May 5, 2016

Tick Tock: Appeals Court Opens Door to Stale Discrimination Claims by Broadly Interpreting Statute of Limitations Tolling Clause

Posted in Age, Discrimination, Employee Handbooks, Harassment, Limitation of Actions, MDHR Mediation, Sexual Harassment, Statutes of Limitation tagged , , , , , , , at 11:42 am by Tom Jacobson

Tom Jacobson retake - Copy - Cropped

“In light of the Peterson decision, employers should review their HR complaint policies to minimize the chance of inadvertent extensions of the Minnesota Human Rights Act statute of limitations,” says employment law attorney Tom Jacobson.

Employers may need to update their HR complaint policies and procedures in light of a May 2, 2016 decision by the Minnesota Court of Appeals in the case of Peterson v. City of Minneapolis. The decision has the impact of potentially extending the time limit employees have for pursuing claims under the Minnesota Human Rights Act, and policy updates may minimize the impact of this decision.

The Peterson case started when two Minneapolis police officers claimed their October, 2011 transfers were the result of age discrimination. The officers filed complaints with the city’s human resources department a month later. The HR department investigated the complaints, and in January, 2013 the department concluded that the transfers were not based on age.

The officers then filed age discrimination charges with the Minnesota Department of Human Rights. They later withdrew those charges, but in March, 2014 they filed a lawsuit against the city of Minneapolis. The trial court dismissed the officers’ case on the basis that it was started after the one year statute of limitations in the Minnesota Human Rights Act had expired. One of the officers appealed.

In reviewing the trial court’s decision, the appellate court noted that under the MHRA:

The running of the one-year limitation period is suspended during the time a potential charging party and respondent are voluntarily engaged in a dispute resolution process involving a claim of unlawful discrimination under this chapter, including arbitration, conciliation, mediation or grievance procedures pursuant to a collective bargaining agreement or statutory, charter, ordinance provisions for a civil service or other employment system or a school board sexual harassment or sexual violence policy.

Thus, the issue before the Court of Appeals was whether filing an internal complaint with the city’s HR department meant the parties were “voluntarily engaged in a dispute resolution process involving a claim of unlawful discrimination,” so as to suspend (or “toll”) the running of the MHRA’s one-year statute of limitations. The court ruled that they were.

Specifically, the court held that the city’s HR complaint process was a “dispute resolution process” under the MHRA, so by engaging in that process, the statute of limitations did not run while that process was ongoing. Consequently, the officers’ MDHR charge, which was filed more than a year after the alleged discrimination, was ruled to be timely despite the MHRA’s one-year statute of limitations.

With this ruling, the Court of Appeals has essentially given employees a tool for dragging out their deadline for filing MHRA charges or lawsuits well beyond the one-year time limit they would otherwise have. This is because for as long as they and the employer are engaged in an internal HR complaint process, the statute of limitations clock will likely not be ticking.

Taken to extremes, this means an employee could file an internal complaint 364 days after an alleged discriminatory act, thereby likely suspending the statute of limitations that would otherwise have expired the next day. And, because the Court of Appeals did not clarify the limits of what it means to “voluntarily engage in” such internal complaint processes, it appears an employee could extend the time limit almost indefinitely by repeatedly engaging the employer in ongoing discussions about the same problem or the process itself.

It is difficult to predict how this case will play out in practice. However, to minimize its impact, employers should consider: revising HR complaint policies to address how such complaints impact the MHRA’s statute of limitations; promptly investigating and resolving discrimination and harassment complaints so as to quickly end what could be perceived as “voluntary engagement” in a “dispute resolution process.”

For more information about these or other employment law issues, please contact me at taj@alexandriamnlaw.com.

The comments posted in this article are for general informational purposes only. They are not to be considered as legal advice, and they do not establish an attorney-client relationship. For legal advice regarding your specific situation, please consult your attorney.

Copyright 2016 Swenson Lervick Syverson Trosvig Jacobson Schultz Cass, PA.

January 5, 2015

MDHR Mediation — a Cautionary Tale

Posted in Alternative Dispute Resolution, Discrimination, MDHR Mediation, Mediation, Minnesota Human Rights Act, Uncategorized tagged , , , at 11:33 am by Tom Jacobson

Mediated Settlement AgreementI am a strong advocate for mediation as a form of alternative dispute resolution (“ADR”). However, a recent Minnesota Department of Human Rights (“MDHR”) case should cause anyone with charges pending before that agency to think twice before participating in MDHR mediation.

For the uninitiated, mediation is an ADR process where someone trained as a neutral (usually an attorney) is hired to meet with the parties and facilitate a discussion which, in the majority of cases, results in settlement of the dispute. It is a highly effective form of ADR.

When employment discrimination charges are filed with MDHR, the agency will often offer to mediate the dispute. Parties who agree to MDHR mediation hope for the same outcomes to be achieved as in private mediation; that is, saving the expense and delay of litigation, fashioning their own relief, maintaining a level of confidentiality, and avoiding the risk of a judge or jury publicly deciding their fate. An additional benefit of MDHR mediation is that the agency provides the mediator at no cost to the parties, whereas the parties typically share the cost of a privately retained mediator.

One recent MDHR case highlights the potential for unintended consequences of MDHR mediation. The case involved discrimination charges filed against Alexandria Light and Power (“ALP”) by an employee who had resigned. The case was settled through MDHR mediation with an agreement for the claimant to paid $65,000.00 by ALP’s insurer and with no admission of liability or findings of wrongdoing by ALP. This part of the process seemed to accomplish the parties’ goals of saving costs and minimizing risk.

However, after the settlement was reached, MDHR publicized the outcome with a press release that was posted on its website and then re-distributed by local and statewide media. The problem with the MDHR press release was that it did not accurately describe the case or the settlement. Consequently, ALP issued its own statement to correct the misinformation.

Because ALP is a municipally owned utility, state law required that the settlement be public information; therefore, the parties did not expect the settlement to remain confidential. However, having the settlement inaccurately described in an MDHR press release was an unexpected twist.

Thus, parties facing MDHR charges should bear in mind the possibility of the agency publicizing the outcome of a settlement. To minimize that risk, consider using a private mediator, include confidentiality clauses (to the extent allowed by law), and if utilizing MDHR mediation, discuss beforehand with the agency any publicity limits that may be imposed.

For more information about this article, please contact me at alexandriamnlaw.com or  taj@alexandriamnlaw.com.

The comments posted in this blog are for general informational purposes only. They are not to be considered as legal advice, and they do not establish an attorney-client relationship. For legal advice regarding your specific situation, please consult your attorney.

Copyright 2015 Swenson Lervick Syverson Trosvig Jacobson Schultz, PA

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