Bailey vs. United Airlines, Inc. 00-2537 IN THE UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT No. 00-2537 BAILEY vs. UNITED AIRLINES, INC. James Bailey, Appellant On Appeal from the United States District Court for the Eastern District of Pennsylvania BRIEF OF THE EQUAL EMPLOYMENT OPPORTUNITY COMMISSION AS AMICUS CURIAE IN SUPPORT OF THE APPELLANT GWENDOLYN YOUNG REAMS Associate General Counsel PHILIP B. SKLOVER Associate General Counsel LORRAINE C. DAVIS Assistant General Counsel ROBERT J. GREGORY Senior Attorney EQUAL EMPLOYMENT OPPORTUNITY COMMISSION 1801 L Street, N.W. Washington, D.C. 20507 (202) 663-4059 STATEMENT OF INTEREST The Equal Employment Opportunity Commission ("Commission") is the agency entrusted with the enforcement of the Age Discrimination in Employment Act of 1967, 29 U.S.C. § 621 et seq. ("ADEA"), and other federal anti-discrimination statutes. In this ADEA case, the district court granted summary judgment in favor of the defendant, holding that the plaintiff failed to file a timely charge of discrimination with the Commission. The court specifically ruled that the plaintiff's charge was untimely because it was not filed within 300 days of when the defendant's agent purportedly told the plaintiff that he had a choice of either being terminated from his job or resigning his employment and signing a release. The plaintiff's charge was not filed within 300 days of the date on which the plaintiff allegedly received notice of the termination/resignation option. The charge was filed, however, within 300 days of the date on which the plaintiff, as per the defendant's instruction, notified the defendant of his decision not to accept the resignation option, thus resulting in the termination of his employment. We believe that, in circumstances of this nature, the triggering event for the running of the charge-filing period should not be the date on which the employer poses the termination/resignation option. Instead, it should be the date on which the plaintiff notifies the employer of his decision with respect to resignation or termination. As discussed below, this approach ensures that a putative claimant is not rushed into the filing of an EEOC charge during the period in which the claimant is mulling over an offer of resignation in lieu of termination. To assist the Court in resolving this important issue, which has recurring significance under the anti-discrimination statutes, the Commission, pursuant to F.R.A.P. 29(a), offers its views to the Court as amicus curiae. STATEMENT OF THE ISSUE Whether the charge-filing period beings to run on a claim of wrongful termination under the ADEA on the date on which the employer extends a resignation/termination option to an employee or on the date on which the employee, acting within the time-frame set by the employer, notifies the employer of his rejection of the resignation option. STATEMENT OF THE CASE The facts relevant to the Commission's amicus participation are as follows. The plaintiff, James Bailey, worked as a commercial airline pilot for Pan American World Airways ("Pan Am"). Bailey v. United Airlines, Inc., 101 F. Supp. 2d 311, 311-12 (E.D. Pa. 2000). In 1991, United Airlines, Incorporated ("United") purchased certain of Pan Am's South American routes. Id. at 312. As part of that purchase, United agreed to hire a number of former Pan Am pilots. Id. Bailey was one of the Pan Am pilots hired by United. Id. Bailey joined United in October 1992. Id. At the time, Bailey was 59 years old and, thus, eligible to bid for a first officer position. Id. Bailey passed United's first officer training and began working as a first officer in November 1992. Id. On March 5, 1993, Bailey turned 60 years old. Id. At that point, FAA regulations disqualified Bailey from working as a first officer. Id. Bailey, however, was eligible to bid for a position as second officer or flight engineer upon the successful completion of United's transition training program. Id. United's transition training for second officers is a multi-week program. Id. Bailey began the program in April 1993. Id. Bailey went through a series of training exercises. Id. Bailey received a number of low ratings during these exercises, although one of the evaluators commented that Bailey "has worked incredibly hard to master the DC-10, and [will] be a fine second officer for [United]." Id. at 312-13. Bailey claims that the low ratings were the product of agism. Id. at 314. In any event, the series of ratings resulted in Bailey's employment status being put before United's Board of Review in early May 1993. Id. at 313. That Board has the authority to mete out remedial action up to and including discharge. Id. at 312. The parties dispute precisely what occurred during the first week of May 1993. According to United's evidence, the Board decided to provide Bailey with the option of either resigning his employment (and signing a release) or having his employment terminated. Id. at 314. On May 4, 1993, Captain Eric Clethen, a member of the Board, contacted Bailey. Clethen claims that he "called Mr. Bailey, informed him of the Board's decision and asked him to travel to San Francisco on May 5, 1993, where he would be removed from United's payroll and offered the opportunity to resign in lieu of termination." Id. Bailey responded that he could not make a meeting on May 5th but would be available to meet with the Board on May 6th. Id. United agreed to extend the date to May 6th.