Amended August 2, 2017 Simon Seeding & Sod, Inc. v. Dubuque Human Rights Commission and Jermaine Stapleton ( 2017 )

IN THE SUPREME COURT OF IOWA
No. 16–1014
Filed May 19, 2017
Amended August 2, 2017
SIMON SEEDING & SOD, INC.,
Appellant,
vs.
DUBUQUE HUMAN RIGHTS COMMISSION
and JERMAINE STAPLETON,
Appellees.
Appeal from the Iowa District Court for Dubuque County,
Michael J. Shubatt, Judge.
Employer appeals district court judgment upholding local
commission’s award of damages to former employee for racial
discrimination. DISTRICT COURT JUDGMENT AFFIRMED.
Erik W. Fern of Putnam, Fern & Thompson Law Office, P.L.L.C.,
Decorah, for appellant.
Les V. Reddick of Kane, Norby & Reddick, P.C., Dubuque, for
appellee Dubuque Human Rights Commission.
Charles Gribble and Christopher Stewart of Parrish Kruidenier
Dunn Boles Gribble Gentry Brown & Bergmann, L.L.P., Des Moines, for
appellee Jermaine Stapleton.
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WATERMAN, Justice.
In this appeal, we must decide how to count employees to reach
the threshold “numerosity” required to apply a local civil rights ordinance
to a small business. The Dubuque ordinance, with language matching
the Iowa Civil Rights Act (ICRA), exempts “any employer who regularly
employs less than four individuals.” The defendant, a landscaper whose
hiring needs fluctuate seasonally, denies it met this threshold under its
proposed formula of counting only workers who had been employed for
twenty consecutive weeks. The Dubuque Human Rights Commission
(DHRC) rejected the employer’s numerosity challenge, found the
employer racially discriminated against a temporary worker, and
awarded damages. The district court affirmed. We retained the
employer’s appeal.
For the reasons explained below, we conclude the DHRC correctly
determined that the defendant “regularly employed” the requisite four or
more individuals during its landscaping season. The DHRC properly
used a payroll approach and rejected the employer’s proposed twenty-
week test. Because substantial evidence supports the DHRC’s findings,
we affirm the district court judgment upholding the damages awarded to
the former employee.
I. Background Facts and Proceedings.
The agency record establishes the following facts. Simon Seeding
& Sod, Inc. (Simon Seeding) operates a seasonal landscaping business
based in Dubuque, Iowa. Jermaine Stapleton, now age thirty-three,
worked for Simon Seeding in 2006 and again in 2012. Stapleton, an
African-American, claims that Simon Seeding’s owner, Leo Simon,
discriminated against him based on his race.
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A. Events Leading to the Complaint. Stapleton grew up in
Burnsville, Minnesota, and moved to Dubuque to attend Clarke College.
He began working for Simon Seeding in April 2006. Stapleton recalled
that Leo regularly referred to him using racial epithets while working,
such as “chocolate guy” and “colored lad.” Stapleton did not respond “in
kind,” but in his words,
[A] few times I asked him, you know, not to do it but, you
know, it was so continuous that it almost became, you know,
an everyday thing so I just kind of took it all in stride
because I needed the job so—
Stapleton ceased working at Simon Seeding in September of 2006. He
returned to work there six years later.
Meanwhile, in 2008, Stapleton was convicted of possession of a
controlled substance and sentenced to probation. In 2009, he was
arrested for operating a motor vehicle while intoxicated, and the district
court ordered him to the First Judicial District Dubuque
Residential/Work Release Facility (work-release facility). Stapleton
tested positive for narcotics and was sent to prison. In 2012, he was
transferred from prison into the work-release facility, where residents
were required to maintain employment. Stapleton approached Frank
Berwanger, another resident, about returning to work at Simon Seeding.
Berwanger worked for Leo there. Stapleton told Berwanger to tell Leo
that he was the “colored guy” who worked for Leo in 2006. Leo did not
remember Stapleton, but nonetheless hired him back at $8 per hour for
twenty hours per week.
Stapleton resumed working for Simon Seeding on March 15. Leo
resumed calling him “chocolate guy,” “chocolate lad,” and “colored lad.”
Stapleton estimated Leo made such comments to him two or three times
weekly. “Ninety percent of the time” Stapleton would ask Leo not to call
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him those words. Leo responded, “Oh Jay, don’t worry, it’s not that big
of a deal, I’m just joking.” Stapleton obtained another full-time job at
Roofco in April, but continued to work for Simon Seeding part-time
because he did not want to be disciplined at the work-release facility for
quitting.
On May 6, Leo picked Stapleton up from the work-release facility to
drive with him to a job site in Wisconsin. Leo stated that Stapleton did
not seem “right,” and Leo believed he may be “on” something. He asked
Stapleton if he really wanted to work that day, and Stapleton said he did.
When they arrived at the job site, it was raining and muddy. Leo could
not find a chain he needed to pull machinery out of the mud. He said to
Stapleton, “Stupid colored mother fucker, find my chain now!” Stapleton
responded, “Man, can you please stop calling me that.” Leo retorted,
“Well, if you don’t like it, you can walk home.” Stapleton began walking
back to the work-release facility, fifty to sixty miles away. A half hour
later, a police officer stopped Stapleton to ask why he was walking along
the highway. Stapleton explained the situation, and the police officer
drove Stapleton back to the job site. The officer told Leo that Leo was
responsible for getting Stapleton back to the work-release facility.
Meanwhile, Leo had called the work-release facility and spoken
with residential officer Gael Huinker, who made the following notes:
At 1015 hours this date, this RO received a phone call from
Leo Simon. Mr. Simon stated that when he picked
Mr. Stapleton up for work this date he didn’t feel like
Mr. Stapleton really felt like working. . . . Mr. Simon then
stated when they got to Dodgeville it was raining so they sat
in the truck a while and when it stopped Mr. Stapleton took
some pictures and then didn’t want to do anything else. . . .
Mr. Simon then asked this RO if we could pick Mr. Stapleton
up or if he could walk back. This RO began to ask a lot of
questions, asking some of them 2-3 times b/c the whole
situation was a bit confusing and Mr. Simon was giving real
short answers. Mr. Simon was informed by this RO that
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Mr. Stapleton was not allowed to walk back to the facility
and asked if he could [stay] on site until the end of the day.
This RO also asked Mr. Simon to inform Mr. Stapleton that
he is not allowed to walk back and to please call us if
anything is resolved.
At 10:26 a.m., Leo called back and said Stapleton was “walking over the
hill.” At 11 a.m., he called again to say a police officer had brought
Stapleton back to the job site. At 11:27 a.m., he called a fourth time to
report that Stapleton was “taking pictures again” and that “everything
had worked out.” At 1 p.m., Leo dropped Stapleton off at the work-
release facility, and Huinker observed the pair seemed to be getting along
and were laughing together. Stapleton informed her it “started over a
chain” and that Leo called him a racial slur.
The next day, Stapleton called Leo to pick him up for work. Leo
told Stapleton that he did not need him anymore. Stapleton never
worked for Simon Seeding again.
Huinker received a complaint from another resident on May 6
about Leo’s discriminatory behavior. Stephen Toliver had worked for
Simon Seeding for one day when he told Huinker that Leo had called him
a “nigger” several times. Toliver told Huinker he “realize[d] Mr. Simon
[was] probably just used to saying things like that because he has been
doing it for so long.” He asked Leo to call him Steve. Leo requested that
Toliver not be placed for work with him any longer because he did not
think Toliver “was a very hard worker.”
Huinker discussed the complaints with Wendy Lyons, the work-
release facility’s residential manager. Neither Stapleton nor Toliver was
disciplined for losing their jobs because they had alleged discrimination.
On May 29, Lyons decided the facility would no longer place residents
with Simon Seeding. Leo phoned Lyons to protest her decision and
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called back twice to say he was not racist and did not appreciate being
called racist.
B. The Complaint and Investigation. Stapleton filed his
complaint with the DHRC on May 16, 2012. He alleged discrimination in
violation of Dubuque City Ordinance 8-3-3, the city’s counterpart to the
ICRA. The DHRC sent the first of eight letters to Leo on May 25,
requesting a formal response to the complaint and certain employment
documentation. Leo failed to respond. Seven more letters went
unanswered as the investigation continued over the next fourteen
months. On November 15, 2013, the DHRC requested a subpoena for
the employment documentation, including W-2s, copies of payroll
records, and a list of employees. In December, the subpoena was served
on Simon Seeding. By February 2014, no information had been received.
The DHRC contacted Leo, who named his accountant. The accountant
responded to the investigator’s direct inquiry by providing the DHRC with
Simon Seeding’s payroll journal and tax information.
The payroll listed the only employees in 2012 as Leo, John
Berwanger, Frank Berwanger, and Jesse Weiland, without including
Stapleton. The DHRC found a note dated April 3, 2012, at the work-
release facility that stated Stapleton had been paid “for 40.5 hours of the
week this date.” The DHRC found there was probable cause to
investigate.
In February 2015, a public hearing was held before an
administrative law judge and two commissioners (the panel). Stapleton,
his mother, his ex-girlfriend, and Wendy Lyons testified on his behalf.
