The
panel decision denies pregnant employees the benefit of the framework for
pregnancy discrimination claims the Supreme Court set out in Young v. United
Parcel Service, Inc., 575 U.S. 206 (2015). Here, Walmart had no limit on
the amount of light duty it could provide its employees, and it gave light duty
to every employee injured on the job who needed it. At the same time, Walmart
categorically refused to accommodate pregnant employees with light duty for
their pregnancy-related restrictions. Walmart never explained why it denied
accommodations to pregnant employees; instead, it argued only that it had
nondiscriminatory reasons for accommodating occupationally injured employees. The
panel accepted those reasons, even as it acknowledged that Walmart’s refusal
forced some pregnant employees “to make difficult choices between continuing to
work at a job that was becoming physically too demanding, or even dangerous,
and going on unpaid leave for several months.” Op. at 3. Despite the
significant burden that Walmart’s decision imposed on pregnant employees and
the absence of a reason for denying them accommodations, the panel affirmed the
grant of summary judgment to Walmart. In so ruling, the panel created a conflict
with Young and with the Second Circuit’s decision in Legg v. Ulster County,
820 F.3d 67 (2d Cir. 2016). Both conflicts are grounds for rehearing en banc. See
Fed. R. App. 35(b)(1).
Young adapted the three-step McDonnell
Douglas framework for certain claims under the Pregnancy Discrimination Act
(PDA), 42 U.S.C. § 2000e(k), modifying the kind of reasons an employer may
offer for denying accommodations and holding that pregnancy discrimination may
be inferred where there is a substantial burden on pregnant women that is not
justified by those reasons. But, contrary to Young, the panel never
required Walmart to explain why it denied accommodations to pregnant employees,
instead allowing Walmart to articulate only a kind of reason Young
barred. And, unlike the Second Circuit, the panel minimized the significant burden
the categorical exclusion of pregnant employees from a light duty program can
impose. The panel then never considered whether Walmart’s asserted reasons were
sufficiently strong to justify the burden on pregnant women, instead dismissing
that burden as merely a result of Walmart implementing its policy of accommodating
employees injured on the job.
These
conflicts present questions of exceptional importance, warranting en banc
review to clarify the proper application of Young’s adapted framework and
ensure that pregnant women receive the protections the PDA provides.
The EEOC
alleged that Walmart discriminated against pregnant employees at its
distribution center in Menomonie, Wisconsin, by refusing to accommodate them
even as it accommodated employees injured on the job. Walmart’s “Temporary
Alternate Duty” Policy (TAD Policy) allowed workers with medical restrictions
from occupational injuries to work light duty with full pay. Op. at 2-3. Walmart
gave 100 TAD Policy assignments to 89 employees with occupational injuries at
the distribution center between September 1, 2014 and October 15, 2017. R.204
at 5. During that same period, Walmart did not deny an accommodation to any
employee injured on the job. Id. Walmart also admitted that it had no
limit on how many employees it could accommodate through the TAD Policy. Id.;
R.172 at 6. Yet Walmart did not offer pregnant workers light duty, instead
making pregnant employees with lifting restrictions take unpaid leave. Op. at
3.
The EEOC
sought relief for women harmed by Walmart’s policy of not accommodating pregnant
employees with light duty. As the panel recognized, some women had to make
“difficult choices” between working physically demanding “or even dangerous”
jobs and losing their income. Op. at 3. Many of these women tried to work as
long as possible. Cassandra Lein delayed telling Walmart about her medical
restrictions until “she ‘was getting a feeling in [her] side,’ and the pain was
exacerbated by her work.” Id. at 4 (alteration in original). As she
feared, Walmart then placed her on unpaid leave, leaving her “out of a job.” Id.
Similarly, Evelynn Welch “begged for light duty” when her regular duties became
too strenuous. Id. But her boss denied her request, so she worked “until
she started bleeding and the fetal heart rate began to drop.” Id.
The
district court granted Walmart’s motion for summary judgment.
Op. at 5. Purporting to apply Young’s modified three-step framework, it held
that the EEOC met its prima facie case at step 1 and it appeared to assume
Walmart had satisfied step 2 by offering a legitimate, nondiscriminatory reason.