<1> Id. Bailey arrived in San Francisco on May 6th and met with the Board. Id. Bailey was officially presented with the option of resigning upon the condition that he sign a release. Id. Bailey informed the Board that he was not going to exercise the resignation option. Id. Bailey was then notified that his employment was to be terminated. Id. at 314-15. On March 2, 1994, Bailey filed a charge with the Commission in Pennsylvania, Bailey's place of residence. Id. at 315. Pennsylvania is a deferral state and, thus, is subject to a 300-day charge-filing period. Id. Bailey's charge was not filed within 300 days of May 4, 1993, the date on which he was allegedly told by Captain Clethen that he was being given the option of termination or resignation. The charge was filed, however, within 300 days of May 6, 1993, the date on which Bailey met with the Board and informed the Board that he was not accepting the resignation option. In granting summary judgment, the district court relied heavily on the Supreme Court's decision in Delaware State College v. Ricks, 449 U.S. 250 (1980). The court stressed that, under the Ricks standard, the limitations period for a discharge claim "'must be measured from the date the plaintiff was advised he was to be discharged' as opposed to the date of separation." 101 F. Supp. 2d at 316. The court determined that "the undisputed evidence" shows that Bailey had notice of the termination decision as of his May 4th conversation with Clethen. Id. Because Bailey's charge was not filed within 300 days of the May 4th notice of termination, it was, in the district court's view, untimely. ARGUMENT THE CHARGE-FILING PERIOD FOR BAILEY'S CLAIM OF UNLAWFUL TERMINATION DID NOT BEGIN TO RUN UNTIL BAILEY NOTIFIED UNITED THAT HE WAS NOT EXERCISING THE OPTION OF RESIGNING HIS EMPLOYMENT AND EXECUTING A RELEASE OF CLAIMS, AN OPTION THAT UNITED PROVIDED TO BAILEY AS AN ALTERNATIVE TO TERMINATION. This case involves an issue of timeliness arising in the context of a claim of unlawful termination. The lead Supreme Court authority is Delaware State College v. Ricks. In Ricks, the Supreme Court held that the charge-filing period begins to run on a claim of unlawful discrimination when the employer establishes its "official position" and communicates that position through "explicit notice" to the affected individual. 449 U.S. at 258, 262. In a case of unlawful discharge, the employer establishes its "official position" when it decides, unconditionally, to terminate an individual's employment. Id. at 257-58 (final decision to deny tenure, which had the "delayed, but inevitable, consequence" of terminating the plaintiff's employment). An employer triggers the running of the charge-filing period when it provides the affected individual with "explicit" notice of that unconditional decision to terminate. Id. at 258. Under the Ricks standard, the employer's termination decision must be more than "tentative." Currier v. Radio Free Europe/Radio Liberty, Inc., 159 F.3d 1363, 1366-67 (D.C. Cir. 1998). The decision to terminate, as communicated to the employee, must be "unequivocal." Grayson v. K-Mart Corp., 79 F.3d 1086, 1100 n.19 (11th Cir. 1996); see also Colgan v. Fisher Scientific Co., 935 F.2d 1407, 1419 (3d Cir. 1991) (en banc) (under Ricks, the charge-filing period begins to run on a claim of wrongful discharge when the employer has reached a "definitive conclusion" that the individual's employment is to be terminated). In this case, the district court ruled that the charge-filing period was triggered by the conversation of May 4, 1993, between Clethen and Bailey. The court viewed this conversation as having established United's "official position" that Bailey's employment was "going to be terminated." 101 F. Supp. 2d at 318. Invoking Ricks, the court ruled that Bailey had sufficient knowledge of the impending termination, as of the May 4th date, to trigger the limitations period. The problem with the district court's ruling is that the decision allegedly communicated to Bailey, on May 4, 1993, was, by its own terms, tentative in nature. According to United's own evidence, United's termination decision, as of May 4, 1993, was conditional; Bailey was to be terminated if he rejected the option of resigning his employment and signing a release. Termination was not an "inevitable" consequence of the May 4th notice. Cf. Ricks, 449 U.S. at 257-58 (stressing that termination was a "delayed, but inevitable, consequence of the denial of tenure"). To the contrary, Bailey himself retained the power to avoid a termination by accepting United's invitation to resign his employment. To be sure, under United's version of the events, Bailey knew, as of May 4, 1993, that his employment was going to end in some fashion -- resignation or termination. But a resignation is not the same as a termination. When an employee voluntarily resigns his employment, there is no adverse employment action associated with the separation. The voluntary quit vitiates any injury that may have occurred had the individual's employment been terminated by the employer. See, e.g., Taylor v. Federal Deposit Ins. Corp., 132 F.3d 753, 766-68 (D.C. Cir. 1997); Jurgens v. EEOC, 903 F.2d 386, 389-90 (5th Cir. 1990); Maney v. Brinkley Municipal Waterworks and Sewer Dep't, 802 F.2d 1073, 1075 (8th