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Supremes start work: 3 employment law cases on High Court docket this year


The Supreme Court term that began yesterday will decide three important employment law cases, starting with oral arguments today in an appeal that asks whether the government can compel employees of a federal contractor to submit to background checks into their personal business.

Other cases, to be argued later this year, will address whether an employer is liable for a supervisor’s discriminatory act and the extent to which state laws can require employers to use the federal government’s voluntary E-Verify employment eligibility system.

NASA v. Nelson (09-530)

Today’s case involves 28 scientists at the Jet Propulsion Lab, which is run by the California Institute of Technology and conducts space research for NASA.

In 2007, the scientists sued to stop Cal Tech from using federal government background check forms to clear them for work on sensitive NASA projects. The forms, originally developed to run checks on federal employees, asked about past illegal drug use and treatment, and solicited feedback from references about employees’ general fitness to work on government contracts.

The scientists, who say their work doesn’t have national security implications, contended the background checks violate their “informational privacy.”

A federal district judge rejected the scientists’ argument, but the 9th Circuit Court of Appeals ruled in their favor, issuing an injunction against gathering personal background information.

NASA argues that the information gathered on the forms will only be used for employment screening purposes, so the background checks don’t violate employees’ privacy.

While the Supreme Court’s ruling in NASA v. Nelson will technically affect only federal contractors and their employees, court watchers say it could signal whether the court is willing to loosen privacy rights in other kinds of background checks.

Staub v. Proctor Hospital (09-400)

Staub, to be heard Nov. 2, will address a legal principle known as the “cat’s paw” theory of liability. Depending on how the Supreme Court rules, it could have wide implications for employers of all kinds.

The “cat’s paw” theory refers to situations in which a biased immediate supervisor influences an ultimate decision-maker to discipline or fire an employee under seemingly legitimate pretenses.

The case involves Army Reserve member Vincent E. Staub, who was terminated by Linda Buck, HR director for Proctor Hospital in Peoria, Ill. Staub sued, alleging that his firing was influenced by two managers who were biased against him because of his military status. A jury agreed, awarding Staub $57,640.

The hospital appealed, arguing that Buck had no way of knowing the managers were biased against members of the military. It said she had decided to terminate him based on her own, independent investigation of his performance.

The 7th Circuit agreed that Buck independently decided to fire Staub and that, consequently, no liability for alleged discrimination could be imposed on the hospital.

Now Staub has appealed. According to Thomas C. Goldstein, an attorney with Akin Gump Strauss Hauer & Feld, the central question is, “When you have a biased supervisor, when is the company responsible for it? Any company of any size should watch this case carefully.”

Chamber of Commerce of the United States v. Whiting (09-115)

This case, set for argument on Dec. 8, will decide the constitutionality of an Arizona law that requires employers to use the federal government’s voluntary electronic E-Verify employment eligibility verification process and calls for the “corporate death penalty” for companies that employ undocumented workers. Under the Arizona law, companies can have their business licenses revoked if they are caught with ineligible workers.

A host of business groups—including the U.S. Chamber of Commerce, which filed the original lawsuit—oppose the law, noting that E-Verify can’t consistently flag undocumented workers.

Although a Supreme Court ruling against the Chamber of Commerce could legitimize E-Verify (the Obama administration encourages widespread use of the system), it’s more likely that the court’s decision will rest on whether a state can compel use of a voluntary federal program.