R.204 at 15-27. Turning to step 3, the district court held that the EEOC had
not established a significant burden on pregnant employees even though it
showed Walmart accommodated 100 percent of occupationally injured employees
while denying those same accommodations to pregnant employees. Id. at
22-26. It concluded that “[a]part from the TAD policy’s exclusion of pregnant
workers, plaintiff has not presented sufficient evidence to call into question
defendant’s motives for not offering pregnant employees light-duty work.” Id.
at 26.
The panel affirmed. After noting that Walmart conceded
the prima facie case at step 1 on appeal, the panel disagreed with the EEOC’s
argument that Young’s step 2 required Walmart to explain why it did not
accommodate pregnant employees. Op. at 9, 12-13. It instead held that accommodating
employees with occupational injuries “pursuant to a state worker’s compensation
law is a legitimate, nondiscriminatory justification for denying accommodations
under the TAD Policy to everyone else, . . . including pregnant women.” Id.
at 12 (internal quotation marks omitted). And, at step 3, the panel held that
the EEOC cannot establish a significant burden on pregnant employees by showing
that Walmart “implements its TAD Policy consistently with the justification for
the policy that is legitimate and nondiscriminatory.” Id. at 15. It
declined to follow the Second Circuit’s analysis of Young’s step 3 in Legg
v. Ulster County, 820 F.3d at 75-76, because it believed doing so would “be
difficult to reconcile with Young’s rejection of the
‘most-favored-nation’ theory of pregnancy discrimination.” Op. at 17 (reading Legg
as instead resting on evidence of confused and shifting rationales).
Young interpreted the Pregnancy
Discrimination Act’s command that employers treat pregnant employees “the same
for all employment-related purposes . . . as other persons not so affected but
similar in their ability or inability to work” as a direct repudiation of the
Supreme Court’s earlier approval of a disability benefits plan that excluded
pregnancy. 42 U.S.C. § 2000e(k); Young, 575 U.S. at 227-28. To give
effect to that repudiation, Young adapted the three-step framework from McDonnell
Douglas Corp. v. Green, 411 U.S. 792, 803-04 (1973). Relevant here, at step
2, Young required the employer to offer a legitimate, nondiscriminatory
reason for excluding pregnant employees. 575 U.S. at 229. Then, at step 3, Young
held that, although a plaintiff may offer traditional evidence of pretext, a
plaintiff may also show that “the employer’s policies impose a significant
burden on pregnant workers, and that the employer’s legitimate, nondiscriminatory
reasons are not sufficiently strong to justify the burden, but rather—when considered along with the burden imposed—give rise to an
inference of intentional discrimination.” Id. (internal quotation marks
omitted).
The
panel decision functionally rejected both modifications and created a conflict
with the Second Circuit’s application of Young’s final step in Legg
v. Ulster County, the only other circuit decision addressing the modified
step 3 analysis. En banc review is necessary to address these conflicts and
ensure pregnant employees receive accommodations consistent with Young
and the PDA.
I.
The panel’s decision conflicts
with the Supreme Court’s decision in Young, which modified the reasons
employers may offer for denying accommodations to pregnant employees.
Young adapted the McDonnell Douglas
framework to reflect a basic objective of the PDA: overturning the reasoning
and result of the Court’s earlier decision in General Electric Co. v.
Gilbert, 429 U.S. 125 (1976). Young, 575 U.S. at 227-28. At step 2, Young
emphasized the changes that objective made to the reasons employers may offer. Id.
at 229. Yet the panel decision here allowed Walmart to bypass those
changes, instead finding Walmart satisfied step 2 with a reason that, as in Gilbert,
explained why Walmart accommodated some employees rather than why it excluded
pregnant employees from those accommodations.
In Gilbert,
the Supreme Court embraced a disability benefits plan that covered nonoccupational
sickness and accidents but denied benefits to pregnant employees. Young,
575 U.S. at 227. Gilbert, according to Young, treated the plan as
nondiscriminatory because “there was ‘no risk from which men are protected and
women are not’” and the plan’s coverage distinction was not “‘a subterfuge’ or
a ‘pretext’ for engaging in gender-based discrimination.” Id. (quoting Gilbert,
429 U.S. at 136, 138). Young repudiated that approach, adapting the McDonnell
Douglas framework to serve Congress’s unambiguous intent in passing the PDA
“to overturn ‘both the holding and the reasoning of” Gilbert. Id.
at 226-29 (quoting Newport News Shipbuilding & Dry Dock Co. v. EEOC,
462 U.S. 669, 678 (1983)).
Young repeatedly referenced this objective
as it adapted step 2. Now, at step 2, an employer may offer legitimate, nondiscriminatory
reasons for denying accommodations to pregnant employees; but, “consistent with
the Act’s basic objective,” there are limits on the reasons that employers can
offer. Id. at 229. Employers cannot normally “claim that it is more
expensive or less convenient to add pregnant women to the category of those . .