Leo, Frank Berwanger, Greg James, Jody James, and Erica Wiles (other
employees) testified for Simon Seeding.
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Stapleton testified he overheard Leo refer to him as “colored” or
“chocolate” to Berwanger and others at the worksite. He testified about
the impact Leo’s statements had on him. He had been “happy-go-lucky,”
“open-minded,” and “funny.” But Leo’s racial slurs changed his attitude:
Q. And did anything change after the series of
remarks that you described to us earlier in your testimony?
A. I’d say a lot changed. I, you know, went from super high
character to, you know, self-pity to just, you know, yelling at
my girl, yelling at my mom, getting real irritable. There’d be
nights in the halfway house where I’d just stay up all night,
you know, just—I was struggling especially bad.
Stapleton sought counseling to deal with his emotional difficulties. He
attended one session but did not continue because he lacked insurance
and could not afford it. Stapleton described Leo’s effect on him as a
“scar that never goes away.”
Stapleton’s mother testified she noticed a change in him. They
spoke daily by phone, and he kept her informed as to what Leo called
him. She noticed that her son became depressed and agitated. She
testified that Stapleton now lives with her in Minnesota, and he still talks
about what Leo said and did. The incidents “bring[] back the feeling of
destitution, of there’s nothing I can do about it. Nobody cares about it.”
Stapleton’s ex-girlfriend testified similarly, stating Stapleton would “lash
out” and was not getting any sleep because of the way he was treated.
On cross-examination, defense counsel raised Stapleton’s history of drug
abuse and residency in the halfway house. Defense counsel suggested
those stressors caused Stapleton’s depression and anxiety.
Berwanger and Leo denied the incidents described by Stapleton.
Berwanger testified he worked with Stapleton about “ninety percent” of
the time, and he never heard Leo make any disparaging racial remarks.
Berwanger did not believe there was “any truth to Mr. Stapleton’s
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allegations.” Greg James testified he is African-American and has a
biracial family, and Leo has never given any indication of racist feelings.
His wife, Jody James, testified similarly.
Leo described the record keeping at Simon Seeding. He admitted
there were some employees that were not on the payroll records,
including Jody James and Stapleton:
Q. Okay. Are there some employees that would not
have been accounted for by [the accountant]? A. Right, and
some of them, if they—you know, some only helped a half a
day or a day or something or somebody would bring their
buddy along; you know what I mean?
Q. And you wouldn’t pay them through a payroll
check, you’d just pay them on the spot? A. Yeah, because
that’s what some of them wanted, same-day pay; you know
what I mean?
....
Q. Did you hear [Jody James] testify that she did
work for you between March 15th and May 6th of 2012?
A. Right, and as you said, she wasn’t always on the payroll.
They had got gas for some wages and stuff like that was
advantage to them. They weren’t all on the payroll.
Q. And I don’t see Jermaine Stapleton on this
April 1st to June 30th period of time either. Didn’t he work
for you? A. Right. He only worked a hundred and thirty-
eight hours. He was not full time.
Q. So you paid a number of other people who aren’t
listed here for their services during that period of time; isn’t
that correct? A. Not a ton of people, a few but not a ton.
On March 30, the panel issued a proposed decision, finding Simon
Seeding had engaged in prohibited racially discriminatory conduct. In
determining whether Simon Seeding “regularly employed” four
individuals to bring it within the ordinance, the panel defined that term
to mean “at regular intervals.” From the employer’s tax and payroll
documents, the panel determined,
For the weeks of March 18, 2012, March 25, 2012, April 1,
2012, April 8, 2012, April 29, 2012, May 20, 2012, and
May 27, 2012, September 23, 2012, and September 30,
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2012, Simon Seeding employed five employees. During the
weeks of April 15, 2012 and April 22, 2012, Simon Seeding
employed six employees. For the weeks of May 6, 2012,
May 13, 2012, June 3, 2012, June 10, 2012, June 17, 2012,
June 24, 2012, July 1, 2012, September 16, 2012, Simon
Seeding employed four employees. Simon Seeding’s records
show Simon Seeding employed four or more employees for
19 weeks in 2012.
The panel also questioned “the accuracy of Simon Seeding’s payroll and
tax records.” The panel identified several individuals Simon Seeding
admittedly employed but omitted from its payroll records. The panel
found “Simon Seeding regularly employed four or more employees in
2012.”
The panel determined Leo had subjected Stapleton to a hostile
work environment. It found, “Stapleton’s testimony is reasonable and
consistent with the other evidence the panel believes; Leo Simon’s
testimony is not.” The panel also noted, “Stapleton made
contemporaneous reports of Leo Simon’s racial slurs to the work release
facility, to his mother, and to his girlfriend.” Leo initially denied using
racial slurs, but later admitted he may have made them in a joking
manner. The panel awarded $2817 in lost wages, $15,000 in emotional
distress damages, and $29,400 in attorney fees. Both parties appealed.
The DHRC affirmed the proposed decision by a vote of 6–1. The
DHRC increased Stapleton’s lost wages to $4500 by correcting the
panel’s math error. The DHRC tripled the emotional distress award to
$45,000, without explanation. The DHRC found the attorney fees
claimed by Stapleton were not excessive, affirmed the $29,400 fee award,
and awarded an additional $1600 for the administrative appeal.
Simon Seeding filed a petition for judicial review in district court.
It argued it did not employ the requisite number of employees to be
subject to the Dubuque ordinance and denied Stapleton’s allegations of
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racial discrimination. It also contended the evidence was insufficient to
award lost wages and emotional distress. The district court affirmed the
DHRC’s decision and awarded an additional $4500 in attorney fees for
the judicial review.
Simon Seeding appealed, and we retained the case.
II. Standard of Review.
“[F]inal decisions of municipal civil rights commissions [are]
reviewable to the same extent as final decisions of the Iowa Civil Rights
Commission (ICRC).” Palmer Coll. of Chiropractic v. Davenport Civil Rights
Comm’n, 850 N.W.2d 326, 332 (Iowa 2014). Iowa Code section
17A.19(10) controls judicial review of an ICRC decision. Renda v. Iowa
Civil Rights Comm’n, 784 N.W.2d 8, 10 (Iowa 2010). The burden of
demonstrating invalidity of the agency action rests on the party asserting
the invalidity. Iowa Code § 17A.19(8)(a) (2015).
“[O]ur standard of review depends on the aspect of the agency’s
decision that forms the basis of the petition for judicial review.” Burton v.
Hilltop Care Ctr., 813 N.W.2d 250, 256 (Iowa 2012). “[A] reviewing court
can only disturb . . . factual findings if they are ‘not supported by
substantial evidence in the record before the court when that record is
reviewed as a whole.’ ” Id. (quoting Iowa Code § 17A.19(10)(f)).
“When that record is viewed as a whole” means that
the adequacy of the evidence in the record before the court to
support a particular finding of fact must be judged in light of
all the relevant evidence in the record cited by any party that
detracts from that finding as well as all of the relevant
evidence in the record cited by any party that supports it,
including any determinations of veracity by the presiding
officer who personally observed the demeanor of the
witnesses and the agency’s explanation of why the relevant
evidence in the record supports its material findings of fact.
Iowa Code § 17A.19(10)(f)(3) (second emphasis added).
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When reviewing an agency’s interpretation of law, “[t]he level of
deference afforded . . . depends on whether the authority to interpret that
law has ‘clearly been vested by a provision of law in the discretion of the
agency.’ ” Burton, 813 N.W.2d at 256 (quoting Iowa Code
§ 17A.19(10)(c)). If the legislature did not clearly vest the agency with
interpretive authority, we review for correction of errors at law. Iowa
Code § 17A.19(10)(c). An agency has been “clearly vested” with
interpretive authority only when we have a “firm conviction” that “the
legislature actually intended . . . to delegate to the agency interpretive
power with the binding force of law.” Renda, 784 N.W.2d at 11 (quoting
Arthur E. Bonfield, Amendments to Iowa Administrative Procedure Act,
Report on Selected Provisions to Iowa State Bar Association and Iowa
State Government 63 (1998) [hereinafter Bonfield]).
Normally, the interpretation of a statute is a pure question of
law over which agencies are not delegated any special powers
by the General Assembly so, a court is free to, and usually
does, substitute its judgment de novo for that of the agency
....
Id. (quoting Bonfield at 62).
The DHRC argues we should defer to its interpretation of the
phrase “regularly employs.” We disagree. No Dubuque ordinance or
Iowa statute expressly vests the DHRC with interpretive authority. See
Renda, 784 N.W.2d at 14. The phrase “regularly employ[s]” is not a
specialized term of art requiring the agency’s unique expertise to apply.
Id. The phrase is used in other Iowa statutes. 1 See id. (“When the
provisions to be interpreted are found in a statute other than the statute
1Iowa Code § 216.6A(4) (stating wage discrimination shall not apply to “any
employer who regularly employs less than four individuals”); id. § 809A.1 (stating
“seizing agency” under Forfeiture Reform Act means agency that “regularly employs law
enforcement officers”).
12
the agency has been tasked with enforcing, we have generally concluded
interpretive power was not vested in the agency.”). “Accordingly, we do
not give deference to the agency’s interpretation and will substitute our
judgment . . . if we conclude the [DHRC] made an error of law.” Id. at
14–15.
