Daily Labor Report®

Kennedy’s Legacy in Employment Law, What’s Next

June 29, 2018, 6:45 PM

U.S. Supreme Court Justice Anthony Kennedy announced his retirement only hours after the court handed down its 5-4 ruling June 27 that public employees don’t have to pay “fair share” union fees.

Kennedy has been hailed for years as the court’s swing vote on major social disputes, and his lasting impact in the employment law arena will be seen as generally conservative and pro-employer, attorneys tell Bloomberg Law.

This term alone, Kennedy voted with the conservative block on Janus v. AFSCME Council 31Trump v. Hawaii, and Epic Systems Corp. v. Lewis, all of which were 5-4 decisions along ideological lines. Kennedy also sided with the conservative justices on Wal-Mart Stores, Inc. v. Dukes  in 2011, a decision that narrowed the definition of the commonality requirement of class actions. He joined the conservative bloc again in NLRB v. Noel Canning in 2014, holding that President Barack Obama’s three recess appointments to the National Labor Relations Board were unconstitutional due to the short length of the recess in question.

But Kennedy’s openness to other ideas and points of view are what make him important as a jurist for the labor and employment bar, Paul Mollica, of counsel with Outten & Golden in Chicago, said. Mollica is a plaintiff’s side attorney who has written numerous friend-of-the-court briefs before the high court in employment cases.

“He was the least predictably pegged of the justices. He was the one who needed to be persuaded. People would say, ‘you’re arguing for Kennedy’ or ‘you’re writing briefs for Kennedy,’” Mollica told Bloomberg Law.

Kennedy is best known for his decisions in gay rights cases— Romer Lawrence Windsorand  Obergefell —that “moved the needle” on the issue of parsing sexual orientation discrimination disputes in the workplace, Rae Vann, a partner with NT Lakis in Washington, told Bloomberg Law. Vann represents employers and also serves as general counsel of the Center for Workplace Compliance, an employers’ association that files friend-of-the-court briefs in workplace cases.

It’s in part Kennedy’s work in the gay rights area that has contributed to the present circuit court split on whether Title VII of the 1964 Civil Rights Act protects against sexual orientation discrimination, Mollica said.

A previous Bloomberg Law analysis showed Kennedy being more even-handed in employment discrimination cases than some of his fellow justices. He fell between pro-employer Justices Clarence Thomas and the late Antonin Scalia, and pro-worker Justices Sonia Sotomayor and Ruth Bader Ginsburg.

His protection of individual liberties, as demonstrated by his votes on gay rights and abortion rights issues, gave some observers hope that his views on discrimination against the LGBTQ community in the workplace “would be equally progressive,” Michael Foreman, director of the Civil Rights Appellate Clinic at Penn State Law, said.

“His retirement obviously will directly impact those issues,” Foreman told Bloomberg Law.

His likely replacement by a justice appointed by President Donald Trump and confirmed by a GOP-controlled Senate “does not bode well for those in favor of a more expansive reading of Title VII,” Vann said.

Look Ahead: More Arbitration Showdowns

Prior to Kennedy’s retirement announcement, the high court agreed to review four cases related to labor and employment in the upcoming 2018-2019 term. Two involve arbitration issues, while the other two implicate federal age bias and railroad tax laws. The cases pose the following questions:

  • Whether an employment contract that’s silent on the issue of class arbitration can be construed in favor of workers seeking class proceedings (Lamps Plus Inc. v. Varela)

  • Whether interstate truck drivers must arbitrate their federal wage-and-hour claims and whether it’s the job of a court or an arbitrator to decide if a Federal Arbitration Act exemption for transportation workers applies to drivers’ employment contracts (New Prime Inc. v. Oliveira)

  • Whether state political subdivisions with less than 20 employees, such as a fire district, must adhere to discrimination protections under the Age Discrimination in Employment Act (Mt. Lemmon Fire District v. Guido)

  • Whether a railroad’s payment to an employee for lost work time is taxable under the Railroad Retirement Tax Act (BNSF Railway Co. v. Loos)

The outcomes of the cases could depend on how quickly Trump nominates, and the Senate confirms, Kennedy’s successor. If only eight justices are sitting on the bench when these cases are decided, any 4-4 splits would mean that the appeals court’s ruling below stands.

Supreme Court observers have previously noted that the conservative justices, including Kennedy, have been deferential to arbitration agreements in recent cases. In the past term, for example, Kennedy sided with the conservative block in ruling that employers can require workers to use individual arbitration instead of class mechanisms to pursue legal claims.

Replacing Kennedy with a solidly conservative justice could mean more employer wins in future arbitration cases—including the two on tap for the next term. The high court will return in September to grant more cases for the upcoming term.

Orientation Bias Among Pending Petitions

The remaining justices may also proceed with caution in granting review of arguably controversial cases before a ninth justice is seated. There are about 24 petitions in labor and employment law cases currently at the court. That number will likely increase over the summer during the court’s recess.

Two pending petitions—seeking review of rulings by federal appeals courts in New York and Georgia—bring back the question of whether Title VII’s sex discrimination protections encompass bias based on sexual orientation. The justices punted that issue last December.

Other pending petitions ask the justices to decide whether federal law bars Los Angeles from requiring businesses to agree to labor provisions before they can operate at LAX Airport and when certain successorship rules apply in labor cases.

To contact the reporters on this story: Porter Wells in Washington at pwells@bloomberglaw.com; Jay-Anne Casuga in Washington at jcasuga@bloomberglaw.com

To contact the editor responsible for this story: Terence Hyland at thyland@bloomberglaw.com

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