Minnesota Cities Magazine

From the Bench: A Case of Age Discrimination?

EMPLOYMENT LAW
Age Discrimination in Employment Act

A three-member civil service commission used a three-part assessment to hire the city’s new police chief. JA15ageCandidates were scored for years of service, training and employment, and their interview. One of the final four candidates was Hilde, the city’s only police lieutenant, who had worked for the city for 29 years. Hilde had served as the acting chief, had an associate’s degree in law enforcement, and had completed all the advanced training available. Another candidate was Koivunen, a detective with another city, who had 18 years’ experience and a bachelor’s degree in criminal law.

Before the interview, Hilde led Koivunen in points, 74 to 43. Hilde had a years-of-service score of 65, and Koivunen had one of 28. With regard to training and employment, Hilde had a score of 9 out of 20 and Koivunen had 15. Koivunen received a perfect score on the interview, and the original interview score for Hilde was reduced by the commissioners retroactively. Hilde was 51 years old and was immediately eligible for retirement. Koivunen was 43 years old. One commissioner said that retirement eligibility “might have” been a factor in the commission’s decision. The city ultimately hired Koivunen.

Hilde sued under the Age Discrimination in Employment Act, claiming that his age was the reason he was not hired. The district court granted summary judgment in the city’s favor, holding that Hilde had not established a prima facie case because Koivunen was not “substantially” younger than Hilde. The 8th U.S. Circuit Court of Appeals reversed, holding that Hilde had established a prima facie case and that there were material fact questions about whether the city’s stated reason for not hiring Hilde was pretextual. Hilde v. City of Eveleth, 777 F.3d 998 (8th Cir. 2015). Note: LMCIT represented the city.

CONSTITUTIONAL LAW
Special service district

Under Chapter 428A of the Minnesota Statutes, a city may by ordinance establish a “special service district,” which is “a defined area within the city where special services are rendered and the costs of the special services are paid from revenues collected from service charges imposed within that area.” The City Council adopted an ordinance establishing a special service district in a section of its downtown, called the Downtown Business Improvement Special Service District (DID). The City Council subsequently adopted a resolution imposing service charges and enhanced services in the DID. Some affected property owners sued, claiming in part that the charges were an unconstitutional taking because they exceeded the “special benefit” to their properties measured by the increase in market value because of the special services provided.

The district court ruled in the city’s favor, and the Minnesota Court of Appeals affirmed. The Court of Appeals held that service charges imposed under Chapter 428A are not subject to the common law “special benefit” test that applies to special assessments for local improvements. Instead, the Court of Appeals held that they are subject to the standard set forth in Minnesota Statutes, section 428A.02, subdivision 3, which requires service charges to be “reasonably related to the special services provided” and “proportionate to the cost of furnishing the service.” 110 Wyman, LLC v. City of Minneapolis, N.W.2d (Minn. Ct. App. 2015).

LAND USE
Conditional use permit

RDNT applied for a conditional use permit (CUP), seeking to significantly expand its existing senior living facility. The city denied the application, concluding it “conflicts with numerous sections of the Comprehensive Plan” and “would be injurious to the surrounding neighborhood or otherwise harm the public health, safety, and welfare.” The Minnesota Court of Appeals upheld the city’s denial, and the Minnesota Supreme Court affirmed.

The Supreme Court held that the city’s conclusion that the proposed expansion would be injurious to the surrounding neighborhood or would otherwise harm the public health, safety, and welfare was not unreasonable, arbitrary, or capricious. The Supreme Court also held that the city’s decision that the landowner’s proposed mitigating conditions were insufficient was not unreasonable, arbitrary, or capricious. The Supreme Court noted that the language of the CUP statute places the burden on the applicant to satisfy the standards and criteria in the ordinance and does not require a city to agree to mitigating conditions proposed by a landowner. The Supreme Court also clarified that if there is any conflict between the CUP statute and case law from cases decided before the CUP statute’s adoption in 1982, the CUP statute controls. The Supreme Court’s majority opinion did not address the city’s alternative reason for denial based on conflicts with the city’s Comprehensive Plan. RDNT v. City of Bloomington, 861 N.W.2d 71 (Minn. 2015). Note: LMCIT represented the city, and LMC filed an amicus curiae brief in its support.