We review the excessiveness of an award of damages for abuse of
discretion. Lynch v. City of Des Moines (Lynch I), 454 N.W.2d 827, 836
(Iowa 1990). Our review of the amount of attorney fees awarded in a civil
rights action is for abuse of discretion. Lynch v. City of Des Moines
(Lynch II), 464 N.W.2d 236, 238 (Iowa 1990). We will not find an abuse
of discretion unless it is shown “that such discretion was exercised on
grounds . . . clearly untenable or, to an extent clearly unreasonable.” Id.
(alteration in original) (quoting State v. Morrison, 323 N.W.2d 254, 256
(Iowa 1982)).
III. Analysis.
We must decide whether Simon Seeding falls within the small-
employer exemption of the Dubuque ordinance, which turns on whether
it “regularly employs” four or more persons. We have not previously
interpreted that phrase found in the ICRA and other Iowa statutes. We
conclude the numerosity requirement has been met in this case and
reject Simon Seeding’s other challenges to the award.
A. Whether Simon Seeding Regularly Employed Four or More
Individuals. We begin our analysis with an overview of the legal
framework. “Iowa Code section 216.19 authorizes a city to adopt its own
civil rights ordinance.” Botsko v. Davenport Civil Rights Comm’n, 774
N.W.2d 841, 845 (Iowa 2009); see also Iowa Code § 216.19(1)(c) (stating
ICRA not intended to “limit[] a city or local government from enacting any
ordinance or other law which prohibits broader or different categories of
13
unfair or discriminatory practices”). Dubuque Ordinance section 8-3-3,
patterned after the ICRA, provides,
A. Prohibited Practices: It shall be an unfair or
discriminatory practice for any:
1. Person to refuse to hire, accept, register, classify, or
refer for employment, to discharge any employee, or to
otherwise discriminate in employment against any applicant
for employment or any employee because of the race, creed,
color, sex, age, national origin, religion, sexual orientation,
or gender identity of such applicant or employee, unless
based upon the nature of the occupation.
Dubuque, Iowa, Code of Ordinances § 8-3-3(A)(1) (2016); see also Iowa
Code § 216.6(1)(a). Both the ICRA and the Dubuque ordinance include
this small-employer exemption:
2. This section shall not apply to:
a. Any employer who regularly employs less than four
(4) individuals. For purposes of this subsection, the owners,
owners’ spouses, and children shall not be counted as
employees.
Id. § 8-3-3(B)(2)(a) (emphasis added); see also Iowa Code § 216.6(6)(a)
(same).
“Local civil rights ordinances must be consistent with the civil
rights statute.” Consol. Freightways, Inc. v. Cedar Rapids Civil Rights
Comm’n, 366 N.W.2d 522, 526 (Iowa 1985). “It follows that when
ordinances contain provisions identical to those in the statute the
provisions have the same meaning.” Id. Section 216.19 of the ICRA
permits local ordinances to prohibit “broader or different categories of
unfair or discriminatory practices,” but it does not authorize ordinances
to expand coverage to employers not otherwise included. Baker v. City of
Iowa City, 750 N.W.2d 93, 100–01 (Iowa 2008) (emphasis added) (quoting
Iowa Code § 216.19). The phrase “regularly employs” under Dubuque’s
14
ordinance therefore must have the same meaning under the ICRA’s
exemption in section 216.6(6)(a).
1. Is the numerosity requirement jurisdictional? Simon Seeding
argues the numerosity requirement is a matter of subject-matter
jurisdiction. The DHRC disagrees. We reiterate “the importance of
resolving jurisdictional issues first, especially those involving subject
matter jurisdiction.” State v. Lasley, 705 N.W.2d 481, 485 (Iowa 2005).
“[Lack] of subject matter jurisdiction can be raised at any time.”
State v. Mandicino, 509 N.W.2d 481, 482 (Iowa 1993). “Subject matter
jurisdiction refers to ‘the authority of a court to hear and determine
cases of the general class to which the proceedings in question belong,
not merely the particular case then occupying the court’s attention.’ ”
Alliant Energy-Interstate Power & Light Co. v. Duckett, 732 N.W.2d 869,
874–75 (Iowa 2007) (quoting Christie v. Rolscreen Co., 448 N.W.2d 447,
450 (Iowa 1989)). “If a court enters a judgment without jurisdiction over
the subject matter, the judgment is void and subject to collateral attack.”
Klinge v. Bentien, 725 N.W.2d 13, 16 (Iowa 2006).
In Arbaugh v. Y&H Corp., the United States Supreme Court held
Title VII’s fifteen-employee numerosity requirement is not jurisdictional,
but rather is a merits-based substantive proof requirement. 546 U.S.
500, 515, 126 S. Ct. 1235, 1245 (2006). First, the Court emphasized
subject-matter jurisdiction “can never be forfeited or waived,” and it had
the obligation to raise the inquiry on its own motion. Id. at 501, 126
S. Ct. at 1237 (quoting United States v. Cotton, 535 U.S. 625, 630, 122
S. Ct. 1781, 1785 (2002)). But “[n]othing in the text of Title VII
indicate[d] that Congress intended courts, on their own motion, to assure
that the employee-numerosity requirement is met.” Id. at 514, 126 S. Ct.
at 1244. Second, when subject-matter jurisdiction “turns on contested
15
facts,” the judge may resolve the dispute. Id. However, the “jury [was]
the proper trier” of the numerosity requirement, which involved an
“essential element of a claim for relief.” Id. Finally, the Court noted the
unfairness and “waste of judicial resources” that would entail if the
numerosity requirement were jurisdictional because a party could raise
the issue after trial and vacate the judgment. Id. at 515, 126 S. Ct. at
1245. The Court concluded, “[W]hen Congress does not rank a statutory
limitation on coverage as jurisdictional, courts should treat the
restriction as nonjurisdictional in character.” Id. at 516, 126 S. Ct. at
1245. We find the Arbaugh analysis persuasive and hold the numerosity
requirement in the ICRA and Dubuque ordinance is not jurisdictional.
Simon Seeding argues Arbaugh is inapposite because the ICRA is
structured differently than the Federal Act. Title VII includes the fifteen-
employee threshold in the statutory definition for the word “employer.”
Civil Rights Act of 1964, Pub. L. No. 88–352, § 701(b), 78 Stat. 241, 253
(codified as amended at 42 U.S.C. § 2000e(b) (2012)). 2 The ICRA,
however, defines “employer” to include “the state of Iowa . . . and every
other person employing employees within the state.” Iowa Code
§ 216.2(7). The numerosity requirement is placed in the substantive
portion of the Act. See id. § 216.6 (entitled “Unfair employment
practices”). That placement reinforces our conclusion it is a merits-
based element of proof required for liability, rather than a jurisdictional
prerequisite. Whether an employer “regularly employs” four or more
employees, as this case shows, is a fact-intensive inquiry best
determined by the trier of fact.
2The1964 Act required twenty-five employees for twenty weeks in any current or
preceding calendar year. A 1972 amendment changed the requirement to fifteen
employees. 1972 Amendments, Pub. L. No. 92–261, § 2(2), 86 Stat. 103, 103 (1972).
16
Our analytical approach to subject-matter jurisdiction mirrors the
Arbaugh analysis:
[J]urisdiction of the subject matter is conferred by operation
of law, and not by act of the parties or by procedure of the
court. It cannot be ousted by act of the parties, if it exists,
nor conferred by such acts, if it does not exist. Its existence
antedates the particular litigation, and is not conferred by
the litigation or by its procedure.
Pottawattamie Cty. Dep’t of Soc. Servs. v. Landau, 210 N.W.2d 837, 843
(Iowa 1973) (alteration in original) (quoting Appeal of McLain, 189 Iowa
264, 269, 176 N.W. 817, 819 (1920)). The ICRA “provides a cause of
action for discriminatory practices” and “gives the district court subject
matter jurisdiction of such actions.” Christie, 448 N.W.2d at 450.
Subject-matter jurisdiction “cannot be conferred by consent, waiver, or
estoppel.” Duckett, 732 N.W.2d 874 (quoting Keokuk County v. H.B., 593
N.W.2d 118, 122 (Iowa 1999)). If numerosity were jurisdictional, a party
could raise it after trial to vacate a judgment, resulting in a waste of
resources. See In re Estate of Falck, 672 N.W.2d 785, 789 (Iowa 2003)
(noting lack of subject-matter jurisdiction makes the judgment void).
The better interpretation is that the numerosity requirement of section
216.6(6)(a) is part of the plaintiff’s substantive burden of proof. If the
defendant does not contest numerosity, “the judgment becomes final and
is not subject to collateral attack.” Id. at 790.
2. Did the agency correctly interpret the term “regularly employs”?
Simon Seeding urges us to follow Cochran v. Seniors Only Financial, Inc.,
which interpreted the ICRA’s numerosity requirement. 209 F. Supp. 2d
963, 967 (S.D. Iowa 2002). Janet Cochran alleged a hostile work
environment and sex discrimination in violation of the ICRA. Id. at 964.
