Fall 2004-12 Pregnancy discrimination by bank

Number 57
Fall 2004

Pregnancy discrimination by bank

Pregnancy discrimination is the topic of a recent decision entered by the Court of Appeals for the First Circuit in Boston, C umpiano v. Banco Santander, 902 F. 2d 148 (1st Cir. 1990). The court upheld Puerto Rico’s Federal District Court’s reinstatement and back pay award in favor of a managerial employee of Banco Santander.

The employee had brought a sex discrimination claim alleging that she had been discharged because of her pregnancy. Under Title VII of the Civil Rights Act of 1964, discrimination on the basis of pregnancy is specifically prohibited as a modality of sex discrimination. The case raises interesting legal issues, among them, the interplay between sex discrimination and potential sexual harassment claims.

“An amorous relationship”

The employee was hired in 1978, and shortly thereafter, the court said, “became enmeshed in an amorous relationship” with the assistant comptroller, who was married. The affair was open and notorious, and the couple had a child born out of wedlock in 1982. The opinion points out that despite management’s knowledge about the affair, the employee was not reprimanded nor told to discontinue the relationship.

In 1986 the employee returned from vacation “in maternity clothes and visibly pregnant.” At that time she was promoted. A few weeks later, both lovers were fired. When she requested an explanation, the employee was told by the human resources director, who had made the decision to terminate, that “he did not wish to discuss things she already knew.”

The bank’s defenses

The bank presented several defenses to uphold the discharge. First, it alleged that the employee was fired for violation of a rule requiring employees to “maintain at all times conduct characterized by decency and public morality.” The rule applied to any “conviction of a crime that involves moral depravation, or that involves conduct which in the bank’s judgment disqualifies the employee from continuing performance at his/her post.” The bank argued that the employee’s conduct amounted to adultery. The circuit court refused to accept this justification because, it stated, the conduct had been condoned for years, and action had not been taken against the employee until she became pregnant for the second time. Moreover, the rule was considered inapplicable because this employee had never been convicted of adultery.

Another important defense dealt with the possibility that the employee could have filed a quid pro quo sexual harassment claim, alleging that the assistant comptroller had forced her to engage in the affair in exchange for favors or under the threat of reprisals. The bank also argued that other employees could have made a claim alleging that the affair’s pervasive sexuality had created a hostile environment. The judges pointed out that the bank had not acted previously against the lovers, despite the fact that any sexual harassment claim could have been presented long before the discharge. Moreover, dismissing the assistant comptroller was sufficient to end the danger of a sexual harassment claim.

The circuit court also ruled that the employee’s failure to prove that she was replace by a non-pregnant person was not an essential element of the prima facie case of discrimination. It is sufficient, it was noted, that the employee show that “the employer had a continued need for ‘someone to perform the same wok after [the complainant] left.'”

In rejecting the bank’s argument that the District Court had not considered evidence to show that it had discriminated against other pregnant women, the appellate court explained that such evidence did not preclude a finding of discrimination, since there is always a first time.

‡‡ Note:

This important appellate court opinion seems to underline the need to deal timely and appropriately with situations involving workplace romances, lest acquiescence hinder the employer from being able to act subsequently. Nevertheless, as in every case, careful consideration should be given to any disciplinary action to be taken and its implementation, to lessen the risk that a court will question the bank’s decision.

© 2004 Goldman Antonetti