Cir. 1986); Derr v. Gulf Oil Corp., 796 F.2d 340, 342-43 (10th Cir. 1986). Notably, voluntary quits have been found even in the context of a "resign or be fired" ultimatum. In such cases, by accepting the resignation option, an employee foregoes a claim of wrongful termination. See Zepp v. Rehrmann, 79 F.3d 381, 385-87 (4th Cir. 1996); Hargray v. City of Hallandale, 57 F.3d 1560, 1568 (11th Cir. 1995); Christie v. United States, 518 F.2d 584, 588 (Ct. Cl. 1975). When an employer poses the "resign or be fired" ultimatum, the employer is giving the employee the option of avoiding a termination. A termination occurs only if the employee rejects the resignation option. Until the employee does so, under the terms set down by the employer, the employment decision is entirely tentative. Conceivably, "a resign or be fired" ultimatum might result in a constructive discharge, particularly where, as here, the time given for mulling over the resignation option is brief. Compare Bodnar v. Synpol, Inc., 843 F.2d 190, 193-94 (5th Cir. 1988) (retirement was not rendered involuntary by the fact that the employee was given only 15 days to make the resignation decision, although the court would "scrutinize closely any plan that was offered to employees on a shorter schedule") with Paolillo v. Dresser Indus., Inc., 821 F.2d 81, 84 (2d Cir. 1987) (factfinder could determine that employees' resignations were involuntary where the options presented were complex and the employees were given only one or two days to decide whether to resign). A constructive discharge, however, has different legal consequences than an actual discharge. Most notably, the limitations period on a claim of constructive discharge begins to run when the employee "effectively communicate[s] her intention to resign." Flaherty v. Metromail Corp., 235 F.2d 133, 139 (2d Cir. 2000); accord Draper v. Coeur Rochester, Inc., 147 F.3d 1104, 1110-11 (9th Cir. 1998); American Airlines, Inc. v. Cardoza-Rodriguez, 133 F.2d 111, 123 (1st Cir. 1998); Young v. Nat'l Ctr. for Health Servs. Research, 828 F.2d 235, 237-38 (4th Cir. 1987). Thus, in this case, if Bailey had accepted the resignation option and then claimed constructive discharge, Bailey's claim would have accrued on the date on which Bailey informed United of his intention to accept the resignation option, not the date on which he was presented with the resignation/termination option. See American Airlines, Inc., 133 F.3d at 123 (charge-filing period began to run on claim of constructive discharge, in case in which employees were presented with a resignation/termination option, "when each employee accepted [the resignation option]"). It makes no sense to say that an employee accepting the resignation option has a full 300 days from that date to file a charge, while a person who rejects the resignation option is limited to 300 days from the date on which the resignation/termination option is tendered. The operative date in cases of this nature is not the date on which the employer poses the resignation/termination option. The operative date is the date on which the employee acts on the option under the terms specified by the employer. This is true regardless of whether the employee resigns and later sues for constructive discharge, or rejects the resignation option, thus triggering an actual termination. This approach to the timeliness issue is fully compatible with the Supreme Court's decision in Ricks. Ricks rejects the view that the charge-filing period does not begin to run until the employer's last date of employment. 449 U.S. at 256-60. So too does this approach. The charge-filing period begins to run on the date on which the employee communicates his rejection of the resignation option even if the employee continues to work for some period after that date. Cf. American Airlines, Inc., 133 F.3d at 123 (charge-filing period began to run on claim of constructive discharge on date employees accepted resignation option, not on date "they actually left American's employ after electing to [resign]"). Ricks also rejects the view that the charge-filing period does not begin to run until the employee has had the opportunity to grieve the termination decision. So too does this approach. The charge-filing period begins to run on the date on which the employee communicates his rejection of the resignation option even if the employee has the ability to grieve the termination.<2> Ricks requires an employee to act when the employee receives notice of a final decision to terminate his employment. It does not require the employee to act when the employer itself renders the decision tentative by expressly offering the employee the option of resigning his or her employment. There are important policy reasons for adopting this approach to the timeliness issue. The anti-discrimination statutes exist to root out unlawful discrimination. Employees are free to file charges with the Commission when they feel that they have been subjected to unlawful discrimination. An employee, however, should not have his hand forced before a claim has ripened. See, e.g., Thorne v. City of El Segundo, 802 F.2d 1131, 1134 (9th Cir. 1986) (purposes of the anti-discrimination statutes "are best served when parties, where possible, attack discrimination within the context of their existing employment relationships"). By extending the resignation option, an employer