The defendant filed a motion for partial summary judgment on the
ground it employed less than four individuals. Id. The Cochran court
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noted, “Iowa Code section 216.6(6)(a) has not been heavily inspected by
the courts.” Id. at 967. The court observed that although federal law “is
not controlling of ICRA claims,” it can provide “the analytical framework.”
Id. at 966 (quoting Vivian v. Madison, 601 N.W.2d 872, 873 (Iowa 1999)).
Title VII’s numerosity requirement defines the term “employer” to include
only those having “fifteen or more employees for each working day in
each of twenty or more calendar weeks in the current or preceding year.”
42 U.S.C. § 2000e(b).
The Cochran court concluded it was appropriate to rely on federal
authorities for guidance to interpret section 216.6(6):
In Vivian, the Iowa Supreme Court found some stark
differences in the language the Iowa legislators [chose] to
use, and found that federal law was not persuasive and a
supervisor could be held personally liable under the ICRA.
In this case, the Court does not find these same differences
in the relevant statutory language when comparing the ICRA
to Title VII. While the ICRA states that for an employee to
count he or she must be “regularly” employed, Title VII goes
a step farther and says that an employee must be employed
“for each working day in each of 20 or more calendar weeks
in the current or preceding calendar year” in order for the
employee to count towards the numerosity requirement. The
Court finds that Title VII does provide appropriate guidance
for determining whether an employee is “regularly” employed
under the ICRA and adopts this definition.
209 F. Supp. 2d at 967 (quoting 42 U.S.C. § 2000e(b)). The court
concluded each employee “must have been employed for twenty weeks in
order to have been ‘regularly employed’ ” under the ICRA. Id. Under that
definition, the employer “regularly employed only two employees during
the relevant time frame.” Id. Therefore, the court granted summary
judgment for the employer. Id.
Simon Seeding argues we should follow Cochran to count only
individuals it had employed for at least twenty weeks. The Cochran
court, however, used a twenty-week requirement nowhere codified in the
18
ICRA. Moreover, Cochran is contrary to the great weight of federal
authority as well as state court numerosity decisions. We decline to
follow it. 3
The DHRC relies on Walters v. Metropolitan Educational
Enterprises, Inc., a United States Supreme Court case clarifying how to
count employees under Title VII. 519 U.S. 202, 207, 117 S. Ct. 660, 664
(1997). Darlene Walters filed a complaint with the Equal Employment
Opportunity Commission (EEOC), “claiming that Metropolitan had
discriminated against her on account of her sex in failing to promote
her.” Id. at 204, 117 S. Ct. at 662. Metropolitan filed a motion to
dismiss on grounds that it “did not pass the 15-employee threshold for
coverage under Title VII.” Id. The district court granted the motion,
reasoning that employees only counted toward the fifteen-person
requirement on days “which they actually performed work or were being
compensated.” Id. at 205, 117 S. Ct. at 663. The court of appeals
affirmed, and the Supreme Court granted certiorari to explain how and
when persons are counted as employees. Id.
The Walters Court stated that “an employer ‘has’ an employee if he
maintains an employment relationship with that individual.” Id. at 207,
117 S. Ct. at 664. To determine whether an employment relationship
3Nofederal appellate court has adopted the Cochran approach urged by Simon
Seeding—that an employee must work for twenty weeks before counting toward the
threshold employee requirement. See Cochran, 209 F. Supp. 2d at 967. A federal
district court, interpreting a similar numerosity requirement under the Age
Discrimination in Employment Act, observed,
All that the statute requires is that the employer have 20 or more
employees for each day of 20 or more calendar weeks. It does not require
that a particular individual be employed for 20 weeks prior to being
counted as an employee.
Rogers v. Sugar Tree Prods., Inc., 824 F. Supp. 755, 761 (N.D. Ill. 1992), aff’d 7 F.3d
577 (7th Cir. 1993).
19
exists, courts should look “first and primarily to whether the individual
in question appears on the employer’s payroll.” Id. at 211, 117 S. Ct. at
666.
[A]ll one needs to know about a given employee for a given
year is whether the employee started or ended employment
during that year and, if so, when. He is counted as an
employee for each working day after arrival and before
departure.
Id. at 211, 117 S. Ct. at 665–66. “Metropolitan had between 15 and 17
employees on its payroll” for thirty-eight weeks out of the year. Id. at
205, 212, 117 S. Ct. at 663, 666. Therefore, Metropolitan met the
fifteen-employee threshold and was subject to the provisions of Title VII.
Id. at 212, 117 S. Ct. at 666.
Walters resolved a circuit split among federal circuits over how to
count employees to meet Title VII’s numerosity requirement. 519 U.S. at
205–07, 117 S. Ct. at 662–64. The United States Court of Appeals for
the Seventh and Eighth Circuits had counted employees for a particular
working day only when the employer was “actually compensating the
individual on that day.” Id. at 206, 117 S. Ct. at 663; see also E.E.O.C. v.
Garden & Assocs., Ltd., 956 F.2d 842, 843 (8th Cir. 1992), abrogated by
Walters, 519 U.S. at 206, 212, 117 S. Ct. at 663, 666; Zimmerman v. N.
Am. Signal Co., 704 F.2d 347, 354 (7th Cir. 1983), abrogated by Walters,
519 U.S. at 206, 212, 117 S. Ct. at 663, 666. This interpretation
excluded many part-time workers who did not work each day and thus
were not considered “employees” for that week and excluded employees
who left or began work mid-week. Garden & Assocs., 956 F.2d at 843
(part-time employees); E.E.O.C. v. Metro. Educ. Enters., Inc., 60 F.3d
1225, 1228 (7th Cir. 1995) (counting employees who exit or enter mid-
20
week is a “highly unlikely reading of the statute”), rev’d sub nom. Walters,
519 U.S. at 212, 117 S. Ct. at 666.
On the other side of the circuit split, in Thurber v. Jack Reilly’s,
Inc., the First Circuit adopted a broader payroll approach based on Title
VII’s legislative history. 717 F.2d 633, 634 (1st Cir. 1983).
“Congressional debate on enactment of Title VII revealed concern for the
over-regulation of small family or neighborhood businesses.” Id. “The
number 15 was a compromise figure,” but there was “nothing in the
record to indicate a Congressional intent to require that employees report
to work on each day that they are included.” Id. at 635. The court
recognized that Title VII was a “remedial statute, and the prevailing
majority in Congress intended to give it broad effect.” Id. The court
stated,
It is true that the interpretation given to the statute by
the district court might sweep into the ambit of the statute a
few truly “Mom and Pop” stores, which employ a large
number of part-time employees in order to keep open long
hours. The burden on such businesses, however, is the
relatively modest one of forbearance from discrimination in
employment. In our opinion, the inclusion of such stores
offends less against the policy of the statute than does the
exclusion of businesses such as the appellant.
Id. “ ‘[T]he term “employer” [was] intended to have its common dictionary
meaning,’ and that employers with part-time or seasonal staffs were
intended to be covered by the act ‘when the number of employees
exceeds the minimum figure.’ ” Pedreyra v. Cornell Prescription
Pharmacies, Inc., 465 F. Supp. 936, 941 (D. Colo. 1979) (quoting 110
Cong. Rec. 7216–7217 (daily ed. Apr. 8, 1964)); see also David A. Forkner
& Kent M. Kostka, Unanimously Weaving a Tangled Web: Walters,
Robinson, Title VII, and the Need for Holistic Statutory Interpretation, 36
Harv. J. on Legis. 161, 170 (1999) (detailing comments of Senator
21
Dirksen, the author of the amendment that coined the “employer”
definition, stating purpose of twenty-week requirement was to reach
seasonal workers).
The Cochran approach we reject would allow savvy employers to
structure their workforce to avoid compliance obligations. An employer
could “keep[] its staffing levels above the threshold on most working
days, and allow[] it to fall under the level on just one work day.” Wright
v. Kosciusko Med. Clinic, Inc., 791 F. Supp. 1327, 1332 (N.D. Ind. 1992).
The Thurber approach counted an employee toward the threshold on
each day an employment relationship existed, as evidenced by payroll
records, regardless of whether the employee reported to work. 717 F.2d
at 634. The Walters Court found this more expansive payroll method
persuasive and adopted it as the federal standard. 519 U.S. at 210–11,
117 S. Ct. at 665–66. We agree with the DHRC that the Walters payroll
approach should be used to count employees for the ICRA and Dubuque
small-employer exemption, without regard to the number of weeks
individual employees worked.
In the absence of a legislative definition, we strive to give words
their ordinary meaning. City of Riverdale v. Diercks, 806 N.W.2d 643,
655–56 (Iowa 2011). “The primary purpose of statutory construction is
to determine legislative intent,” gleaned from the words used by the
legislature. State v. McCoy, 618 N.W.2d 324, 325 (Iowa 2000). “[W]e
read statutes as a whole rather than looking at words and phrases in
isolation”; context is important. Iowa Ins. Inst. v. Core Grp. of Iowa Ass’n
for Justice, 867 N.W.2d 58, 72 (Iowa 2015). “We ‘look to the object to be
accomplished and the evils and mischiefs sought to be remedied in
reaching a reasonable or liberal construction which will best effect its
purpose rather than one which will defeat it.’ ” Renda, 784 N.W.2d at 15
 22
(quoting Sommers v. Iowa Civil Rights Comm’n, 337 N.W.2d 470, 473
(Iowa 1983)).
