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Williams v. FCA U.S. LLC

United States District Court, E.D. Michigan, Southern Division

May 24, 2018

MARLIN WILLIAMS, PAMELA WILLIAMS CARTHENS, JEROME THOMSON, PhD, BRENDA DEFORREST, LEVEN WEISS, J.D., MICHAEL D. BROWN, J.D., CORA WILLIAMS, and ANTHONY HILL, on behalf of themselves and all others similarly situation, Plaintiffs,
v.
FCA U.S. LLC, Defendant.

          OPINION AND ORDER GRANTING IN PART AND DENYING IN PART DEFENDANT'S MOTION TO COMPEL ARBITRATION AND DENYING DEFENDANT'S MOTION TO DISMISS AND/OR MOTION TO STRIKE CLASS ALLEGATIONS IN THE SECOND AMENDED COMPLAINT [19]

          LAURIE J. MICHELSON U.S. DISTRICT JUDGE

         Plaintiffs are current and former employees of Fiat Chrysler Automobiles (FCA). They challenge, for themselves and others similarly situated, an employee-evaluation policy they say has a disparate impact on African-American employees. Plaintiffs allege that as a result of this policy, they received lower evaluation scores which resulted in missed career advancements, bonuses, and other employment opportunities. Two plaintiffs additionally bring individual claims of retaliation and discrimination.

         Defendant FCA seeks to compel arbitration pursuant to two arbitration policies. FCA asserts that the potential class members hired prior to the 1995 implementation of an arbitration policy assented to the 1995 arbitration policy when they continued to work at FCA after receiving notice of it. FCA seeks to compel those employees pursuant to either this 1995 policy or the current policy, which was implemented in 2013. And, FCA maintains, the potential class members hired after the implementation of the 1995 arbitration policy assented through their employment applications. FCA seeks to compel those employees to arbitrate pursuant to the current policy (or, impliedly, pursuant to the 1995 policy).

         If the Court does not compel arbitration, FCA moves to dismiss the complaint pursuant to Federal Rule of Civil Procedure 12(b)(6) and to strike the class allegations for failure to meet Rule 23 prerequisites.

         The parties submitted extensive briefing and the Court heard oral argument on November 8, 2017. The United States Supreme Court recently issued an opinion that impacts the arbitration issue and so the Court is now ready to rule. For the reasons that follow, the Court will compel all Plaintiffs except for Leven Weiss and Pamela Williams Carthens to arbitrate and will allow Weiss and Carthens one additional opportunity to amend their complaint to cure any remaining pleading defects.

         I.

         A.

         In 1995, FCA implemented an Employment Dispute Resolution Process (EDRP). (R. 19-4, PID 269.) Shortly before implementing the EDRP, FCA sent non-union employees a letter and brochure informing them of the new policy. (R. 19-4, PID 278-80.) Key to this case is that nonunion employees had to arbitrate most disputes arising from their employment. (R. 19-4, PID 271- 77.)

         Two plaintiffs, Leven Weiss and Pamela Williams Carthens, were hired by FCA before the 1995 implementation of the EDRP. To be more precise, Weiss was hired in 1985 and Carthens in 1986. (R. 8, PID 65-67.) Their employment applications stated that if they were hired, they would comply with all of FCA's orders, rules, and regulations. (R. 19-2, PID 250, 252.) Both signed the application and accepted employment. (Id.)

         The remaining plaintiffs were all hired after the implementation of the first EDRP in 1995. Dr. Jerome Thompson was hired by FCA around 1997 (R. 8, PID 66), Anthony Hill was hired around 2000 (R. 8, PID 67), Brenda DeForrest was hired around 2002 (R. 19-2, PID 244), Michael Brown was hired around 2010 (R. 8, PID 67; R. 19, PID 196), and Cora Williams (C. Williams) was hired around 2012 (R. 8, PID 67; R. 19, PID 196). Each filled out employment applications stating that, if they were hired, they would comply with the EDRP. (R. 19-2, PID 241-42, 244, 246, 248.) The applications further stated that they agreed to bring any lawsuit arising out of their employment with FCA within six months or 180 days. (Id.). These five plaintiffs signed the employment applications and accepted employment. (Id.)