. whom the employer accommodates.” Id. And the reason employers may not
do so is that “the employer in Gilbert could in all likelihood have made
just such a claim.” Id.
Relatedly,
Young adapted the relationship between steps 2 and 3: while a plaintiff
may offer traditional evidence of pretext, a jury could also infer pregnancy
discrimination from a significant burden on pregnant employees if the
employer’s reasons were not sufficiently strong to justify that burden. Id. The
Court concluded that these adaptations—specific to the PDA—were “consistent
with Congress’ intent to overrule Gilbert’s reasoning and result.” Id.
at 230.
In
adapting the McDonnell Douglas framework—including the changes to step 2
and step 3—Young juxtaposed its approach with the interpretations
advanced by UPS and the dissent. UPS and the dissenting justices interpreted the
relevant statutory language to “define[] sex discrimination to include
pregnancy discrimination,” Young, 575 U.S. at 226, and to mean that,
“[b]ecause UPS treated petitioner the same as it did other employees with
similar lifting restrictions resulting from an off-the-job injury or condition,
UPS did not discriminate against petitioner on account of her pregnancy.” Brief for Respondent, Young v. United Parcel Serv.,
Inc., 575 U.S. 206 (2015) (No. 12-1226), 2014 WL 5512140, at **9-10; Young,
575 U.S. at 243-44 (Scalia, J., dissenting) (similar). Young rejected
that approach, 575 U.S. at 230, and, as it did so, it modified the McDonnell
Douglas framework to require the employer to articulate something more than
that it applied a purportedly neutral policy of accommodating some employees. See
id. at 229 (“The employer may then seek to justify its refusal to
accommodate the plaintiff by relying on ‘legitimate, nondiscriminatory’
reasons for denying her accommodation.”) (emphases added); see also
id. at 231 (explaining that “Congress’ intent in passing the Act was to
overrule the Gilbert majority opinion, which viewed the employer’s
disability plan as denying coverage to pregnant employees on a neutral basis”).
The
panel recognized that Young adapted the McDonnell Douglas
framework, Op. at 7-9, but the panel did not require Walmart to explain why it
denied accommodations to pregnant employees. Instead, the panel allowed Walmart
to satisfy step 2 with a reason for providing benefits to other workers: their
occupational injuries brought them within a workers’ compensation program that
complied with state law, reducing Walmart’s costs and legal liability. Op. at
11. But the record shows that Walmart had an unlimited ability to provide light
duty assignments, see R.204 at 5, so providing light duty to employees
with occupational injuries does not explain Walmart’s choice not to accommodate
pregnant employees.
The panel
thus allowed Walmart to satisfy step 2 with a reason that is the kind of
explanation the employer in Gilbert could have offered. Gilbert
allowed the benefits plan to stand because, as Young noted, it distinguished
between employees on neutral grounds—accident and sickness—rather than
pregnancy. 575 U.S. at 227. The panel here, meanwhile, blessed Walmart’s
similar reliance on a light duty program that Walmart opted to adopt to
implement a state worker’s compensation law, stating that Walmart chose “for
sound reasons to offer a benefit to a certain category of workers, those
injured on the job, without intending to discriminate against anyone else . . .
to whom its reasons did not apply.” Op. at 13. Although Young instructs
that employers cannot rely on reasons the employer in Gilbert could well
have offered, the panel nevertheless allowed Walmart to satisfy step 2 without
explaining why it chose not to accommodate pregnant employees.
II. The panel’s decision conflicts with the last step of Young’s
modified framework, which balances any significant burden on pregnant
employees against the employer’s reasons, and with the Second Circuit’s
application of that step.