In Baker, we discussed the purpose of the small-employer
exemption. 750 N.W.2d at 101. John Baker owned a home in Iowa City
and employed a resident manager to run the property while he lived out
of state. Id. at 95. Baker allegedly discriminated against a female
applicant for the position. Id. An Iowa City civil rights ordinance applied
by its terms to employers with “one or more” employees. Id. at 100
(quoting Iowa City, Iowa, City Code § 2–3–1 (2003)). We held the city
ordinance could not expand the coverage of the Iowa Civil Rights Act and
thereby nullify the ICRA’s small-business exemption. Id. at 101–02.
We recognized that the small-employer exemption was enacted as a
result of “changes advocated in a 1964 law review article” by Professor
Arthur Bonfield. Id. at 101. Bonfield “urged enactment of an
employment discrimination statute that included a small-employer
exemption.” Id. (citing Arthur E. Bonfield, State Civil Rights Statutes:
Some Proposals, 49 Iowa L. Rev. 1067, 1108 (1964) [hereinafter State
Civil Rights Statutes]).
Almost all fair employment practices acts exempt small
employers, which are defined as employers with less than a
specified number of employees. The general consensus
seems to be that notions of freedom of association should
preponderate over concepts of equal opportunity in these
situations because the smallness of the employer’s staff is
usually likely to mean for him a rather close, intimate,
personal, and constant association with his employees.
Id. (quoting State Civil Rights Statutes, 49 Iowa L. Rev. at 1109)).
Accordingly, in Baker, we interpreted the ICRA to “protect small
employers’ associational interests.” Id. We concluded “the legislature
made the policy decision that ‘freedom of association should
preponderate over concepts of equal opportunity’ in situations involving
23
small employers.” Id. (quoting State Civil Rights Statutes, 49 Iowa L. Rev.
at 1109).
We also apply the legislative directive to “construe[ the ICRA]
broadly to effectuate its purposes.” Iowa Code § 216.18(1); accord
Dubuque, Iowa, Code of Ordinances § 8-4-10 (codifying same rule of
construction). The ICRA was enacted “to eliminate unfair and
discriminatory practices in . . . employment” and “correct a broad pattern
of behavior rather than merely affording a procedure to settle a specific
dispute.” Renda, 784 N.W.2d at 19 (alteration in original) (first quoting
1965 Iowa Acts ch. 121 (title of act), then quoting Estabrook v. Iowa Civil
Rights Comm’n, 283 N.W.2d 306, 308 (Iowa 1979)). We strive to
effectuate these purposes as we define the phrase “regularly employs less
than four individuals.”
The dictionary defines “regularly” as “in a regular, orderly, lawful
or methodical way.” Regularly, Webster’s Third New International
Dictionary (unabr. ed. 2002). “Regular,” is defined as “returning,
recurring, or received at stated, fixed, or uniform intervals.” Regular,
Webster’s Third New International Dictionary. We construed “employ” in
the Iowa wage payment collection law to mean,
To engage in one’s service; to hire, to use as an agent
or substitute in transacting business; to commission and
intrust with the performance of certain acts or functions or
with the management of one’s affairs; . . . the term is
equivalent to hiring, which implies a request and a contract
for compensation. To make use of, to keep at work, to
entrust with some duty.
Runyon v. Kubota Tractor Corp., 653 N.W.2d 582, 585 (Iowa 2002)
(alteration in original) (emphasis added) (quoting Employ, Black’s Law
Dictionary (abr. 6th ed. 1991)); see also Employ, Webster’s Third New
International Dictionary (defining “employ” as “to provide with a job that
24
pays wages or a salary or with a means of earning a living”). Thus, the
word “employ” focuses on the existence of a contract for services, and the
word “regular” focuses on recurring acts.
We must interpret words in context. The phrase “regularly
employs” modifies “employer,” not employee. Iowa Code § 216.6(6)(a)
(“Any employer who regularly employs” (emphasis added)). The
exemption could have been drafted to say, “Any employee who is
regularly employed.” For example, Connecticut’s workers’ compensation
statute defines an employee as excluding a person engaged in service in
a private dwelling “provided he is not regularly employed by the owner or
occupier over twenty-six hours per week.” Conn. Gen. Stat. Ann. § 31-
275(9)(A)(vi) (West, Westlaw current through General Statutes of Conn.,
Revision of 1958, Revised to Jan. 1, 2017). This was interpreted to mean
the “person must work more than twenty-six hours per week during the
majority of the fifty-two weeks preceding the date of his or her injury.”
Smith v. Yurkovsky, 830 A.2d 743, 746 (Conn. 2003); see also La. Stat.
Ann. § 47:111(A)(3)(a) (Westlaw current through 2017 1st Extraordinary
Sess.) (defining “regularly employed” as a person who performs services
over a set period of twenty-four days per calendar quarter). Simon
Seeding’s interpretation would make more sense under those statutes.
By contrast, the Iowa legislature chose to define the small-
employer exemption by focusing on the actions of the employer rather
than the individual employee. We are bound by the language our
legislature selected. Iowa Code section 216.6(6)(a) exempts employers
who regularly employ less than four individuals.
Our interpretation is supported by the numerosity decisions of
other state appellate courts construing equivalent small-employer
exemptions. For example, the California Fair Employment and Housing
25
Act defines an “employer” as “any person regularly employing five or
more persons.” Cal. Gov’t Code § 12926(d) (West, Westlaw current
through ch. 8 of 2017 Reg. Sess.). In Robinson v. Fair Employment &
Housing Commission, the California Supreme Court interpreted the term
“regularly employing” under the Act. 825 P.2d 767, 768 (Cal. 1992). The
Robinson court gave those words their ordinary meaning, stating,
The California act states that an employer falls within
its provisions only when he is regularly employing five or
more persons. This does not mean that the accused
employer must have five or more employees every day
throughout the year or that he must have five or more
employees at the time of the discriminatory act. It does
mean that he must have an “average” or “normal”
complement of five or more persons in his employ on a
“regular” basis.
Id. at 773 (quoting Michael C. Tobriner, California FEPC, 16 Hastings L.J.
333, 343 (1965) [hereinafter Tobriner]). The court determined the
purpose of the Act was to
reliev[e] the administrative body of the burden of
enforcement [of the Act] where few job opportunities are
available, and [to] keep[] the agency out of situations in
which discrimination is too subtle or too personal to make
effective solutions possible.
Id. at 774. As we did in Baker, the California Supreme Court noted the
legislature’s policy choice to favor the associational rights of small
employers:
A sense of justice and propriety led the framers to
believe that individuals should be allowed to retain some
small measure of the so-called freedom to discriminate;
besides, they feared the political repercussions of eliminating
totally an area of free choice whose infringement had been so
bitterly opposed. In the second place, the framers believed
that discrimination on a small scale would prove exceedingly
difficult to detect and police. Third, it was believed that an
employment situation in which there were less than five
employees might involve a close personal relationship
between employer and employees and that fair employment
laws should not apply where such a relationship existed.
26
Finally, the framers were interested primarily in attacking
protracted, large-scale discrimination by important
employers and strong unions. Their aim was not so much to
redress each discrete instance of individual discrimination as
to eliminate the egregious and continued discriminatory
practices of economically powerful organizations. Thus they
could afford to exempt the small employer.
Id. at 775 (quoting Tobriner, 16 Hastings L.J. at 342). The Robinson
court concluded the word “regularly” suggested an understanding of
“occurring at fixed intervals.” Id. Thus, “the number of employees who
work regularly as opposed to intermittently, or who are carried on the
payroll at the time of the discriminatory act, would be dispositive.” Id.
Similarly, North Carolina’s Equal Employment Practices Act
applies to employers that “regularly employ 15 or more employees.” See
N.C. Gen. Stat. Ann. § 143-422.2 (West, Westlaw effective through S.L.
2017-9, 2017 Reg. Sess.). Interpreting this phrase, the North Carolina
Court of Appeals found the federal “payroll method” persuasive:
“The ultimate purpose of . . . [N.C. Gen. Stat. §] 143–
422.2, and Title VII . . . is the same; that is, the elimination
of discriminatory practices in employment.” Accordingly, we
find the language of Title VII, and the principles of law
applied to claims arising under Title VII, to be instructive
here. We conclude that an employer regularly employs 15 or
more employees, and is thus governed by N.C. Gen. Stat.
§ 143–422.2, when 15 or more employees appear on the
employer’s payroll each working day during each of 20 or
more calendar work weeks in the current or preceding
calendar year.
Walker v. Town of Stoneville, 712 S.E.2d 239, 248 (N.C. Ct. App. 2011)
(alterations in original) (quoting N.C. Dep’t of Corr. v. Gibson, 301 S.E.2d
78, 85 (N.C. 1983)).
Under Simon Seeding’s interpretation, an employer could employ
100 individuals for nineteen weeks, terminate their employment, then
hire 100 different individuals for the next nineteen weeks, and so on.
