Job Accommodations Usually Cheap, but Cost Limits Untested

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By Patrick Dorrian

June 16 — Job accommodations sought by workers with disabilities rarely come with a high price tag, but when they do, employers likely won't be able to deny their requests based on cost alone.

That’s the view of the Equal Employment Opportunity Commission, at least for large employers, including the federal government, EEOC Legal Counsel Peggy Mastroianni said.

The reason is that the Americans with Disabilities Act’s test for proving a requested accommodation poses an undue hardship to an employer’s business may require that the financial resources of the entire entity be considered, not just the resources of the particular department or business unit in which the employee works, she told Bloomberg BNA.

“Large organizations will have a hard time” proving undue hardship based on cost alone, Mastroianni said.

Federal courts seem to be going with the EEOC’s view, said Frank C. Morris Jr. of Epstein Becker & Green in Washington. That may conflict with the ADA’s original intent, he told Bloomberg BNA.

“You could argue that some of the recent court decisions have gone further than the framers of the ADA intended in holding that an accommodation’s cost doesn’t show undue hardship unless it would essentially put a company out of business,” said Morris, co-chairman of the firm's ADA and public accommodations group.

Two Cases Highlight Issue

Two recent cases Mastroianni and Morris cited are still pending in the U.S. District Court for the District of Maryland.

In Reyazuddin v. Montgomery County, D. Md. , No. 8:11-cv-00951, a blind information aide sued Montgomery County, Md., for refusing her requests to make the software at the county's new call center accessible to the blind so she could be transferred to the new call center along with her sighted co-workers.

After Yasmin Reyazuddin's Rehabilitation Act claims were revived by the U.S. Court of Appeals for the Fourth Circuit last June, a jury Feb. 26 rejected the contention that it would place an undue hardship on the county to make the call center accessible to her.

Cost estimates for making the new software usable by Reyazuddin had ranged pretrial from $129,000 to $648,000. But following the jury's verdict, the trial judge May 27 approved further discovery on the issue. Although it found in her favor, the jury didn't award Reyazuddin any money.

In reviving Reyazuddin's claims, the Fourth Circuit emphasized that cost is just one potential factor under the ADA undue hardship analysis (42 U.S.C. § 12111(10)). Factors such as the number of employees at the new call center, the savings the county will realize from centralizing its call center operations and the substantial personnel resources the county devoted to the call center project also need to be considered, the Fourth Circuit said.

ADA's Undue Hardship Factors

Under the Americans with Disabilities Act, the nonexhaustive list of factors to consider in determining whether an accommodation poses an undue business hardship include:

  •  its nature and cost;
  •  financial resources of the facility providing the accommodation, as well as of the covered entity;
  •  number of employees at the facility, as well as at the covered entity;
  •  effect on expenses and resources, or other impacts on the facility's operation;
  •  number, type and location of the entity's facilities;
  •  type of operation or operations of the covered entity, including the composition, structure and functions of its workforce; and
  •  the geographic separateness, and the administrative or fiscal relationship of the facility in question to the covered entity.

 

In Searls v. Johns Hopkins Hospital, D. Md. , No. 1:14-cv-02983, a deaf nurse alleged that Johns Hopkins Hospital violated the ADA when it rescinded her job offer after concluding it was too expensive to provide her with the assistance of a full-time American Sign Language interpreter. The hospital projected the cost as $120,000 annually.

Judge Catherine C. Blake Jan. 21 granted Lauren Searls's motion for partial summary judgment on the issue of liability, finding that the hospital's argument focused solely on the budgets of the department and unit into which Searls was to be hired, and didn't take into account the hospital's overall $1.7 billion budget. The projected $120,000 cost of an interpreter for Searls would come to just 0.007 percent of Johns Hopkins's overall operational budget, Blake said.

The parties April 20 informed Blake that they had reached a settlement, and the judge May 12 gave them until June 20 to finalize their agreement.

In rejecting the hospital's cost-based undue hardship defense, Blake cited the Fourth Circuit's opinion in Reyazuddin for the proposition that Johns Hopkins's overall budget was a relevant factor.

She also embraced Reyazuddin's holding that an employer's budget for workplace accommodations isn't relevant to the undue hardship test.

Blake cited the EEOC’s interpretive guidance in finding that the fact that a full-time interpreter’s salary would be twice Searls’s pay as a nurse—by itself—didn't mean providing her that accommodation would necessarily be an undue hardship.

There is nothing in the ADA indicating that the salary of the worker seeking accommodation should be considered, “so that's never a factor,” Mastroianni said.

She said the EEOC thinks Reyazuddin and Searls were decided in accordance with the agency's long-standing views on reasonable accommodation and the undue hardship defense.

Reyazuddin and Searls both indicate that courts aren't “going to defer to a decision by an employer” as to what the company is going to spend to accommodate a worker with a disability, Mastroianni said.

At Odds With Statutory Intent, Earlier Cases?

But Morris said the logic in Reyazuddin and Searls is at odds with Congress's intent in passing the ADA. He said lawmakers didn't intend courts to fixate on an entity's overall operations in determining whether an accommodation is reasonable or an undue hardship.

Employers make budgetary decisions based on business units, and no company can make a business plan without breaking down and attributing costs to its various units, Morris said. “That's true whether the business is for-profit or not-for-profit,” he said.

Morris also said the Searls court missed the mark in suggesting that paying two times a disabled worker’s salary for an interpreter isn't strong evidence of undue hardship.

“This is particularly so in that unlike an expenditure for a piece of equipment which would be a one-time expense amortized over the years of the employee’s employment, the interpreter expense would be a substantial on-going expense so long as the employee remained employed,” Morris said. “I do not believe the framers of the ADA had such a draconian result in mind.”