         In 2013 FCA modified the EDRP. (See R. 19-2.) Plaintiff Marlin Williams (“M. Williams”) was hired after the implementation of that 2013 EDRP, around January 2015. (R. 8, PID 65; R. 19, PID 196.) As part of her online application, M. Williams signed a form agreeing that she received and reviewed the EDRP and that she agreed to be bound by and comply with the EDRP. (R. 19-2, PID 240.) Unlike the other employment applications, this application contained an acknowledgement form which included an electronic link to the 2013 EDRP. (R. 19-2, PID 240.) M. Williams' application also stated that she agreed to bring any lawsuit arising out of her employment with FCA within six months or 180 days. (R. 19-2, PID 240.)

         In 2015, FCA promoted M. Williams to Diversity Manager and asked her to assume many of the duties of her predecessor, Georgette Burrego Dulworth. (R. 8, PID 71.) M. Williams, unlike Ms. Dulworth, is African American. (R. 8, PID 71.) Despite taking on Dulworth's duties, FCA never gave M. Williams the title of “Director, ” never promoted her, nor gave her any “additional perks” that came with a director-level position. (R. 8, PID 71.)

         As part of her job responsibilities, M. Williams learned that FCA employees are subject to a two-step evaluation process. (R. 8, PID 73.) First, an employee's direct supervisor rates each employee's performance as “High, ” “Medium, ” or “Low.” (R. 8, PID 73-74.) This is known as the Performance and Leadership Management Rating (PLM Rating). (R. 8, PID 74.) Second, management provides a numerical score, known as a Performance and Leadership Management Score (PLM Score). (Id.)

         During this second step, termed the “calibration process, ” Plaintiffs say FCA managers can see the employees' headshots. (R. 8, PID 79.) The PLM Score rates employees on a one-to-nine scale. (Id.)[1] Scores are then adjusted according to a recommended or “forced” distribution curve. (R. 8, PID 75.) An employee who scores below a five can be placed on a Performance Improvement Program or be terminated. (R. 8, PID 74.) The higher the score, the higher the bonuses, additional pay, and chances of advancement opportunities. (R. 8, PID 75.)

         M. Williams observed that, on a company-wide basis, the two-step evaluation process treated salaried, non-union, non-African-American employees more favorably overall “as to their compensation, ratings, advancement opportunities, terms, and conditions, than similarly-situated African-American employees.” (R. 8, PID 75.) She also observed that African-American employees received lower scores, at five or below, at a disproportionate rate compared to non- African Americans. (R. 8, PID 76.) M. Williams then discovered that her own PLM Rating was downgraded after the calibration process. (R. 8, PID 76.)

         As a result of this process, it is alleged, Plaintiffs and those similarly situated were disproportionately given lower PLM Scores of five and below and were given lower scores overall compared to non-African-American employees. (R. 8, PID 76-77.)

         M. Williams reported the disparate impact to senior leadership. (R. 8, PID 77.) She alleges that, in retaliation, FCA accused her of underperforming, placed her under investigation, and “ostracized and essentially excommunicated her from her colleagues and upper management.” (R. 8, PID 78.) M. Williams submitted her two-week notice on January 2, 2017, but was terminated the next day. (R. 8, PID 78.)

         C. Williams also questioned her score to human resources and upper management. She says FCA retaliated by placing her on a Performance Improvement Plan. (R. 8, PID 79.)

         This prompted C. Williams to seek relief from the Equal Opportunity Employment Commission. In particular, on June 8, 2016, C. Williams filed an EEOC charge alleging racial discrimination based upon FCA's policies and practices. (R. 19-3, PID 266.) On December 2, 2016, she was terminated. (R. 19-3, PID 267.) C. Williams then filed another EEOC complaint on December 13, 2016. (R. 19-3, PID 267.) She received her Right to Sue letters for the EEOC complaints on February 22 and February 24, 2017. (R. 8-2, PID 103-104.)

         Shortly after, M. Williams filed an EEOC complaint alleging that “I and others have been subject to different terms and conditions of employment and that I have been constructively discharged due to my race, African American, and in retaliation for having participated in a protected activity.” (R. 19-3, PID 268.) On March 9, 2017, M. Williams received a Right to Sue letter. (R. 8-1, PID 100.)

         Plaintiffs filed a second-amended complaint on March 16, 2017 alleging class-wide relief for disparate impact prohibited by Title VII and ELCRA; violations of 42 U.S.C. § 1981; retaliation against M. Williams and C. Williams prohibited by Title VII and ELCRA; and termination of C. Williams prohibited by Title VII and ELCRA. (R. 8.)

         Plaintiffs have also filed, under seal, data from FCA relating to the evaluation ...


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