The employer would thereby escape the purview of the Act because at no
27
point would it have employed the same four or more individuals for
twenty consecutive weeks. Given that section 216.6(6)(a) was intended
to exempt only small employers, we refuse to open that loophole in the
ICRA. We instead adopt the Walters approach to hold that an employee
is counted for purposes of the small-business exemption if that employee
has an employment relationship with the employer—that is, if he or she
is on the payroll.
We decline to import a twenty-week requirement into the ICRA.
Title VII expressly codifies a twenty-week requirement. See 42 U.S.C.
§ 2000e(b) (defining “employer” as “a person engaged in an industry
affecting commerce who has fifteen or more employees for each working
day in each of twenty or more calendar weeks in the current or preceding
calendar year”). Title VII was enacted with the twenty-calendar week
requirement in 1964. See Civil Rights Act of 1964, Pub. L. No. 88–190,
§ 701, 78 Stat. 241, 253. The Iowa legislature declined to include a
twenty-week term when it enacted the ICRA a year later. See 1965 Iowa
Acts ch. 121, § 7. We will not add a requirement to a statute that the
legislature chose to omit. See Hawkeye Land Co. v. Iowa Utils. Bd., 847
N.W.2d 199, 210 (Iowa 2014) (“[L]egislative intent is expressed by what
the legislature has said, not what it could or might have said. . . . Intent
may be expressed by the omission, as well as the inclusion, of statutory
terms.” (quoting State v. Beach, 630 N.W.2d 598, 600 (Iowa 2001))). The
ICRA’s requirement that an employer “regularly employ” four or more
employees does not include a requirement the employer must do so for
twenty weeks.
Nonetheless, we must give effect to the word “regularly” as used in
the small-business exemption. Our statute is unlike Ohio’s in which the
numerosity requirement merely states “any person employing four or
28
more persons within the state.” Ohio Rev. Code Ann. § 4112.01 (West,
Westlaw current through 2017 File 4). Such a statute would not require
a minimum period during which the requisite number must be employed
and could be interpreted to apply if the employer merely had four
employees at the time of the discrimination. See Cisneros v. Birck, No.
94APE08–1255, 1995 WL 222156, at *5 (Ohio Ct. App. Apr. 11, 1995)
(“The statute does not say that an employer is any person who employed
four people during any period of time whatsoever. . . . [I]t is apparent
that the legislature meant that the employer must have at least four
employees at the time the discrimination occurred.”). But “we must ‘give
effect, if possible, to every clause and word of a statute.’ ” TLC Home
Health Care, L.L.C. v. Iowa Dep’t of Human Servs., 638 N.W.2d 708, 713
(Iowa 2002) (quoting United States v. Menasche, 348 U.S. 528, 538–39,
75 S. Ct. 513, 520 (1955)).
At the time of the ICRA’s enactment, the workers’ compensation
laws in many states applied to employers who “regularly employed” the
requisite number of individuals. In Mobile Liners, Inc. v. McConnell, the
Alabama Supreme Court adjudicated whether a steamboat company
“regularly employ[ed]” less than sixteen employees under that state’s act.
126 So. 626, 627 (Ala. 1930). The employer continuously employed nine
people to do office work, but employed many more as checkers when
steamboats came into port. Id. at 628. “These checkers were not
employed every day, but were employed for each vessel when it was in
port,” and the arrival of the vessels occurred at regular intervals. Id. The
court determined the employer “regularly” employed more than sixteen
individuals, despite the intermittent nature of the work. Id. at 631. The
McConnell court stated,
29
The word “regularly” is not synonymous with “constancy.”
There are businesses of importance which employ numbers
of men regularly, who employ none of them continuously.
And a number of businesses, as this, will require a large
number of employees, nearly all or a large number of whom
are employed only periodically, for the reason that the needs
of the business require their services only at intervals or
periods, whenever the business is in active operation. We
may illustrate by amusement parks, theaters, places of
entertainment, building or construction contractors who
have or may have many men working for them, and yet fall
within the class of those who cannot foretell the number of
workmen they will have or need on the first of the next
month or a given, designated date.
Id. at 629. The proper focus was on the employer and “whether the
occurrence is or is not an established mode or plan in the operation of the
business.” Id. at 630. In other words, if the employer’s typical method of
transacting business involved the work of the requisite number of
employees, then the employer was covered by the Act. See id. Many
other courts had taken the same approach at the time the ICRA was
enacted. 4
4The Arizona Supreme Court observed, “[W]here in the ordinary conduct of an
employer’s business he customarily or regularly employs the number required to make
the act applicable to him . . . he is within the provisions of the [Workers’ Compensation]
Act.” Marshall v. Indus. Comm’n, 156 P.2d 729, 732 (Ariz. 1945) (collecting cases); see
also Grant v. Alaska Indus. Bd., 11 Alaska 355, 361 (D. Ct. 1947) (“[W]hen the statutory
number of persons is employed most of the time so that it can be said to be the rule
rather than the exception; or where . . . the event or condition requiring their
employment is a regularly recurring one in the ordinary course of the business, the
employer is within the Act.” (Citation omitted.)); Wallace v. Wells, 255 S.W.2d 970, 973
(Ark. 1953) (noting employer “had five men regularly employed, although some of them
worked only two days a week”); France v. Munson, 3 A.2d 78, 81 (Conn. 1938) (“The
word ‘regularly’ implies a practice [of employment] . . . .”); Mathers v. Sellers, 113 So. 2d
443, 444 (Fla. Dist. Ct. App. 1959) (“It is also the general rule that coverage is imposed
where there is uniformity of practice in the particular business of the employer and the
requisite number of employees are employed . . . .”); McDonald v. Seay, 8 S.E.2d 796,
797 (Ga. Ct. App. 1940) (concluding employer within purview of Act when “employer . . .
testified that it was his custom or plan of operation to work as many as twelve men
thirty per cent. [sic] of the time”); Fowler v. Baalmann, Inc., 234 S.W.2d 11, 14 (Mo.
1950) (en banc) (“And ‘regularly’ as used in the statute ‘refers to the question whether
the occurrence is or is not in an established mode or plan in the operation of the
business, and has no reference to the constancy of the occurrence.’ ” (quoting
McDonald, 8 S.E.2d at 797)); Adams v. Ross, 243 N.Y.S. 464, 467 (App. Div. 1930)
30
“The number of persons used to carry out the established mode of
performing the work of the business is determinative even though the
work may be recurrent instead of constant.” Cotman v. Green, 356
S.E.2d 447, 448 (Va. Ct. App. 1987). “The term does not mean constant
employment of the requisite number of persons, but rather is a function
of the frequency, regularity, and duration of the occurrences in which
that number is employed.” LaPoint v. Barton, 328 So. 2d 605, 607 (Ala.
Civ. App. 1976). As the Arizona Supreme Court noted, “The soft drink
business itself is a good example. During the summer months, an
employer may have a large number or employees, and during the winter
have comparatively few.” Marshall v. Indus. Comm’n, 156 P.2d 729, 731
(Ariz. 1945). If the character of the business is such that it is seasonal—
but recurring—in nature, a business that employs over the requisite
number during the season “regularly employs” them under the Act. See
id.; see also Agee v. Indus. Comm’n, 455 P.2d 288, 291 (Ariz. Ct. App.
1969) (“If the employer has a seasonal business and operates only three
months out of the year and during that three-month period has three or
more employees he must be insured.”); Chaney v. Indus. Comm’n, 207
________________________
(per curiam) (“We hold that it is not necessary that four men should be employed during
the entire year, but it is sufficient if such employment continues through a reasonably
definite period of time, and is not casual.”); Hunter v. Peirson, 49 S.E.2d 653, 654 (N.C.
1948) (“If the work pertains to the business of the employer and is within the general
scope of its purpose, the employment is not of a casual nature, although the hiring be
for only a short period of time.” (quoting Johnson v. Asheville Hosiery Co., 153 S.E. 591,
593 (N.C. 1930)); La Croix v. Frechette, 145 A. 314, 315 (R.I. 1929) (“The word ‘regularly’
in the act connotes some uniformity in the practice of the employment of more than five
men.”); Cauchon v. Gladstone, 160 A. 254, 257 (Vt. 1932) (“We think that, in view of the
fact that a helper had been employed for three months, . . . together with the tendency
of the evidence showing the necessity for such a helper,” employer regularly employed
requisite number under the Act.); Annotation, Workmen’s Compensation: Continuity and
Duration of Employment Required by Provisions of Act Making Its Applicability Depend on
Number of Persons Employed, 81 A.L.R. 1232 (originally published in 1932) (Westlaw
current through Apr. 27, 2017).
31
P.2d 816, 817–18 (Colo. 1949) (holding poultry business regularly
employed requisite number when business was seasonal and operated
primarily in summer); Hunter v. Peirson, 49 S.E.2d 653, 654 (N.C. 1948)
(concluding fertilizer delivery service “regularly employed” five or more
during two-month fertilizer season); Grouse v. DRB Baseball Mgmt., Inc.,
465 S.E.2d 568, 570–71 (N.C. Ct. App. 1996) (holding that baseball
company, although seasonal, “regularly employed” four or more
employees during season). On the other hand, infrequent or
unpredictable hiring does not constitute regular employment. Putz v.
