New England Biz Law Update
An employee who executed a release as part of his severance package could not later sue his former employer for discrimination, the Rhode Island Supreme Court has ruled.
The employee argued that the release was void under the Rhode Island Fair
Employment Practices Act, G.L. §28-5-24.1(d).
But the Supreme Court disagreed and affirmed an award of summary judgment in the employer’s favor.
“[W]e hold that the clear and unambiguous language of §28-5-24.1(d) does not apply to the action taken by the Superior Court in the instant case,” Justice William P. Robinson III wrote for the unanimous court. “It is not our role to contort the language of an unambiguous statute in order to include within its reach a situation which it plainly does not encompass.”
The 17-page decision is Olamuyiwa v. Zebra Atlantek, Inc., et al.
Warwick attorney Robert E. Savage represented the employee. The employer was defended by Douglas Darch of Chicago.
Layoff paperwork
Plaintiff Tijani A. Olamuyiwa, an African-American male of Nigerian origin, was hired by defendant Atlantek, Inc. as a technician. When Zebra Technologies Corp. later acquired Atlantek, the plaintiff remained in his position.
When the plaintiff was notified by letter that Zebra Technologies would be laying off employees, he filed a charge of discrimination with the Rhode Island Commission for Human Rights. The bias charge included a statement that the plaintiff was represented by an attorney.
The plaintiff was laid off on April 29, 2005. He received a “Letter Agreement” setting forth the “separation benefits,” as well as a second document entitled “Confidential Waiver and Agreement and General Release.”
Under the terms of the letter agreement, the employee’s receipt of the separation benefits was “contingent on” the receipt by Zebra Atlantek of a signed copy of the release document. The amount of money that the plaintiff was to receive as separation benefits was his “base pay rate of $492.00 … weekly, for a period of six (6) weeks.”
The release document included provisions (1) releasing Zebra Atlantek and its present and former employees from liability for counsel fees and (2) discharging all claims that the employee “may have against” those parties — including but not limited to any claims under the FEPA.
The letter agreement stated that the employer “encourages you to consult with an attorney regarding this Letter Agreement and the enclosed Waiver/Release, if you so desire.”
The plaintiff signed the documents a few days later and mailed them to Zebra Atlantek.
The court observed that it was “undisputed that plaintiff never consulted with his attorney before signing the documents and that his attorney was not aware of the release document until a few weeks after plaintiff had executed it.”
On Aug. 30, 2005, the Commission for Human Rights issued a “Notice of Right to Sue” to the plaintiff. In November, the plaintiff commenced an action in Superior Court alleging that he had been discriminated against on the basis of his race, color and ancestral origin in violation of the FEPA and the Rhode Island Civil Rights Act.
The defendants moved for summary judgment, contending that the plaintiff had signed a valid and binding release and had thereby waived the claims he was seeking to litigate.
Finding that there was “nothing in FEPA that voids the Release,” Superior Court Judge O. Rogeriee Thompson allowed the summary judgment motion.
Legislative choices
The plaintiff claimed on appeal that “FEPA requires that plaintiff’s counsel had to attest ‘that there wasn’t a waiver of attorney’s fees as a condition of settlement both at the Commission and at the Superior Court.” Since there had been no such attestation by counsel, his argument went, the result was “a void settlement.”
The plaintiff’s theory was based in part on G.L. §28-5-17(d), which relates to the conciliation of charges before the commission. That provision prohibits the commission from entering a consent order or conciliation agreement settling claims of discrimination in an action or proceeding “unless the parties and their counsel attest that a waiver of all or substantially all attorneys’ fees was not compelled as a condition of the settlement.”
The plaintiff also cited §28-5-24.1(d), which relates to actions that might be taken by the Superior Court rather than by the commission. That section states that the Superior Court “shall not enter a consent order or judgment settling claims of discrimination in an action or proceeding under this chapter, unless the parties and their counsel attest that a waiver of all or substantially all attorney’s fees was not compelled as a condition of the settlement.”
Relying on those two sections, the plaintiff maintained that the attorney who represented him at the time when he signed the release document was “de facto require[d]” to have been provided with actual knowledge of “any proposed agreement” between the plaintiff and Zebra Atlantek.
According to the plaintiff, “it is contrary to the intent of the FEPA to hold that the FEPA permits defendant-employers to resolve pending FEPA claims by entering into an out-of-court agreement ‘that is conditioned on a waiver of attorneys’ fees without giving plaintiff’s attorney actual notice of the agreement.’”
The Supreme Court, however, found §28-5-17(d) inapplicable.
“In the case at hand, … in no sense was the release document that was signed by plaintiff (which document provided for the waiver of potential claims for attorneys’ fees) ‘a consent order or conciliation agreement’ entered by the Commission,” Robinson stated.
“The release document was part of a settlement agreement between two private parties (plaintiff and Zebra Atlantek), and there was absolutely no involvement by the Commission with respect to that agreement,” the judge wrote. “Moreover, it is undisputed that the only action undertaken by the Commission in relation to the instant matter was to issue a ‘Notice of Right to Sue,’ which notice was neither a consent order nor a conciliation agreement.”
The Supreme Court went on to address the plaintiff’s contention that the Superior Court judgment was contrary to §28-5-24.1(d) because it essentially enforced the release document.
“It is clear that that provision applies only in instances where the court enters a consent order or a judgment settling a claim based on the FEPA,” Robinson said. “The plaintiff does not contend that a consent order was entered by the Superior Court in this case, and we certainly do not view the entry of summary judgment in favor of a party to be in any sense a consent order.”
Although the Superior Court judge entered a judgment, “the judgment which was entered in favor of defendants did not ‘settle’ the claims of discrimination; rather, it constituted a dismissal of plaintiff’s claims against defendants in the context of a judgment on the merits,” Robinson added. “The judgment in this case was not the product of the parties having ‘come to an agreement.’ Rather, the Superior Court ruled that defendants were entitled to judgment after considering the arguments of the parties at a hearing on a motion for summary judgment — an inherently adversarial proceeding quite distinct from the pacific and cooperative characteristics of the settlement process.”
The plaintiff went on to assert that Judge Thompson “focused on ‘mere form over substance’ and thereby rendered the cited provision of the FEPA meaningless when she ruled that the waiver of attorneys’ fees was not contained in what the statute refers to as a ‘judgment settling claims,’ but rather in what the court characterized as a ‘contract that was not intended to directly settle Plaintiff’s then pending FEPA claims.’”
But the Supreme Court once again was not convinced, finding that the language of the statutory provision the plaintiff relied on was clear and unambiguous, “and the language of that statute does not by any stretch of the imagination provide any support for plaintiff’s contention.”
Robinson wrote that if the General Assembly “desired to extend the attestation by counsel requirement to a situation such as the instant case presents, we do not doubt that it could have done so; but the blunt fact is that it did not do so.”
