Lowe's Settles ADA Leave Case for $8.6 Million

From labor disputes cases to labor and employment publications, for your research, you’ll find solutions on Bloomberg Law®. Protect your clients by developing strategies based on Litigation...

By Patrick Dorrian

May 13 —Lowe's Cos. will pay $8.6 million to resolve an EEOC lawsuit alleging the company unlawfully fired a class of workers whose disability-related medical leave needs exceeded the company's maximum leave policy.

In addition to establishing an $8.6 million class settlement fund, the company also will revise its employee leave and other policies, including adding a provision requiring the consideration of extended leave as a reasonable accommodation for disabled workers who have exhausted the maximum leave otherwise allowed by Lowe's.

That provision mirrors guidance issued May 9 by the Equal Employment Opportunity Commission regarding employer-provided leave as an accommodation under the Americans with Disabilities Act (89 DLR A-1, 5/9/16).

The settlement should put employers on further notice that the EEOC is keeping a close eye on companies' use of maximum or “no fault” leave policies and the related issues discussed in the May 9 guidance, including “100-percent healed” policies.

The agreement resolves the agency's May 3 lawsuit against Lowe's filed in the U.S. District Court for the Central District of California. According to the EEOC, the company discharged a class of workers based on their actual or perceived disabilities or based on their association with individuals with disabilities.

The company discharged the workers after first refusing to provide them with a reasonable accommodation in the form of an extended medical leave, and instead held them to the maximum leave allowed under Lowe's policy, which was initially 180 days and later was changed to 240 days.

According to the EEOC, the ADA requires employers to consider requests for leave as an accommodation regardless of the limits of any company policy or contrary federal or state leave law.

The four-year consent decree was signed May 12 by Judge Andre Birotte Jr.

EEOC Hoping for Voluntary Compliance

In a May 13 statement announcing the agreement, EEOC General Counsel David Lopez said the agency hopes the pact demonstrates the need for employers to take it upon themselves to update their leave policies as necessary.

“This settlement sends a clear message to employers that policies that limit the amount of leave may violate the ADA when they call for the automatic firing of employees with a disability after they reach a rigid, inflexible leave limit,” Lopez said. “We hope that our efforts here will encourage employers to voluntarily comply with the ADA.”

Anna Park, the regional attorney for the EEOC’s Los Angeles District Office, which handled the litigation for the agency, commended the role Lowe's played in reaching a settlement to the case.

“We applaud the efforts by Lowe’s in reaching a resolution with EEOC that provides both meaningful monetary relief and important equitable relief for thousands of former Lowe’s employees,” she said. “We encourage people impacted by this situation to come forward and make a claim.”

In a May 13 e-mail to Bloomberg BNA, the company noted that it has already updated its leave-of-absence policies and taken similar measures regarding the leave rights of disabled workers.

“Lowe’s is proud to be an equal opportunity employer,” spokesperson Karen Cobb said. “We modified our leave of absence policies in 2010 to further inform employees of their rights under the ADA and have since centralized our leave-of-absence management to ensure consistency in applying our policies and help employees manage their leaves of absence and accommodations. We worked cooperatively with the EEOC to reach a fair resolution.”

Three Charging Parties

The EEOC lawsuit grew out of discrimination charges filed by Leslie Tanimoto, David Shaw and Gary White. They will share in the $8.6 million settlement, along with other eligible claimants, in amounts to be set by the EEOC.

According to the agreement, eligible claimants include all workers who were subjected to the Lowe's maximum leave policy who were either actually disabled, regarded by the company as disabled, had a record of disability, or were associated with someone with a disability.

The agreement requires Lowe's to ensure that any employee with a disability who requests leave as an accommodation is provided with the interactive process required by the ADA. In addition, the company must review and revise its leave-of-absence policies to ensure compliance with the ADA's job accommodation requirements.

Lowe's has retained EEO consultants to assist the company in the latter effort, according to the pact. The consultants will also work with Lowe's in handling employee requests for extended leave or other potential accommodations related to a return to work following a medical leave of absence, and in implementing a centralized system for tracking such requests.

The company must also revise its attendance policies to include, among other things, a clear explanation of employee rights under the ADA and Lowe's policies with regard to employee leave and the potential availability of additional leave as a reasonable accommodation.

The agreement also imposes notice-posting, training, record-keeping and reporting requirements on the company. Among the records Lowe's will be required to maintain and report on is an employee accommodations log.

Kevin J. White in Washington and Matthew I. Bobb in Los Angeles, both of Hunton & Williams LLP represented Lowe's.

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

Request Labor & Employment on Bloomberg Law