Context and Good Documentation Really Matter

While the courts have been largely closed to jury trials in 2020, that has not stopped a slew of labor and employment decisions being issued in the summary judgment context.  Three less publicized decisions addressing common types of proof that plaintiffs and employers often rely on to obtain/defeat summary judgment recently caught my eye.  Those cases are summarized below and stress the importance of context and good documentation in making day-to-day employment decisions and in court, especially at the summary judgment stage.

Past Merit Raises and Evidence of Pretext

Salazar v. Lubbock Cnty. Hosp. Dist., 982 F.3d 386 (5th Cir. 2020).  This was a summary judgment case arising under the ADEA and decided in favor of the employer.  One of the issues before the court was whether an age discrimination plaintiff’s evidence of past merit pay increases created a fact issue as to whether the plaintiff’s discharge for declining performance was a pretext for age discrimination.  The court began by noting that evidence of a merit raise could call into question the sincerity of the employer’s claim of poor performance, but it did not do so in this case because the merit raise the plaintiff relied upon was for performance in the year prior to the year that her performance began to decline.  The court similarly dismissed the evidentiary value of past positive performance evaluations noting that “prior good evaluations alone cannot establish that later unsatisfactory evaluations are pretextual.”  Here, the performance evaluation that accompanied the merit raise also included details of several significant performance shortcomings.  The court thus concluded that the past positive evaluations were not inconsistent with the employer’s evidence of poor performance.  The documentation here was key to the court’s decision.

Replacements and Proving a Prima Facie Case

Texas Tech Univ. Health Sciences Ctr. – El Paso v. Flores, 612 S.W.3d 299 (Tex. 2020).  This was a summary judgment case arising under the TCHRA and decided in favor of the employer.  The issue before the court was whether the replacement of the plaintiff with a significantly younger employee established an inference of discrimination under the McDonnell Douglas framework.  The undisputed evidence established that the plaintiff was removed from her position as a director supporting the university president at the same time a younger employee was promoted to a new position as assistant to the president.  The plaintiff claimed the younger employee was her “true replacement.”  The court observed that whether an employee has been “replaced” depends on whether the replacement’s duties are so similar to those performed by the incumbent that a reasonable juror could conclude the replacement took or was placed in the incumbent’s former position.  Where (i) only some of the duties are assigned to a younger employee, or (ii) the incumbent’s duties are only temporarily assigned to another employee, or (iii) the incumbent’s duties are distributed among multiple employees, most courts have held the incumbent was not “truly” replaced for purposes of a prima facie case.  In this case, the replacement only assumed some of the plaintiff’s duties and did not have a similar level of authority over a broader area of responsibility, notwithstanding the plaintiff’s speculative deposition testimony to the contrary.  Therefore, the alleged replacement was not deemed to be a “true replacement” and the plaintiff could not sustain a prima facie “true replacement” case.

Alaniz v. U.S. Renal Care, Inc., 83 Fed. Appx. 77 (5th Cir. 2020).   In this ADEA case, the court held that summary judgment was wrongly decided in favor of the employer.  The undisputed evidence was that the plaintiff was replaced by a slightly older employee.  The plaintiff argued on appeal that this fact did not preclude her from alleging that she was discharged because of her age when she had sufficient other evidence to create an inference of discrimination.  The Fifth Circuit agreed.  In particular, the plaintiff presented evidence that the older employee was only in place for two months and the employer hired a second, much younger employee in the same position at the same time that plaintiff was discharged.  The plaintiff argued that the older employee was merely a legal cover against an age discrimination claim and the younger employee was the real replacement.  The plaintiff also presented evidence of ageist comments and suggested that the employer started collecting “grievances” against him right after he filed an HR complaint about age discrimination. Together, the court held this evidence was sufficient to make out a prima facie case and to survive summary judgment.

The Bottom Line for Employers:  The above cases reflect different results for the employer precisely because of the context and documentation the parties were able to put in the summary judgment record.  For example, just because a plaintiff is replaced with an older employee does not end the discrimination inquiry; however, if the employer can document substantial, substantive  differences in the position held by the plaintiff and the one held by the replacement, the employer’s defense just got a lot stronger.  The same goes for merit pay increases which are often relied on in a summary judgment proceeding in the context of an employment termination.  Merit pay increases are not necessarily inconsistent with a subsequent discharge for poor performance, but the merit pay documentation should reflect what performance is being rewarded and what performance is not.  These cases are a good reminder of what it takes to prevail on summary judgment and what evidence may derail an early resolution.