Indus. Comm’n, 51 P.3d 979, 983 (Ariz. Ct. App. 2002).
Courts construe numerosity requirements to avoid the “adverse
effects from unusual, temporary conditions.” Cotman, 356 S.E.2d at
448.
If applicability of the Act was influenced by transient factors,
an employer’s status could fluctuate between being subject
to the Act and exempt from the Act. Such instability would
be unsettling for both employer and employees. If an
employer regularly employs [the requisite number] to carry
out the established mode of performing the work of the
business, he should remain subject to the provisions of the
Act even if one or more of the employees works less than full-
time, or if the number of his employees temporarily falls
below [the requisite number.]”
Id. at 448–49. In this way, an employer does not “oscillate between
coverage and exemption as its labor force exceeds or falls below the
minimum from day to day.” Hernandez-Zuniga v. Tickle, 647 S.E.2d 691,
696 (S.C. Ct. App. 2007) (quoting 4 Arthur Larson & Lex K. Larson,
Larson’s Workers’ Compensation Law §§ 74.01–.02 (2000)).
We assume “when a legislature enacts statutes it is aware of the
state of the law.” Rhoades v. State, 880 N.W.2d 431, 446 (Iowa 2016).
By using the same phrase, “regularly employs” found in many
employment-related laws in other states, we assume the Iowa legislature
32
likewise expected the phrase to be construed to avoid day-to-day changes
in the Act’s applicability to particular employers. If a seasonal business
has four or more employees on the payroll during its season, then the
employer is subject to the requirements of the ICRA. See Mobile Liners,
126 So. at 630 (focusing on “whether the occurrence [of requisite number
of employees] is or is not an established mode or plan in the operation of
the business”). We hold Simon Seeding is subject to the Dubuque
ordinance if it had four or more employees on its payroll (not counting its
owner) during the landscaping season.
3. Was there substantial evidence supporting the agency’s
determination that Simon Seeding regularly employs four or more
individuals? Simon Seeding argues even under the DHRC’s
interpretation, there was insufficient evidence that it regularly employed
four or more individuals. The agency’s factual findings must be
supported by “substantial evidence in the record before the court when
that record is viewed as a whole.” Iowa Code § 17A.19(10)(f).
Substantial evidence
means the quantity and quality of evidence that would be
deemed sufficient by a neutral, detached, and reasonable
person, to establish the fact at issue when the consequences
resulting from the establishment of that fact are understood
to be serious and of great importance.
Id. § 17A.19(f)(10)(1).
We conclude there is substantial evidence in the record to support
the DHRC’s determination that Simon Seeding regularly employed four or
more individuals during the landscaping season in 2012. Simon
Seeding’s payroll records show it employed four or more individuals (not
including Leo Simon) for nineteen weeks during March to September
2012. Leo admitted some individuals who he employed were not
33
included on the payroll records. Notably, neither Stapleton nor Jody
James appear on its payroll records, although it is undisputed they were
employed by Simon Seeding during that time.
The DHRC properly relied on an adverse inference from Simon
Seeding’s failure to produce complete payroll records.
It is a well established legal principle that . . . the
failure to produce documents or physical evidence relevant
to the proof of an issue in a legal proceeding supports an
inference that the evidence would have been unfavorable to
the party responsible for its . . . nonproduction.
Phillips v. Covenant Clinic, 625 N.W.2d 714, 718 (Iowa 2001). “When
established, the inference is regarded as an admission by conduct of the
weakness of the party’s case.” Id. We allow an adverse inference for both
evidentiary and punitive reasons. Id. The inference can be used upon a
showing the party intentionally withheld evidence within its control. Id.
at 719.
The adverse inference should be utilized “prudently and sparingly.”
Lynch v. Saddler, 656 N.W.2d 104, 111 (Iowa 2003) (quoting Phillips, 625
N.W.2d at 720). We have refused to allow an adverse inference in cases
in which it was “not clear” whether a party intentionally destroyed or
withheld evidence. Id.; see also Phillips, 625 N.W.2d at 719 (refusing to
allow adverse inference based on “bare speculation and conjecture” that
failure to produce record was intentional). But the record supports the
finding that Leo Simon intentionally failed to maintain proper payroll
records and intentionally withheld records during the DHRC
investigation. The DHRC sent Leo eight letters requesting information,
including payroll documents, during its lengthy investigation. The DHRC
subpoenaed payroll records, and Leo still did not respond for months. It
was only in February 2014, twenty months after the first letter, that Leo
34
finally gave the DHRC the name of his accountant. Upon receiving the
files from her, the DHRC discovered that Leo only listed four employees
on his payroll. Leo said he did not keep records for other individuals
Simon Seeding admittedly employed. The panel and district court
correctly applied the adverse inference. A party cannot escape the
purview of the ICRA or the Dubuque ordinance by failing to keep proper
payroll records or by stonewalling agency investigators. We conclude
that substantial evidence supports the DHRC’s finding that Simon
Seeding regularly employed four or more individuals during the
landscaping season in 2012.
B. Whether There Is Substantial Evidence to Support the
Agency’s Findings. Simon Seeding argues the agency’s findings on
liability and damages are not supported by substantial evidence. We
disagree. “In a substantial-evidence challenge to agency fact-findings,
the court must consider ‘any determinations of veracity by the presiding
officer who personally observed the demeanor of the witnesses.’ ”
Christiansen v. Iowa Bd. of Educ. Exam’rs, 831 N.W.2d 179, 192 (Iowa
2013) (quoting Iowa Code § 17A.19(10)(f)). “The law is well-settled. It is
the agency’s duty ‘as the trier of fact to determine the credibility of the
witnesses, weigh the evidence, and decide the facts in issue.’ ” Id.
(quoting Arndt v. City of Le Claire, 728 N.W.2d 389, 394–95 (Iowa 2007)).
The DHRC and the panel hearing the live testimony credited Stapleton’s
testimony and the testimony of his witnesses and found that Leo Simon
was not credible.
1. Sufficiency of the evidence for hostile work environment. “Hostile
work environment claims are actionable ‘[w]hen the workplace is
permeated with “discriminatory intimidation, ridicule, and insult” that is
“sufficiently severe or pervasive to alter the conditions of the victim’s
35
employment and create an abusive working environment.” ’ ” Farmland
Foods, Inc. v. Dubuque Human Rights Comm’n, 672 N.W.2d 733, 743
(Iowa 2003) (quoting Harris v. Forklift Sys., Inc., 510 U.S. 17, 21, 114
S. Ct. 367, 370 (1993)). It “recognizes workplace discrimination affects
the full spectrum of disparate treatment in the workplace and targets
discrimination that requires employees to work in a discriminatorily
abusive or hostile workplace.” Id. Hostile work environment claims can
be based on racial harassment.
The DHRC found Leo Simon, a supervisor, harassed Stapleton. To
establish a hostile work environment in such circumstances, the
employee must show “(1) he or she belongs to a protected group; (2) he or
she was subjected to unwelcome harassment; (3) the harassment was
based on a protected characteristic; and (4) the harassment affected a
term, condition, or privilege of employment.” Id. at 744. It is undisputed
that Stapleton belonged to a protected group, that the harassment he
suffered was unwelcome, and that the harassment was based on
Stapleton’s race.
Simon Seeding argues the harassment was not “sufficiently severe
or pervasive to alter the conditions of . . . employment.” Id. (quoting
Harris, 510 U.S. at 21, 114 S. Ct. at 370). The employee must prove he
or she “subjectively perceived the conduct as abusive” and that “a
reasonable person would also find the conduct to be abusive or hostile.”
Id.
The objective determination considers all of the
circumstances, including: (1) the frequency of the conduct,
(2) the severity of the conduct, (3) whether the conduct was
physically threatening or humiliating or whether it was
merely offensive, and (4) whether the conduct unreasonably
interfered with the employee’s job performance. These
factors and circumstances must disclose that the conduct
was severe enough to amount to an alteration of the terms or
36
conditions of employment. Thus, hostile-work-environment
claims by their nature involve ongoing and repeated conduct,
not isolated events.
Id. at 744–45 (citations omitted).
In Farmland Foods, Inc., we evaluated a hostile work environment
racial discrimination claim by an employee who claimed his employer
was overly critical of his work and assigned him unfavorable jobs
because of his race. 672 N.W.2d at 738–39. Samuel Taylor worked at a
meat-packing plant in Dubuque, and alleged his supervisor, Dick
Sherman, discriminated against him by reprimanding him for failing to
keep up with production standards and assigning him to an undesirable
position. Id. The DHRC determined that Taylor established a hostile
work environment claim and awarded damages. Id. at 740. The district
court reversed, finding no substantial evidence the conduct was racially
motivated. Id. We held there was insufficient evidence to support the
hostile work environment claim. Id. at 746. We recognized that “[t]he
use of racial epithets may not only support an inference of discrimination
based on race, but may also support an inference that racial animus
motivated the other conduct.” Id. at 745. But we noted the absence of
such epithets in that record:
We acknowledge Taylor felt Sherman picked on him
from time to time and that his feelings were generally
confirmed by the beliefs of some of his coworkers. However,
there is no evidence that Sherman or any other supervisor
ever used any racially derogatory language and the conduct
used to support the claim was neither severe nor pervasive.
