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Donathan v. Oakley Grain, Inc., No. 15-3508 (8th Cir. June 28, 2017)

The Eighth Circuit holds that a granary employee who complained about sex discrimination in her paycheck - only to have her manager initiate her layoff literally minutes later - was entitled to have a jury decide whether she suffered retaliation under the Equal Pay Act, Title VII and the Arkansas Civil Rights Act.

Donathan v. Oakley Grain, Inc., No. 15-3508 (8th Cir. June 28, 2017): Ms. Donathan, a full time employee, discovered that other workers at different company facilities - including her own brother - were supposedly getting "harvest and safety" cash bonuses, and she was not. So on Thursday, January 23, 2014, she sent an email to president Dennis Oakley which state that "I see no difference in my position [at Yellow Bend] and the ones performed by the grain department at Pendleton for example except the fact that I am female."

The email allegedly triggered the following sequence of events:

"Dennis Oakley forwarded the email to Porter about ten minutes after Donathan sent the email. Dennis Oakley then called [facility manager] Porter who had not yet read the email. After Porter took a moment to read Donathan's complaint, the men discussed the complaint. Porter asserts that, during the phone call, he told Dennis Oakley he was going to lay off employees to save money after finishing the intake of corn. According to Porter's deposition in this case, the Yellow Bend facility was to receive the final truckloads of corn from an outstanding order; Porter expected to complete that order soon; and a work slowdown was anticipated following completion of that order."

Eight days later, on Friday, January 31, 2014, five employees including the plaintiff were laid off. Of the five, three were seasonal employees and one reportedly had performance problems. Ms. Donathan had survived prior layoffs, but not this one. The three seasonal employees were recalled the very next business day, after Oakley Grain supposedly received a "surprise" order. The granary hired a replacement for Ms. Donathan.

In the district court, the judge granted summary judgment on Ms. Donathan's sex discrimination and retaliation claims. On the latter, the judge held that the employer advanced a valid, non-pretextual reason for firing the plaintiff: "because Donathan alone had failed to finish the workday on the Friday of the terminations."

The Eighth Circuit, 2-1, reverses. It holds that the record establishes at least a prima facie case that the company fired Ms. Donathan in retaliation for the sex-bias complaint and that a jury could also find the employer's alternative explanation pretextual.

The evidence of causation, the panel majority holds, is enough to shift the burden of explanation to the employer. In particular:

"Donathan was terminated from her office position even though Oakley Grain had not included the office position in its seasonal layoffs any of the prior three years that Donathan had worked for the company (or during the years when Donathan's predecessor held the post). Donathan's termination occurred despite the absence of negative reviews, and Oakley Grain hired [a replacement] to fill the position the very next working day. Notably, [the replacement] was not licensed to grade grain and had to forge Donathan's signature on grain slips."

The panel majority also notes that the timing of the decision was highly probative:

"A rational finder of fact could infer from the discussion of layoffs during the phone call about Donathan's letter that Porter and Dennis Oakley decided terminate Donathan's employment at that time-the same day as her protected act. Even taking the day of her termination as the date of the adverse action, however, a delay of a mere eight days in this case is strong evidence of causation in light of the other evidence."

Moreover, a jury could discredit the employer's explanation for the lay off:

"For example, although Defendants argue Norman [operations manager and merchandiser for Oakley Grain] called in the surprise grain order on Saturday following the layoffs and workers were needed to process the new order, Defendants produced no contract to establish the timing of this 'surprise' order."

A jury could infer that the termination of the other workers merely covered the management's tracks. And "because there is no evidence of poor reviews, poor performance, or other possible reasons for Donathan's termination beyond the purported work shortage and her protected act, a reasonable jury could conclude the protected act was the but-for cause of her termination."

And while there is a perceived risk in some retaliation cases that an employee might strategically file a complaint to avoid an impending lay off, a jury could find otherwise here.

"Her position had been repeatedly preserved through many years' seasonal layoffs of outdoor workers, and the only fair reading of the present record is that she was a valued employee who served many functions. Temporal proximity, therefore, is more meaningful in a case such as the present one where it is impossible to infer timing issues arise from an employee's calculated or strategic engagement in protected conduct."

The dissent (by Judge Steven Colloton, previously a short-listed candidate for the most recent Supreme Court vacancy) hints at an argument that would mark a major shift in retaliation law. 

It is widely held (including by the Eighth Circuit) that an employee need only manifest a good-faith belief that she is opposing an illegal practice, even if that turns out to be mistaken in fact. The dissent suggests that this is wrong. The anti-retaliation provision of Title VII, by dissent's lights, may only be invoked when there is an actual violation:

"[T]he district court ruled that Oakley Grain did not engage in the unlawful employment practice that Donathan purported to oppose, and Donathan does not dispute that ruling. She did not, therefore, 'oppose[] any practice' that was 'made . . . unlawful' by Title VII."

The dissent holds that even under the prevailing good-faith standard, the plaintiff could not (as a matter of law) have reasonably believed that the "difference in bonus pay between an employee at Yellow Bend and an employee at Pendleton violated Title VII."

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