The
panel failed to follow Young’s modified step 3 by misconstruing the
showing required for a “significant burden” and by not testing the strength of
Walmart’s justification against the burden here. Young held that a
plaintiff may create a jury question at step 3 with evidence “that the
employer’s policies impose a significant burden on pregnant workers” and that
the employer’s reasons “are not sufficiently strong to justify the burden.” 575
U.S. at 229. The Second Circuit is the only other circuit to apply Young’s
step 3, and its decision in Legg, like the panel decision here, involved
light duty provided to those injured on the job. 820 F.3d at 70-71. Unlike the
panel decision, Legg held that the plaintiff could show a significant burden
when pregnant women were categorically excluded from light duty and that a jury
could find the employer’s reliance on a state worker’s compensation law did not
justify that burden on pregnant women. Id. at 75-78. The panel here
veered away from Young and declined to follow Legg, instead holding
that a categorical exclusion did not impose a significant burden and omitting
the required balancing of the burden on pregnant employees against the
employer’s reason for refusing to accommodate them. These irreconcilable
inconsistencies with Young and Legg warrant en banc review.
The
panel first created a conflict at step 3 by discounting the EEOC’s argument
that a jury could find significant burden because Walmart categorically
excluded pregnant employees from light duty accommodations. Op. at 15. As the
Second Circuit held, a jury could find a significant burden where “the [employer]
categorically denied light duty accommodations to pregnant women.” 820 F.3d at
75. Indeed, the Second Circuit found a categorical exclusion when only one out
of 176 employees was pregnant and denied an accommodation, even without
evidence of how many occupationally injured employees were accommodated; non-pregnant
employees “at least were eligible” for accommodation while “the [employer] failed
to accommodate 100% of its pregnant employees.” Id. at 76. The Second
Circuit also found evidence of a significant burden when the plaintiff worked
“until she suffered a serious health scare and decided to take leave from her
job.” Id.
Here, the
record contains ample evidence of a significant burden, including both the
categorical exclusion of pregnant employees and the profound effect that
exclusion had on those employees. Walmart did not dispute that, during the
relevant time, it accommodated 100% of the employees who requested light duty
for occupational injuries (89 employees) while it denied light duty to 100% of
the pregnant employees (at least 13 employees) who were similar in their
ability or inability to work. See R.204 at 2, 5, 16; see also R.142
at 11. Further, just as in Legg, pregnant employees here risked their
health—as well as their pregnancies—to avoid unpaid leave. See Op. at 4.
The
panel gave no credence to either category of evidence. It called the EEOC’s categorical
exclusion argument “circular” and held that “[t]he EEOC cannot satisfy its
burden at step three of the Young analysis by pointing to numbers
showing only that Walmart actually implements its TAD Policy consistently with
the justification for the policy that is legitimate and nondiscriminatory.” Op.
at 15. And the panel never considered whether the evidence of the personal
burdens imposed on pregnant workers denied light duty would support a jury’s
finding of significant burden. The panel thus held that a policy that excluded
all pregnant employees—and led at least one pregnant employee to work until she
bled—imposes no significant burden if the burden is imposed for an allegedly nondiscriminatory
reason. See Op. at 15. But that is inconsistent with Young. The
employer’s reasons are weighed against the burden; they do not limit the
evidence of the burden itself. See Young, 575 U.S. at 229; Legg, 820
F.3d at 76-77. By holding otherwise, the panel contravened both Young
and Legg.
After erring
on significant burden, the panel next disregarded the need to balance the
burden against the strength of the reason offered for denying accommodations to
pregnant employees. Young requires courts to weigh the burden on
pregnant employees against the strength of the employer’s justification, 575
U.S. at 229, and the Second Circuit held that a jury could find an employer’s
reliance on a worker’s compensation statute was not strong enough to justify the
burden imposed.
Legg, 820 F.3d at 77. The Second Circuit reasoned that “nothing in the
statute prevented them from offering the same accommodations to pregnant
employees.” Id. It further held that a jury could find the reliance on that
state law could mean that “cost was a factor,” despite Young’s rejection
of cost as a legitimate reason for denying accommodation in most circumstances.
Id. (noting that, because of the statute, “the defendants lacked the
same financial incentive to continue to employ pregnant employees in some
capacity and had a countervailing incentive to replace them”); see also
Young, 575 U.S. at 229 (cost normally cannot be the reason pregnant
employees are excluded from accommodation). The panel recognized Legg’s
holding, but declined to follow Legg in that analysis. Op. at 16-17.
