SCOTUS Adopts New "Significant Burden" Test for Analyzing Pregnancy Discrimination Act Claims

Practical Law Legal Update 1-606-2326 (Approx. 7 pages)

SCOTUS Adopts New "Significant Burden" Test for Analyzing Pregnancy Discrimination Act Claims

by Practical Law Labor & Employment

Background

Peggy Young worked as a part-time driver for United Parcel Service, Inc. (UPS). She was responsible for picking up and delivering packages. In 2006, Young became pregnant and was told by her doctor that she could not lift packages weighing more than 20 pounds during the first 20 weeks of her pregnancy, or more than 10 pounds during the remainder of her pregnancy. One of the essential functions of Young's job was lifting packages weighing up to 70 pounds. UPS denied Young's requested accommodation for light duty and told Young that she could not work during the duration of her pregnancy because of the lifting restriction.

Under UPS's policies, which were informed by a Collective Bargaining Agreement, UPS accommodated drivers with alternative work assignments when employees experienced a:

Temporary disability resulting from on-the-job injuries.
Loss of Department of Transportation (DOT) certification because of a failed medical exam, a lost driver's license, or a motor vehicle accident.
Permanent disability under the ADA.

UPS did not accommodate requests for light duty for employees in other circumstances, including requests made by pregnant and nonpregnant individuals, such as an employee with a lifting restriction resulting from an off-duty injury. After UPS denied her requested accommodation, Young's division manager made a statement to her that she was "too much of a liability" and could not "come back to work" until "she was no longer pregnant." As a result, Young remained on an unpaid leave of absence during her pregnancy, returning to work after her baby was born.

In 2008, after filing a pregnancy discrimination charge with the EEOC and obtaining a right-to-sue letter, Young sued UPS in federal district court. She asserted claims for disparate treatment under the PDA and failure to accommodate under the ADA (although the ADA Amendments Act of 2008 did not apply to her claim). In arguing that UPS discriminated against her based on her pregnancy, Young relied on both:

"Direct evidence" of intentional discrimination, including the comments made by her division manager.
Indirect evidence of discriminatory animus, based on the fact that several UPS employees had received light-duty accommodations with similar or more severe disabilities, including following injuries, although it was unclear whether the injuries referenced had occurred on or off the job.

UPS moved for summary judgment on both claims.

The district court granted summary judgment to UPS on Young's pregnancy discrimination claim, finding that Young could not show intentional discrimination on the basis of direct evidence, and rejecting Young's argument that she could establish a prima facie case of disparate treatment under the burden-shifting framework found in McDonnell Douglas Corp. v. Green (411 U. S. 792 (1973)). The district court found that the other UPS employees to whom Young compared herself (those that qualified for light-duty under the policies noted above) were too different to qualify as "similarly situated." The district court further found that UPS had a legitimate, non-discriminatory reason for failing to accommodate pregnant women. Finally, the district court dismissed her ADA claim finding that she was not disabled under the statute.

The Fourth Circuit affirmed the grant of summary judgment for UPS on both claims. Young appealed the Fourth Circuit's decision on the PDA claim to the Supreme Court.

On appeal, the parties argued for radically different interpretations the PDA's requirements based on the statutory language of the Act. The PDA, which modified Title VII in its first clause specifies that sex discrimination includes discrimination "because of or on the basis of pregnancy, childbirth, or related medical conditions" (42 U.S.C. § 2000e(k)). The second clause requires employers to treat "women affected by pregnancy . . . the same for all employment-related purposes . . .as other persons not so affected but similar in their ability or inability to work."

The parties disputed the meaning of the second clause. Young contended that the second clause requires employers to accommodate pregnant workers to the same extent as other nonpregnant employees with similar disabling conditions, even if those other nonpregnant employees do not qualify for leave under the employer's policy.

UPS argued for a more narrow reading of the statute, claiming that the second clause simply further defines sex discrimination as including pregnancy, and did not create any obligations to offer more benefits to pregnant employees than it offered to nonpregnant employees.

Outcome

In a 6-3 decision, the Supreme Court vacated the grant of summary judgment for UPS and remanded for further consideration in light of the court's interpretation of the PDA and the new standard it applied to analyzing disparate treatment claims under that statute.

The Majority's Decision

The court based its decision on an in-depth statutory analysis of the PDA. The court rejected both parties' interpretation of the statute, concluding that:

UPS's interpretation was too narrow, as it rendered the first clause, which already defined sex discrimination as including pregnancy discrimination, meaningless.
Young's interpretation was too broad, as it created a "most favored nation" status for pregnant employees, which the statute did not intend, and granted them benefits not available to other similarly situated nonpregnant employees.

