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You Better Watch Out: Employer Left Holding the Bag for Retaliatory Refusal to Hire Prospective Employee Who Had Sued Previous Employer for Discrimination

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We all know that the Washington Law Against Discrimination (the “WLAD”) prohibits an employer from discharging, expelling, or otherwise discriminating or retaliating against a person because he or she has opposed practices forbidden by the WLAD. The Washington Supreme Court has now extended that protection to prospective employees, holding that the WLAD provides a cause of action for job applicants who claim that a prospective employer refused to hire them in retaliation for prior opposition to discrimination against a different employer. Zhu v. North Central Educational Service District—ESD 171, No. 94209-9 (Wash. Nov. 9, 2017). The facts of the case provide a cautionary tale for employers.

Facts of the Case

Zhu, a U.S. citizen who had emigrated from China in 2004, was hired as a math teacher by the Waterville school district. Zhu subsequently filed multiple grievances with Waterville regarding hostile and abusive actions by his students, including using racial, political, and gender-based epithets, circulating inappropriate cartoons about Zhu, and scrawling hateful racial attacks against Zhu on a bathroom wall. Zhu alleged that instead of remedying the situation, Waterville retaliated against him for filing the grievances, including an attempt to discharge him without probable cause. Zhu sued the Waterville school district in federal district court, alleging racially motivated disparate treatment, hostile work environment, and retaliation under the WLAD.

Subsequently, Zhu applied for a teaching position with the North Central school district. It was undisputed that members of the school district’s hiring committee were aware of Zhu’s lawsuit against Waterville. Zhu was one of three candidates interviewed for the job, but North Central hired a different candidate, who Zhu claimed was far less qualified for the position. Zhu sued the North Central school district in federal court, alleging that its refusal to hire him was retaliatory for his prior lawsuit against Waterville, thereby violating the WLAD’s antiretaliation statute. Zhu prevailed on his WLAD antiretaliation claim at a jury trial and was awarded damages.  On posttrial motions, the federal district court certified a legal question to the Washington Supreme Court, asking whether the WLAD provides a cause of action to a prospective employee against a prospective employer not involved in the underlying discrimination claim. 

The Washington Supreme Court answered “yes,” holding that the WLAD creates a cause of action for job applicants who claim that a prospective employer refused to hire them in retaliation for prior opposition to discrimination against a different employer. The Court rejected the North Central school district’s argument that the WLAD should be limited to current employers only. The Court noted that, for purposes of the WLAD, “employer” is broadly defined as “any person acting in the interest of an employer, directly or indirectly, who employs eight or more persons,” that an “employer” is not limited to the plaintiff’s current employer under the WLAD’s antiretaliation provisions, and that the WLAD clearly includes prospective employers.

The Court recognized that the WLAD’s antiretaliatory prohibition would be limited to actions that employers or “other persons” undertake in their capacity as employers.  The Court noted: “It does seem unlikely that the statute contemplates a cause of action against someone who engages in retaliatory discrimination against a purely social acquaintance in a purely social capacity, even if the discriminator otherwise happens to be an employer.” That limitation did not help the school district, however, because a refusal to hire is unquestionably an action taken by an employer in its capacity as such. “If prospective employers are allowed to engage in retaliatory refusals to hire, a reasonable employee might well be dissuaded from opposing discriminatory practices for fear of being unofficially 'blacklisted' by prospective future employers.”
 
What This Means for Employers

Employers may want to consider additional screening protections in their hiring process to prevent a repeat of the Zhu scenario. When employers are conducting background checks on applicants, employers might consider implementing a process whereby background screening is performed by a human resources manager who is not participating in the hiring decision. The manager can then provide the hiring decision-makers only with relevant information from the background check, which does not include information on prior lawsuits by the applicant or other data that the decision-makers would be prohibited from considering in making the hiring decision (such as age, race, national origin, or gender). 

In Zhu’s case, it was undisputed that the North Central school district was aware of his prior lawsuit against the Waterville school district. In those types of situations, the employer might consider implementing a “blind” decision-making process, whereby the committee reviews only the qualifications of the applicants, not their names, other personal identifying information, or any information that might identify any protected status of the applicant, including race, national origin, gender, or whether the applicant had previously sued a prior employer for retaliatory discrimination. When in doubt, contact your legal counsel for specific guidance.