EMPLOYMENT LAW
Pregnancy Discrimination Act

Young became pregnant while working as a part-time driver for UPS and told the company that her doctor had instructed her not to lift more than 20 pounds. UPS requires its drivers to lift up to 70 pounds, and refused to authorize Young’s pro¬posed 20-pound restriction. Young sued under the Pregnancy Discrimination Act, which prohibits discrimination because of pregnancy and requires employers to treat pregnant workers the same for all employment-related purposes as non-pregnant workers that are “similar in their ability or inability to work.” Young sued under a disparate-treatment theory, claiming that the company had accommodated other drivers with similar work restrictions because of injuries on the job, disabilities covered by the Americans with Disabilities Act, or loss of DOT certifications. UPS replied that because Young did not fall within any of those categories of employees, she was treated the same as all other relevant employees.

The lower courts granted summary judgment in UPS’s favor. The U.S. Supreme Court reversed and remanded for further proceedings, holding that Young had presented sufficient evidence to create a factual dispute regarding whether UPS had treated at least some similarly situated workers more favorably. The Supreme Court held that a pregnant worker who seeks to show disparate treatment under the Pregnancy Discrimination Act may do so under the McDonnel Douglas burden-shifting framework.

Under this framework, an employee may present a legal claim by showing that she was pregnant, sought accommodation, was not accommodated, and that the employer did accommodate other non-pregnant employees similar in their ability or inability to work. The employer may then seek to justify the refusal to accommodate based on legitimate, non-discriminatory grounds. The employee may then create a genuine issue of material fact by showing that the employer’s justifications are pretextual and are not sufficiently strong to justify the burden placed on pregnant workers. Young v. United Parcel Service, Inc., 135 S.Ct. 1338 (2015).

CONTRACT LAW
Payment bond

The city contracted with Albers Mechanical Services to install a boiler. Albers purchased a boiler from Goodin Company and installed it, but Albers filed for bankruptcy and failed to pay for the boiler. Goodin Company sued the city for payment, claiming it was required to pay under the Public Contractors’ Performance and Payment Bond Act. The district court ruled in the city’s favor and dismissed the lawsuit. Goodin Company appealed, claiming that a public body is liable to subcontractors and suppliers under the Public Contractors’ Performance and Payment Bond Act whenever it fails to obtain a payment bond from the general contractor. The Minnesota Court of Appeals affirmed the district court’s decision and held that a public body is only liable to third-party suppliers when a payment bond is required and that no payment bond was required in this case because the cost of the project did not exceed the statutory $100,000 threshold. Goodin Co. v. City of Prior Lake, No. A14-1144 (Minn. Ct. App. Mar. 8, 2015) (unpublished opinion).

LAND USE
Conditional use permit

Restore House, a chemical-dependency treatment facility, applied for a conditional use permit (CUP), seeking to increase its capacity from six to nine residential clients. The Township Board denied the application based on several findings relating to the facility’s lack of compliance with CUP standards. Restore House appealed the decision, challenging the township’s stated reasons for denial. The Minnesota Court of Appeals upheld the township’s decision, concluding that its reasons for denial were not decisive because the township’s ordinance does not allow Restore House’s proposed use in its zoning district. Therefore, the Board did not have legal authority to issue the proposed CUP regardless of its reasons for denial. Restore House, Inc. v. Helga Township, No. A14-0901 (Minn. Ct. App. Dec. 22, 2014) (unpublished opinion).


Written by Susan Naughton, research attorney with the League of Minnesota Cities. Contact: snaughto@lmc.org or (651) 281-1232.

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