E-Newsletter

March 2008

Seventh Circuit Court of Appeals Allows a Disability Claim of Discrimination by Association to Proceed to Trial

Brian M. Radloff, Esq.
bmr@kclegal.com

Under the Americans with Disabilities Act (ADA), an employer is prohibited from discriminating against an individual because of the employee's relationship or association with an individual who has a known disability.

In a Seventh Circuit Court of Appeals case decided on February 27, 2008, the Court allowed an expense based claim to proceed to trial. An employee, Phillis Dewitt, was a nurse at Proctor Hospital in Peoria, Illinois. She received health benefits as part of her compensation. Her husband, Anthony, was a covered beneficiary. The hospital was self-funded for medical expenses up to a cap of $250,000. Anything over that amount was covered by a stop-loss policy.

Anthony was suffering from prostate cancer and had incurred substantial medical costs in the treatment of that cancer over the course of several years. In addition, the hospital was in a financially precarious position and had made that fact known to its employees in a meeting where managers were told that the hospital needed a "creative effort" to cut costs. Dewitt's supervisor had also asked her several times about the medical status of her husband and one time mentioned that a hospice center may be a less expensive alternative for his care. On another occasion, the supervisor mentioned that a committee was reviewing Anthony's unusually high medical expenses, which had exceeded $177,000 in the previous year. Within three months of these comments, and despite positive performance reviews, Dewitt's employment was terminated.

Dewitt then filed an association discrimination claim under the ADA and argued that the hospital terminated her to limit its exposure to the substantial medical expenses of her husband. The Seventh Circuit Court agreed that an employer who terminates an employee because his/her spouse has a costly disability may be in violation of the association discrimination provision of the ADA and sent the matter back to the district court for a trial.

Employers must remember that an employee who is not disabled under the ADA may still be covered by the protections of the ADA because of his/her relationship or association with an individual who has a disability. These types of claims are still in their infancy, but employees, and their attorneys, may resort to these claims if the circumstances permit, and employers should be ready for them.

For more information about this decision or other employment law issues, contact educational services at (414)423-1330.