Out-of-Town Transfer Could be Constructive Discharge

December 9, 2009 (PLANSPONSOR.com) – A federal appellate court has breathed new life into a suit brought by a former United Airlines HR analyst who claims she was effectively fired from the air carrier’s Denver station after she found potential financial improprieties in HR records.

The 10th U.S. Circuit Court of Appeals did so by throwing out a lower court order by U.S. District Judge Robert E. Blackburn who had ruled in favor of the airline after finding that plaintiff Mary Barone did not prove her employer had actually taken an adverse action against her when she left the company in August 2006.

The appellate judges ruled instead that Barone had put forward a sufficiently strong showing that she had been a victim of gender discrimination and that her leaving the company represented unlawful retaliation. According to the appellate ruling, Barone conducted audits of HR records of United’s Denver employees and eventually found potential problems in pay and hours worked.

The 10th Circuit panel said the case turned on an August 17, 2006, meeting involving Barone and her supervisors during which she was informed that she could either move to Orange County, California, to work as a part-time customer service agent or resign.

“We conclude that forcing a management employee with a successful performance record to choose between resigning and relocating across several states to continue her employment in a part-time and nonmanagement capacity effectively changed Barone’s employment status,” the 10th Circuit panel wrote. “United compelled Barone to choose between two undesirable options…. Thus, in the light most favorable to Barone, it is clear that Barone’s demotion and transfer to Southern California was not a mere threat but a final decision of her employer, to take effect immediately should Barone refuse to resign.”

The appellate judges decided that Barone could move forward with her constructive discharge allegations and sent the case back to the trial court for further proceedings.

The 10th Circuit ruling is available here.