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Green v. Donahoe, No. 13-1096 (10th Cir. July 28, 2014)

The Tenth Circuit addresses two issues of interest to those who regularly represent employees, especially those in the federal sector. First, the panel holds - in a widening circuit split - that a claim of constructive discharge under Title VII accrues not at the time that an employee quits, but when the last act of alleged discrimination by the employer occurs. In the federal sector, this significant because of the narrow 45-day window for complaining about discrimination. Second, the panel holds that a threatened suspension without pay may, even if it does not materialize, constitute a "materially adverse action" for a Title VII claim of retaliation.

Green v. Donahoe, No. 13-1096 (10th Cir. July 28, 2014): The plaintiff, a former postmaster for the U.S. Postal Service, was turned down in 2008 for a promotion to head the Boulder, Colorado post office in favor of a Latino. He filed a charge alleging Title VII race discrimination, and the matter was eventually settled. Yet Green afterwards experienced what he perceived to be threats and harassment about his EEO filing.

Green was placed under investigation for allegedly delaying mail (a charge that was later discovered to be unfounded) and threatened with criminal prosecution. The Postal Service then placed Green on what it terms an "emergency placement," that is, immediate off-duty, non-paid status. But before Green missed any paychecks, on December 16, 2009, the parties settled the matter, with Green accepting leave and a choice of a transfer (to Wyoming) or retirement. Green was paid retroactively for the three missed days and continued to be paid from accrued annual and sick leave, though he never returned to work. Green eventually submitted his retirement papers on February 9, 2010.

Finally, but not until March 31, 2010 - some three months after his removal - did Green complain to the agency EEO officer about retaliatory constructive discharge. After exhausting his federal-sector administrative procedures on a variety of Title VII retaliation claims, Green sued in federal district court. The district court dismissed, or granted summary judgment on, all of Green's claims.

The Tenth Circuit affirms on all but one count. Two of Green's retaliation claims (receiving a letter notifying him of the investigative interview, and the investigative interview itself), the panel holds were not administratively exhausted through the federal-sector EEO procedures. A third claim (a threat of criminal prosecution) the panel holds was untimely filed. This left the constructive discharge and the threat of unpaid suspension.

The panel holds, in a matter of first impression for the circuit, that limitations runs on a constructive discharge claim *not* from when the employee leaves the workplace, but from the last act of discrimination that prompts an employee to quit or retire. "Constructive discharge occurs when an employer unlawfully creates working conditions so intolerable that a reasonable person in the employee's position would feel forced to resign." [Citation omitted.] While Green claimed that harassment and bullying compelled him to accept retirement, the final one of those acts occurred on December 16, 2009, so his contact with the EEO officer came too late under the 45-day period permitted by regulation (29 C.F.R. § 1614.105(a)(1)) to contact an EEO counsellor.

Federal-sector employee employees are burdened with a very short period to talk to an EEO advisor and file a charge. Nevertheless, the panel reasons: "No policy reason, certainly not the policy behind recognition of constructive discharge claims as a means to provide appropriate relief to employees, commends itself as a ground for postponing the accrual of constructive-discharge claims until the employee leaves work. Such postponement would be contrary to the proposition that 'society and the policies underlying Title VII will be best served if, wherever possible, unlawful discrimination is attacked within the context of existing employment relationships.'" [Citation omitted.]

The panel notes that other circuits (the Second, Fourth and Ninth) hold that constructive discharge claims commence only with the resignation of the employee. But the panel observes that "in any event, we cannot endorse the legal fiction that the employee's resignation, or notice of resignation, is a 'discriminatory act' of the employer." The panel finds support from decisions in the D.C. and Seventh Circuits.

The panel reverses summary judgment on the emergency-placement claim. This claim was both timely and administratively exhausted, but the district court held that the threat to cut off plaintiff's wages was never carried out, so the suspension - while offensive - was not objectively a "materially adverse action." Yet the panel holds that the threat of lost income enough constituted as action likely to deter a reasonable employee from exercising protected Title VII rights:

"[T]he obvious consequence of the placement was to induce Green to settle on terms favorable to the Postal Service. And once he had settled (particularly after he decided to quit), there was little the Postal Service could do to retaliate against him for his subsequent claims of discrimination."

Under such circumstances, "[t]he possibility that one could recover that income by caving to the employer's demands would not provide much comfort."

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