is, in effect, providing the employee with the means of resolving his employment situation. An employee can accept the resignation option and avoid an adverse employment action. An employee, in such a circumstance, should not be required to act while the resignation option is still outstanding. A simple hypothetical illustrates the point. An employer in a non-deferral State (with a 180-day charge-filing period) provides an employee with a resignation/termination option. The employer gives the employee six months (180 days) to consider the option. The employee takes the full six months to deliberate the option. On the 180th day, the employee notifies the employer that he is not resigning. Under the district court's ruling in this case, the employee has no time to file a charge challenging the termination; the limitations period began to run on the date the employee received notice of the resignation/termination option. Such an approach to timeliness encourages the filing of unnecessary charges, forcing the employee to act while he is deliberating an option that may well render the filing of any charge moot. See Colgan, 935 F.2d at 1421 (stating that employees should not be forced "to launch preemptive strikes to preserve their ADEA rights"). These policy concerns have even more force when the resignation option is tied to a release of claims. It is not uncommon for an employer to ask for a release when it extends the resignation option. The employer does so to purchase an extra layer of protection in the event the resignation is not viewed as voluntary. The release may include the payment of some additional benefits to the employee. Under the ADEA, the employee must be given a certain amount of time to consider the waiver agreement. See 29 U.S.C. § 626(f)(1)(F)-(G) (for a waiver of any right or claim to be knowing and voluntary under the ADEA, an individual must be "given a period of at least 21 days within which to consider the agreement" and a period of at least 7 additional days to revoke the agreement). The charge-filing period should not begin to run while the employee is deliberating a choice that may very well be desirable to the employee, thus achieving one of the principal objectives of the ADEA -- the voluntary resolution of employment disputes. See 29 U.S.C. §626(b) (emphasizing the goal of "voluntary compliance" with the ADEA's requirements "through informal methods of conciliation, conference, and persuasion"). At bottom, United wants to have it both ways. United dangled the resignation option before Bailey. If Bailey had taken that option, United surely would have argued that Bailey voluntarily quit his employment, thus vitiating any claim of wrongful termination or constructive discharge (although, on this set of facts, e.g., a two-day period during which to deliberate the option, that argument may have been a difficult one to make). As it turns out, Bailey did not accept the offer. Now, United wants to insist upon the earlier date as the basis for the running of the charge-filing period on the theory that Bailey's employment was effectively terminated as of that date. United should not be provided with such an unfair windfall. United, of course, is free to set the terms of an employee's denouement. United could have simply notified Bailey of his termination sans the resignation option. If United had done so, that notice would have triggered the limitations period. United, instead, chose to extend the resignation option. United provided Bailey with a two-day period of deliberation. Bailey complied with that tight deadline and, on the date specified by United, made clear that he was not going to accept a resignation. Under these circumstances, the charge-filing period did not begin to run until the May 6th meeting in San Francisco. It was then that Bailey communicated his rejection of the resignation option, thus rendering the prior tentative decision to terminate his employment final. CONCLUSION This Court should hold that the charge-filing period did not begin to run on Bailey's claim of unlawful termination under the ADEA until Bailey notified United of his rejection of the resignation option. Respectfully Submitted, GWENDOLYN YOUNG REAMS Associate General Counsel PHILIP B. SKLOVER Associate General Counsel LORRAINE C. DAVIS Assistant General Counsel ROBERT J. GREGORY Senior Attorney EQUAL EMPLOYMENT OPPORTUNITY COMMISSION 1801 L Street, N.W. Washington, D.C. 20507 March 26, 2001 (202) 663-4059 1 Bailey claims that, despite Clethen's testimony to the contrary, Bailey did not have clear knowledge of the Board's intentions until he met with the Board on May 6th. The Commission's brief does not wade into this factual quagmire. Instead, the brief assumes that Bailey received precisely the notice that Clethen claims to have given to Bailey on May 4th. 2 There are obvious differences between a final termination decision, subject to an independent grievance procedure, and a termination decision that is conditioned upon an employee's rejection of a resignation option. In the former case, a final decision to terminate has been made; the grievance procedure merely provides a possible remedy for that termination, meted out by a third-party decision-maker. In the latter case, the decision to terminate is tentative; the employee himself can avoid the adverse employment decision by accepting the resignation option.