The
panel incorrectly distinguished Legg as relying on “evidence of confused
and inconsistent rationales,” id. at 17, but Legg treated
that evidence as an independent path to pretext, 820 F.3d at 75. Legg began
its analysis of inconsistent explanations by noting, “[f]irst, even
before Young, a plaintiff could establish pretext and
intentional discrimination by pointing out significant inconsistencies in the
employer’s justification.” Id. It held that a jury could find such
inconsistencies in the record. Id. Then—and only then—did it address Young’s
modifications to step 3, separately holding that, “[s]econd, Legg has offered
sufficient evidence to proceed to trial under the framework articulated
in Young.” Id.
The
panel appeared to conflate these independent holdings because it believed that a
more straightforward reading of Legg would lead to the “‘most favored
nation’ status for pregnant employees” that the Supreme Court disclaimed in Young.
Op. at 17. In doing so, the panel misunderstood Young’s interpretation
of “most favored nation.” In Young, the petitioner argued for an
interpretation of the PDA that would find liability whenever an employer denied
accommodations to pregnant employees and accommodated workers that were similar
in their ability or inability to work to those pregnant employees—no matter the
reason for the denial. 575 U.S. at 220-21. The Supreme Court “agree[d] with UPS
to this extent: We doubt that Congress intended to grant pregnant workers an unconditional
most-favored-nation status.” Id. at 222 (emphasis added). In other
words, the Supreme Court rejected an approach that would impose liability based
only on the denial of accommodation without considering whether the denial
imposed a significant burden on pregnant employees and, if it did, weighing that
burden against the strength of the reason the employer offered for denying the accommodation.
The
Second Circuit did not adopt an unconditional approach, and it did not hold that
employers must offer accommodation without any assessment of significant burden
or the reason for distinguishing between pregnant employees and accommodated
employees. See Legg, 820 F.3d at 76-77. Instead, the Second Circuit
faithfully applied Young’s modified step 3 and considered both the
burden and the reason the employer offered; it simply held that a jury could
find a significant burden and the employer’s reason insufficiently strong to
justify the burden. See id. The EEOC similarly did not argue for a “most
favored nation” approach, asking instead that the panel follow step 3 as it was
set out in Young and applied in Legg. The panel did not do so,
creating an irreconcilable conflict on a question of exceptional importance
that warrants en banc review.
The
conflict the panel created left pregnant women an unduly narrow path to
accommodation within this Circuit. Indeed, the panel’s decision parallels the
very cases Young cited as causing uncertainty about the scope of the
PDA. In those cases, courts often allowed employers to deny accommodations to
pregnant employees that they provided to employees injured on the job. See Young,
575 U.S. at 218 (collecting cases); see also, e.g., Young v. United
Parcel Serv., Inc., 707 F.3d 437, 450 (4th Cir. 2013) (condoning employer’s
“neutral, pregnancy-blind policy” of giving light duty to, among others,
employees injured on the job); Serednyj v. Beverly Healthcare,
LLC, 656 F.3d 540, 548 (7th Cir. 2011) (denying claim because
employer “treat[ed] nonpregnant employees the same as pregnant employees—both
are denied an accommodation of light duty work for non-work-related injuries”).
The panel’s decision echoes these earlier cases, notwithstanding Young’s
modified framework. That narrowed path to accommodation will impose a significant cost on
pregnant employees. One survey before Young estimated up to 250,000
pregnant women were denied accommodations annually.
And those experiences can have real and deleterious effects, with a link
between experiencing pregnancy discrimination and “lower birthweights, lower
gestational ages, and increased numbers of doctor visits for babies.”
The
panel’s erroneous decision heightens the risk that more pregnant employees will
be subject to these harms. And it allows employers to deny those accommodations
without answering a simple and direct question: “why, when the employer
accommodated so many, could it not accommodate pregnant women as well?” Young,
575 U.S. at 231.
For all
these reasons, the EEOC asks the Court to grant rehearing en banc.
Respectfully submitted,
gwendolyn young reams
Acting General Counsel
JENNIfer s. goldstein
Associate General
Counsel
ANNE NOEL OCCHIALINO
Acting Assistant General
Counsel
/s/ James Driscoll-MacEachron
JAMES DRISCOLL-MACEACHRON
Attorney, Appellate
Litigation Services
Office of General
Counsel
Equal Employment
Opportunity
Commission
131 M St. NE, Fifth
Floor
Washington, DC 20507
(602) 661-0014
james.driscoll-maceachron@eeoc.gov
September 30, 2022