The court also refused to "rely significantly" on the EEOC's Guidance on pregnancy discrimination issued in July 2014, based on its:

Timing, as it was issued after the Supreme Court had granted certoriari in this case.
Consistency, as it contradicted positions the government had taken in the past.
Thoroughness of consideration, as it failed to explain the basis of the guidance, or how it read the statute.

The court instead adopted an alternative interpretation, and concluded that a pregnant worker can show disparate treatment through indirect evidence by applying the McDonnell Douglas burden-shifting framework. Using this analysis, the court held that a pregnant employee can state a prima facie claim by showing that:

She belongs to the protected class.
She sought an accommodation.
The employer did not accommodate her.
The employer accommodated others "similar in their ability or inability to work."

Once the employee makes out a prima facie case of pregnancy discrimination, the burden shifts to the employer to justify its legitimate, non-discriminatory reason for denying the pregnant employee's requested accommodation. The justification generally must be based on something other than the added cost or inconvenience of adding pregnant women to the list of accommodated categories.

In response to the employer's legitimate, non-discriminatory reason, a PDA plaintiff can survive summary judgment and reach a jury by providing sufficient circumstantial evidence that:

The employer's policies impose a significant burden on pregnant workers, such as with evidence that the employer:
- accommodates a large percentage of nonpregnant workers; and
- does not accommodate a large percentage of pregnant workers.
The employer's "legitimate, nondiscriminatory" reasons are not strong enough to warrant the burden placed on pregnant workers.
Consideration of the employer's proffered reasons against the burden imposed on pregnant workers gives rise to an inference of intentional discrimination.

Applying its interpretation of the PDA, the Supreme Court remanded the case to the Fourth Circuit to determine whether Young created a genuine issue of material fact about whether UPS's reasons for treating Young less favorably than nonpregnant employees were pretextual. The court included dicta suggesting that Young could survive summary judgment on remand if she could show that UPS accommodated nonpregnant employees' lifting limitations and did not accommodate those limitations for pregnant workers. Moreover, Young could highlight that UPS had multiple policies accommodating nonpregnant employees with lifting restrictions to convince a jury that UPS's reasons for failing to accommodate pregnant employees with similar restrictions were not sufficiently strong, raising an inference of intentional discrimination.

Justice Alito's Concurrence

Justice Alito issued a concurring opinion, agreeing with the result and with the majority's rejection of both UPS's and Young's proposed readings of the PDA's second clause. However, Justice Alito took issue with the idea that the PDA's second clause allows courts to examine whether an employer's accommodation rule is justified when the rule is based on truly neutral grounds. Specifically, Justice Alito did not consider UPS's accommodation rule to be neutral, noting that UPS could not have any plausible reason for treating drivers who had lost their DOT certification more favorably than drivers who were pregnant.

Justice Scalia's Dissent

Justice Scalia issued a sarcastic and critical dissent (joined by Justices Kennedy and Thomas), accusing the majority of creating a new standard that "is as dubious in principle as it is senseless in practice" and created with "only a couple of waves of the Supreme Wand.... Poof!" Scalia argued (similar to UPS) that the PDA's second clause was intended to give clarity to the first clause, and was not rendered meaningless by UPS's interpretation.

Practical Implications

The Supreme Court's decision in Young should lead employers to examine policies that have an impact on pregnant employees. Employers should assess those policies under what appears to be the new test articulated by the Supreme Court, specifically:

Whether the policies impose a significant burden on pregnant employees.
If so, the strength of the employer's justifications for the policies.

Although the precise boundaries of this test remain undefined, employers should generally avoid practices or policies that offer accommodations to many nonpregnant employees without extending those same benefits to pregnant workers, unless they have a sufficiently strong justification (other than cost or convenience) for doing so.

The court's decision also appears to minimize the relevance of the EEOC's 2014 guidance, which, if followed by UPS, would have mandated an accommodation to Young in this case. It remains unclear whether that guidance will be revoked or reissued as a result of this decision. Finally, the court acknowledged that the ADAAA amendments, which include lifting restrictions as a "major life activity," may limit the practical impact of its holding.

Subsequent Proceedings:

UPS changed its pregnancy accommodation policy before oral argument to the US Supreme Court which took place in December 2014. Following remand by the US Supreme Court the parties settled the case in October 2015 (Young v. United Parcel Srvc. of Am., Inc., et al., No. 8:08CV02586 (D.Md. Oct. 1, 2015)).

SCOTUS Adopts New "Significant Burden" Test for Analyzing Pregnancy Discrimination Act Claims | Practical Law