employment bias cases to move forward without a prior filing with the U.S. Equal Employment Opportunity Commission (EEOC). This signaled an abandonment of “nearly 40 years of precedent” that required plaintiffs to timely file a complaint with the EEOC prior to availing themselves of the courts. Failure to file with the EEOC can still be used, just not in the same way. As the court noted, such a failure to file with the EEOC can still be raised as an affirmative defense.

Lincoln v. BNSF involved two employees at BNSF Railway Company (BNSF) that had partial, permanent disabilities resulting from a tank car accident several years ago. The disabilities prevented them from performing any work outside. When BNSF learned of these restrictions, the workers were removed from their posts as Maintenance of Way workers, which entailed outside work. The two employees subsequently applied for over 20 jobs within BNSF. They were not selected for any of the positions they applied for. The two men then filed charges with the EEOC and OSHA and made requests for additional positions with BNSF. Following BNSF’s rejection of those additional applications, they filed complaints alleging the following: (1) discrimination under the Americans with Disabilities Act (ADA), (2) failure to accommodate under the ADA, (3) retaliation under the ADA, and (4) retaliation under the Federal Railroad Safety Act (FRSA). The district court dismissed much of the complaint based on the precedent that an EEOC filing is a jurisdictional prerequisite to suit. The district court also granted summary judgment on many of the claims that survived the jurisdictional ruling, concluding that the two men were “neither qualified […] nor established an inference of discrimination” relative to the decision not to hire.

On appeal, the two men challenged the district court ruling. After polling the full court, the Tenth Circuit overturned the precedent and concluded Title VII of the Civil Rights Act “makes no mention of any requirement to exhaust administrative remedies[…] before bringing suit.” Failure to exhaust such remedies does not deprive the federal courts of jurisdiction over a claim. The case was affirmed in part and reversed in part, and remanded to the district court to decide if the lack of EEOC filing defense was waived.

This means that the plaintiff’s failure to file with the EEOC is now an affirmative defense for the defendants in the Tenth Circuit, as opposed to a jurisdictional prerequisite. It is now more important than ever to raise a lack of timely filing with the EEOC as an affirmative defense at the offset of a case. Before the decision, defendants could bring up this defense at any point in the trial, as subject matter jurisdiction can be challenged any time prior to a final judgment. But now, with the changes made as a result of this ruling, if it is not raised as an affirmative defense at the onset of the case then it is waived.

Harassment – Because of Sex: Childers v. Bd. Of Commissioners of Oklahoma Cty., No. CIV-19-460-F, 2019 WL 4060877, at *1 (W.D. Okla. Aug. 2019)

Mr. Childers was a former employee of the Board of County Commissioner of Oklahoma County. He filed a charge and a petition against his former employer, stating he was subjected “to a series of frequent, unwelcome sexual innuendo, accusations and harassment by his manager/supervisor.” He also claimed the harassment created a hostile work environment. The Board moved to dismiss the petition because it failed to state Title VII claims regarding a sexually hostile work environment and retaliation, and because the Oklahoma Anti-Discrimination Act (OADA) claims failed for the same reason as a matter of law. The court dismissed the OADA claims without prejudice for lack of jurisdiction. It also dismissed the Title VII claims without prejudice under Rule 12(b)(1) because the court found that plaintiff's allegations were not sufficient to establish that the alleged harassment was so severe or pervasive as to alter a term, condition, or privilege of the plaintiff’s employment and create an abusive working environment. The court did grant the plaintiff leave to file an amended complaint to state a plausible Title VII sexually hostile work environment claim.

The court reasoned that the Tenth Circuit emphasized that “even for same-sex sexual harassment claims, 'f the nature of an employee's environment, however unpleasant, is not due to [his] gender, [he] has not been the victim of sex discrimination as a result of that environment.” The sexual harassment suffered by plaintiff did not create a hostile environment and was not enough to plead a plausible claim of harassment on the basis of sex.