EMPLOYER MAY HAVE ACTED UNLAWFULLY IN REVOKING JOB OFFER

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By: Carol G. Schley, Clark Hill PLC

            A recent decision by a federal appeals court is a reminder to employers that there are limitations on taking adverse action against applicants and employees who act against the employer’s interests in their non-work activities.

            In Linkletter v. Western & Southern Financial Group, 2017 U.S. App. LEXIS 5130 (6th Cir. 2017), plaintiff Gayle Linkletter was offered a job with defendant Western & Southern, an insurance company located in Cincinnati, which she accepted.  However, before her employment commenced, the job offer was rescinded.  Linkletter alleged that she was told by the vice-president of HR that the offer was rescinded because Linkletter had “taken a position that was contrary to Western & Southern,” namely, Linkletter’s signing of an on-line petition supporting a local women’s shelter, Anna Louise Inn.

            Western & Southern and the Inn had a contentious history.  Prior to Linkletter’s job offer, the Inn had sued Western & Southern under the federal Fair Housing Act (FHA), alleging that Western & Southern had illegally attempted to force the Inn to move out of Western & Southern’s neighborhood.  Among other things, Western & Southern had been accused of informing Cincinnati’s mayor that the Inn was “not appropriate” for the neighborhood, due to its “low-income permanent housing” and housing for “recovering prostitutes,” photographing the Inn’s residents without permission, and falsely accusing the residents of criminal activity. 

            The litigation between Western & Southern and the Inn was ultimately settled.  However, while it was still pending, Linkletter signed an online petition supporting the Inn as “safe and affordable housing for single women.”  The Inn posted the petition online, and when Western & Southern discovered Linkletter had signed it, it revoked her job offer.

            Linkletter thereafter sued, claiming Western & Southern’s revocation of her job offer violated the FHA.  By signing the petition, Linkletter claimed she was aiding and encouraging the women of the Inn to exercise their rights under the FHA, which, among other things, prohibits housing discrimination on the basis of sex, and Western & Southern unlawfully retaliated against her when she did so.

            At the trial court level, Linkletter’s claim was dismissed for failure to state a viable claim.  However, the Sixth Circuit Court of Appeals (which is the federal appeals court for Michigan, Ohio, Kentucky and Tennessee), held that Linkletter’s claim was valid, and therefore could proceed to trial.  The appeals court held that the anti-interference provision of the FHA should be construed broadly and that “the scope of the statute extends to employers who cancel contracts in retaliation for Fair Housing Act advocacy.”  The court further held that Linkletter’s signing of the petition “aided and encouraged” the women of the Inn, as the petition “existed to encourage the women to remain in their residence in opposition to the alleged discrimination by Western & Southern.”  Finally, the court rejected Western & Southern’s claim that its opposition to the Inn, and its rescission of Linkletter’s job offer, were due to economic reasons, not sex discrimination.  “The existence of economic (or religious or moral) motivations does not protect the defendants from housing discrimination claims when their actions had a clear discriminatory effect.  Economic motivation does not cleanse discrimination.” 

            The Linkletter case is a reminder to employers that there are limitations on their ability to take adverse employment actions against applicants and employees based upon their non-work activities.  While Linkletter specifically dealt with a person supporting others’ rights under the FHA, there are other statutes that also contain similar provisions, including Michigan’s Elliott-Larsen Civil Rights Act and Title VII.  To avoid potential liability in this area, it is recommended that any adverse employment action that has a possibility of raising similar issues to be reviewed by legal counsel before a decision is made.

Carol G. Schley is a member of the Detroit SHRM Legal Affairs Committee and an attorney at the law firm Clark Hill PLC.  She can be reached at cschley@clarkhill.com or (248)530-6338.

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