EEOC v. United Airlines, Inc., No. 11-1774 (7th Cir. Sept. 7, 2012)

By Paul Mollica

The Seventh Circuit today announces the overruling of its precedents, EEOC v. Humiston-Keeling, 227 F.3d 1024 (7th Cir. 2000) and Mays v. Principi, 301 F.3d 866 (7th Cir. 2002), that held employers had no duty to place employees who were losing their current positions due to disability into vacant positions for which they are otherwise qualified. The court holds that this interpretation of the ADA was superseded by the Supreme Court decision, U.S. Airways, Inc. v. Barnett, 535 U.S. 391 (2002), and that employers have a duty to transfer.

EEOC v. United Airlines, Inc., No. 11-1774 (7th Cir. Sept. 7, 2012): The employer maintained a written policy for the reassignment of persons who became disabled while employed that allowed for a “transfer . . . [to] an equivalent or lower-level vacant position” in some instances. Nonetheless –

“the guidelines specify that the transfer process is competitive. Accordingly, employees needing accommodation will not be automatically placed into vacant positions but instead will be given preferential treatment. This allows employees needing accommodation to submit an unlimited number of transfer applications, be guaranteed an interview and receive priority consideration over a similarly qualified applicant-that is, if two candidates are equally qualified, the employee-applicant seeking accommodation will get the job.”

The EEOC challenged this policy as violative of the ADA. While the district court dismissed the complaint on the merits, under the authority of Humiston-Keeling, the Seventh Circuit reverses. It holds that Barnett – which considered the reassignment issue in the context of a seniority agreement – undermined the Seventh Circuit precedent:

“The EEOC points out that U.S. Airways relied heavily on Humiston-Keeling and, more importantly, that the Barnett Court flatly contradicted much of the language of Humiston-Keeling. U.S. Airways argued that it was not required to grant a requested accommodation that would violate a disability-neutral rule, using the argument from Humiston-Keeling that the ADA is ‘not a mandatory preference act’ but only a ‘nondiscrimination statute.’ 227 F.3d at 1028. The Barnett Court rejected this anti-preference interpretation of the ADA, noting that this argument ‘fails to recognize what the Act specifies, namely, that preferences will sometimes prove necessary to achieve the Act’s basic equal opportunity goal.’ 535 U.S. at 397. Merely following a ‘neutral rule’ did not allow U.S. Airways to claim an ‘automatic exemption’ from the accommodation requirement of the Act. Id. at 398. Instead, U.S. Airways prevailed because its situation satisfied a much narrower, fact-specific exception based on the hardship that could be imposed on an employer utilizing a seniority system. Id. at 405.”

Although the Seventh Circuit summarily considered Barnett consistent with its standing precedent in Mays v. Principi, 301 F.3d 866 (7th Cir. 2002), the panel, with the consent of the full circuit (via 7th Cir. R. 40), holds Humiston-Keeling and Mays overruled. It returns the application of the Barnett standard to the district court:

“On remand, the district court must conduct the Barnett analysis. In this case, the district court must first consider (under Barnett step one) if mandatory reassignment is ordinarily, in the run of cases, a reasonable accommodation. Assuming that the district court finds that mandatory reassignment is ordinarily reasonable, the district must then determine (under Barnett step two) if there are fact-specific considerations particular to United’s employment system that would create an undue hardship and render mandatory reassignment unreasonable.”

The panel notes that the adoption of this standard puts the circuit in line with decisions in the Tenth and D.C. Circuits (although the Eighth Circuit continues to adhere to the pre-Barnett rule).