Courts traditionally have found that the employee has some sort of burden in the first instance to show not just that a proposed accommodation will be effective, but that it's facially reasonable, Morris said. That includes showing the requested accommodation won't be unduly expensive if it appears the costs may be high, he said.

Reyazuddin and Searls “seem to be reading the employee's burden out of the equation,” he said.

In the early days of the ADA, the First Circuit held that cost can be an issue for a worker to show in establishing that a proposed accommodation is reasonable. Similarly, the Second Circuit ruled that what's reasonable is “relational,” and that an accommodation's costs, not just its benefits, are relevant to the plaintiff's initial showing.

In addition, the Seventh Circuit held that as part of the burden of establishing preliminarily that an accommodation is reasonable, a worker must show that it's both “efficacious” and proportional to the costs. The Sixth Circuit cited the Seventh Circuit's opinion on that point in noting that “the disabled individual bears the initial burden of proposing an accommodation and showing” it's objectively reasonable.

But Mastroianni countered that employers in some of the earlier cases “tried to load up” on what is meant by “reasonable” under the ADA. She said after those circuit court rulings, the U.S. Supreme Court in 2002 held in US Airways, Inc. v. Barnett, 535 U.S. 391, 12 AD Cases 1729 (2002), that a worker just needs to show a proposed accommodation is reasonable “ordinarily or in the run of cases.” She noted, however, that the justices rejected the EEOC's position that reasonable simply means “effective.”

Gap in Case Law

Although there are a few other recent cases involving accommodation costs, there appears to be a gap between the pre- Barnett decisions and the newer ones.

Mastroianni and Morris offered similar explanations for why the cost question may be coming up again after not being much of an issue for so long.

Post- Barnett until the ADA Amendments Act took effect in 2009, the focus in most federal disability bias cases was on whether the plaintiff was a covered worker with a disability, Mastroianni said. The prediction was that with the ADAAA's shift of the focus away from questions of coverage, other issues would necessarily be litigated, she said.

JAN Monitors ‘Typical' Accommodations Costs

The Job Accommodation Network began studying disability-based workplace accommodation costs in 2004, and has continued to do so ever since, apart from a January 2007 to June 2008 break caused by funding constraints.

It reported in September 2015 that 58 percent of accommodations “cost absolutely nothing to make.”

Beth Loy, a principal consultant with the service, told Bloomberg BNA that when there is an expense for employers in making job accommodations for disabled workers, the typical cost has “fluctuated between $500 and $600.” That range “has held steady since 2004,” she said.

Because the ADA amendments intended to and did broaden coverage under the statute, more cases are surviving challenges to coverage, Morris said. As a result, reasonable accommodation and undue hardship questions are more frequently the focus of ADA and Rehabilitation Act litigation, which in turn increases the chances of the cost issue being raised, he said.

“And what JAN says is true,” Mastroianni said, referring to a series of studies by the Job Accommodation Network that show the typical cost of accommodating a disabled worker is usually quite low, and has remained that way year over year (see box).

JAN, a service provided by the Labor Department's Office of Disability Employment Policy (ODEP), is the leading source of free, confidential guidance on workplace accommodation and disability issues.

The EEOC doesn't see many ADA charges involving the cost issue, Mastroianni added.

Morris said he has always told clients that cost isn’t an easy factor to prove and prevail upon in showing undue hardship. Moreover, the cost of providing an accommodation isn't significant in most cases, he said.

Rather, the potential hardship of providing a requested accommodation typically arises from a factor other than cost, such as whether granting a worker's accommodation request will in effect eliminate an essential function of the job, he said.

But that doesn’t mean that the need to consider an accommodation's cost where it may be excessive should be written out of the law, Morris said.

He noted that an example used over the years is that an employer wouldn’t have to install an elevator in its workplace for an employee who is mobility impaired, although the worker may be entitled to a different accommodation, such as being moved to a lower floor or a more accessible work location.

“What’s the rationale for that if not cost?” he asked, noting that the elevator example wasn't mentioned in either Reyazuddin or Searls.

Will Outer Limit Ever Be Set?

Further rulings on employer accommodation expenses are unlikely to come out of the Searls case given that it has apparently been settled.

While it's possible the district court in Reyazuddin may order the county to transfer the employee to the new call center, and in the process further address the limits of accommodation costs, it's also possible the case will settle in light of the jury's verdict against the county on the issue of liability.

But will more courts begin to address the issues presented in those cases, and will they continue the trend toward embracing the EEOC's views on disability-related accommodation costs? Several factors point to courts continuing to confront the cost question and perhaps setting accommodation expense benchmarks for employers.

First, as both Morris and Mastroianni said, the ADAAA's shift in focus in disability bias cases away from coverage questions has increased the rate at which accommodation expense issues are and will be litigated.

Second, disabled individuals as a group generally want to work and Bureau of Labor Statistics figures show that the number of people with a disability who are employed is rising. Though that increase is marginal and the employment rate among the disabled population remains low, ongoing government initiatives should bolster both numbers.

These initiatives include the EEOC's proposed new affirmative action goals for federal agencies on hiring workers with disabilities, DOL Office of Federal Contract Compliance Programs rules requiring federal contractors to establish a nationwide 7 percent utilization goal for people with disabilities in each job group of their workforce and ODEP's teaming with the Families and Work Institute to promote employment strategies for workers with disabilities.

Third, rapid technological advances continually widen the pool of potential accommodations for a variety of disabled workers, leading to more disabled individuals being able to sustain employment and more requests for employers to provide equipment, services or other measures to assist them.

To contact the reporter on this story: Patrick Dorrian in Washington at pdorrian@bna.com

To contact the editor responsible for this story: Susan J. McGolrick at smcgolrick@bna.com