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On December 1, 2016, Parker Hannifin Corporation and CLARCOR Inc. announced that the companies have entered into a definitive agreement under which Parker will acquire CLARCOR for approximately $4.3 billion in cash, including the assumption of net debt. The transaction has been unanimously approved by the board of directors of each company. Upon closing of the transaction, expected to be completed by or during the first quarter of Parker’s fiscal year 2018, CLARCOR will be combined with Parker’s Filtration Group to form a leading and diverse global filtration business. Bass, Berry & Sims has served CLARCOR as primary corporate and securities counsel for 10 years and served as lead counsel on this transaction. Read more here.

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Securities Law Exchange BlogSecurities Law Exchange blog offers insight on the latest legal and regulatory developments affecting publicly traded companies. It focuses on a wide variety of topics including regulation and reporting updates, public company advisory topics, IPO readiness and exchange updates including IPO announcements, M&A trends and deal news.

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Labor Talk Blog: Motives Matter: Ignorance is No Defense for Employers in Religious Accommodation Cases

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August 3, 2015

In a recent decision, the Supreme Court of the United States made an important distinction with respect to employment decisions: what matters is not what an employer knows, but why an employer acts. As esoteric as the distinction may seem in the abstract, the ruling has real-world implications for employers encountering an increasingly-diversified pool of applicants and employees.

At issue in the case, EEOC v. Abercrombie & Fitch Stores, Inc., was whether Abercrombie violated Title VII of the Civil Rights Act of 1964 when it refused to hire an otherwise-qualified candidate based on the headscarf she wore to her job interview. Following the interview, Abercrombie's interviewer sought advice from her superiors as to whether the scarf would violate Abercrombie's "Look Policy" that was in place at that time. (The Look Policy included a prohibition against wearing caps.) During her discussion with a manager, the interviewer stated she believed the applicant wore the headscarf for religious reasons. The manager informed her the headscarf violated the Look Policy and instructed the interviewer to forgo hiring the candidate.

The applicant is Muslim and wears the headscarf based upon her religious belief, as the interviewer had assumed. The EEOC sued Abercrombie on the applicant's behalf, alleging Abercrombie violated Title VII when it failed to accommodate the applicant's religious practice of wearing a headscarf. Abercrombie asserted it could not have discriminated against the candidate because it had no knowledge of her need for an accommodation.

In writing for the Court, Justice Antonin Scalia addressed two key points regarding religious discrimination and accommodation under Title VII. First, the Court held Title VII does not incorporate a "knowledge" standard; rather, an applicant is required to show only that her need for an accommodation was a motivating factor in the employer's adverse decision. The Court emphasized this point by contrasting the language of Title VII with that of the Americans with Disability Act, which requires employers to make reasonable accommodations for known physical or mental limitations of an applicant. Second, employers must proactively accommodate religious practices when doing so does not create an undue hardship. Simply treating religious practices as the employer would treat similar secular practices is impermissible. Thus, Abercrombie's argument that it did not discriminate against the applicant because she was subject to the same neutral "no caps" policy as all other applicants failed. Title VII, the Court held, requires employers to provide favored treatment to religious practices.

So where does the decision leave an employer wishing to avoid an assertion it discriminated against an applicant or employee because of that person's religion?

  • Do not act based upon assumptions. Because at issue in a religious discrimination dispute is the employer's motive rather than knowledge, you, as the employer, gain no points for sticking your head in the sand.
  • Make your policies clear, especially if you have concerns an applicant or employee may be unable to comply with those policies. In this instance, the interviewer could have stated the company requires employees to comply with a Look Policy, described the policy briefly (including the "no cap" rule it included), and asked whether there was any reason the applicant could not comply with the policy. (The interviewer could have addressed other store requirements, such as work availability, at this same time.)
  • If an applicant or employee states she is unable to comply with a policy, it is appropriate to inquire as to the reason. If a religious basis is stated, remember you are under an obligation as an employer to accommodate the applicant or employee unless doing so would cause an undue hardship.

As this case shows, willful ignorance will not protect employers from liability for discrimination. But this case also does not provide carte blanche for employers to press applicants and employees for information about their personal religious beliefs and practices. Rather, employers are reminded they must be transparent about their employment policies and expectations. Then, should an employee raise a concern about her ability to comply with a policy, the employer must seek sufficient information to determine whether the employee is entitled to accommodation.

These issues can be complex, placing employers in the unenviable position of determining how much to ask an employee about personal beliefs and practices. Never hesitate to call upon counsel to assist with interpreting employment discrimination law in light of a situation that arises in the workplace. The attorneys in the Labor & Employment Practice Group have experience with these issues and are available to advise employers regarding policy development and implementation.

For more labor and employment information, visit www.BassBerryLaborTalk.com.


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