Id. at 746. We held that “occasional criticism of an employee’s work
performance by a supervisor, absent references or another nexus to race
or national origin, does not amount to racial harassment.” Id. at 745.
By contrast, Leo regularly referred to Stapleton using racial
epithets, including calling him “chocolate.” See Martin v. Merck & Co.,
37
446 F. Supp. 2d 615, 628 (W.D. Va. 2006) (“The use or reference to
chocolate can indisputably be a racial slur, and thus I find that a
reasonable inference of racial animus can be inferred from the fact that
chocolate was smeared on Martins’ clothing.”); Purnell v. Maryland, 330
F. Supp. 2d 551, 561 (D. Md. 2004) (finding “chocolate bunny” joke
showed racial animus); Boggs v. Die Fliedermaus, LLP, 286 F. Supp. 2d
291, 295, 298 (S.D.N.Y. 2003) (concluding that reasonable jury could
find remark that it was a “ ‘chocolate night’ at Le Bar Bat and refer[ring]
to the three [plaintiffs] as dark, light, and semisweet chocolate” created a
racially hostile environment). Leo admitted to occasionally referring to
Stapleton by these terms, although he testified he did not mean them to
be derogatory. But “racially offensive remarks are not excused if they are
made in a joking manner.” Boggs, 286 F. Supp. 2d at 298. Stapleton
testified that about “ninety percent” of the time he asked Leo to stop
referring to him in that way, yet Leo persisted.
“ ‘A hostile work environment is a cumulative phenomenon,’ and a
series of individual episodes of inappropriate behavior eventually can
amount to a hostile environment.” Alvarez v. Des Moines Bolt Supply,
Inc., 626 F.3d 410, 421 (8th Cir. 2010) (quoting Engel v. Rapid City Sch.
Dist., 506 F.3d 1118, 1124 (8th Cir. 2007)). The “ ‘mere utterance of an
ethnic or racial epithet which engenders offensive feelings in an
employee’ does not affect the terms, conditions or privileges of
employment to a significant degree.” Vaughn v. Ag Processing, Inc., 459
N.W.2d 627, 633 (Iowa 1990) (quoting Rogers v. E.E.O.C., 454 F.2d 234,
238 (5th Cir. 1971), overruled on other grounds by E.E.O.C. v. Shell Oil
Co., 466 U.S. 54, 62 n.11, 104 S. Ct. 1621, 1628 n.11 (1984)). A few
isolated or sporadic racial remarks over a long period of time, or heard
secondhand, may not be enough to establish racial discrimination. See
38
Singletary v. Mo. Dep’t of Corr., 423 F.3d 886, 893 (8th Cir. 2005)
(holding insufficiently severe or pervasive conduct when employee heard
that coworkers and managers referred to him with racial slur); Elmahdi v.
Marriott Hotel Servs., Inc., 339 F.3d 645, 653 (8th Cir. 2003) (affirming
judgment as a matter of law for defendant when African-American
referred to as a “black boy” on a few occasions over several years). But
repeated harassing remarks may be sufficient to establish hostile
working environment. See Chauffeurs, Teamsters & Helpers, Local Union
No. 238 v. Iowa Civil Rights Comm’n, 394 N.W.2d 375, 379 (Iowa 1986)
(concluding racially hostile environment existed when employees
repeatedly referred to employee as “Toby,” a character who portrayed a
slave in the story “Roots,” and harassed him with racist drawings); see
also Fuller v. Fiber Glass Sys., LP, 618 F.3d 858, 864 (8th Cir. 2010)
(finding sufficient evidence when employee repeatedly subjected to
comments about race and gorilla gestures during two-month period).
Stapleton testified Leo called him racial epithets two to three times a
week over the two-month period he worked for Simon Seeding. We
conclude the evidence was sufficient to support the DHRC’s finding that
the conduct was severe enough to alter the terms or conditions of
Stapleton’s employment.
Simon Seeding argues there was insufficient evidence to support a
racially hostile work environment because much of the evidence
supporting the claim came from Stapleton himself, or his mother and
ex-girlfriend. Under Iowa Code section 17A.14,
[a] finding shall be based upon the kind of evidence on which
reasonably prudent persons are accustomed to rely for the
conduct of their serious affairs, and may be based upon
such evidence even if it would be inadmissible in a jury trial.
39
Iowa Code § 17A.14(1). Under this provision, hearsay evidence is
admissible. Clark v. Iowa Dep’t of Revenue & Fin., 644 N.W.2d 310, 320
(Iowa 2002). Stapleton told both his mother and ex-girlfriend of the
harassing treatment as it was occurring in March through May of 2012.
Moreover, other evidence supports Stapleton’s claims. Huinker’s
contemporaneous report of his conversations with Leo corroborates part
of Stapleton’s account of the events of May 6. Another resident
complained that Leo referred to him with a racist remark. Leo admitted
to using the remarks on a few occasions. The DHRC properly considered
such evidence to find there was a racially hostile work environment.
2. Sufficiency of the evidence for award of lost wages. Stapleton
next argues there was insufficient evidence to support the award for lost
wages. “[W]e first acknowledge that the calculation of front pay and back
pay is ‘a judgment call within the province of the commission and not the
court.’ ” Van Meter Indus. v. Mason City Human Rights Comm’n, 675
N.W.2d 503, 513 (Iowa 2004) (quoting Hy-Vee Food Stores, Inc. v. Iowa
Civil Rights Comm’n, 453 N.W.2d 512, 531 (Iowa 1990)). “[A]bsolute
precision in proving what an employee would have earned but for the
employer’s discrimination is not required.” Id. at 514.
The DHRC awarded Stapleton $4500 in lost wages, calculated as
follows: Simon Seeding paid Stapleton $8 per hour, and Stapleton
worked 138 hours from March 15 until May 6. This equals an average of
twenty hours per week, earning a weekly average of $160. The DHRC
found Stapleton lost 262 days of work, or 37.43 weeks. This amounted
to $7817 in lost wages. However, the DHRC reduced that amount based
on Stapleton’s employment at Roofco. We conclude the DHRC correctly
applied the law governing the proof and measurement of lost wages. See
id. at 515 n.5 (using similar calculation to award backpay). We agree
40
with the district court’s conclusion that the DHRC’s calculation is “logical
as opposed to arbitrary, and . . . supported by substantial evidence in
the record.”
3. Sufficiency of the evidence for award of emotional distress
damages. Simon Seeding also challenges the award of emotional distress
damages. It points to other potential causes of Stapleton’s distress and
argues that expert testimony was required to support the award. Simon
Seeding contends the award was not supported by substantial evidence. 5
We disagree.
A person proving discrimination in violation of Dubuque Ordinance
section 8-3-3 is entitled to recover “damages for an injury caused by the
discriminatory or unfair practice.” Dubuque, Iowa, Code of Ordinances
§ 8-4-6(A)(1)(h). Similarly, the ICRA entitles a person proving
discrimination under the Act to compensation for “actual damages.”
Iowa Code § 216.15(9)(a)(8). “We have held damages for emotional
distress are a component of ‘actual damages.’ ” Dutcher v. Randall
Foods, 546 N.W.2d 889, 894 (Iowa 1996) (quoting Chauffeurs, Teamsters
& Helpers, Local Union No. 238, 394 N.W.2d at 383). “A plaintiff need not
5Simon Seeding also argues the DHRC improperly increased the award based
upon the consumer price index. On appeal from the panel’s decision, Stapleton argued
the award of the panel should be increased because cases the panel relied upon were
ten to twenty years old and inflation, as evidenced by the consumer price index,
justified such an increase.
The city’s administrative code, section 3.24(2), provides that a commission can
only “consider those issues actually presented to the hearing officer.” Dubuque, Iowa,
Admin. Code § 3.24(2). Simon Seeding points out the consumer price index argument
was not raised before the panel. Simon Seeding argues the DHRC nonetheless
impermissibly relied upon such evidence because of a newspaper article that was
released, which quoted an officer of the DHRC. The officer stated the DHRC felt the
award was “appropriate for 2015.”
The consumer price index is mentioned nowhere in the DHRC’s final decision,
and the district court correctly declined to speculate that the DHRC relied on the
consumer price index to increase the award.
41
show physical injury, outrageous conduct or severe distress to obtain an
award for emotional distress” under the ICRA. Id. “Determining the
amount of damage attributable to a defendant’s conduct is a matter for
the trier of fact.” Lynch I, 454 N.W.2d at 836. “The adequacy of the
award in a particular case depends on the unique facts of that case”;
thus, comparison with other cases is of little value. Id. The verdict is
inadequate or excessive when “uncontroverted facts show that it bears
no reasonable relationship to the loss suffered.” Id. at 837.
Whether Leo’s conduct caused Stapleton’s emotional distress was a
question for the fact finder. Stapleton was in a halfway house and
suffering from drug addiction relapses. Those stressors could make him
more vulnerable to mental trauma from Leo’s slurs. See Mika’il
DeVeaux, The Trauma of the Incarceration Experience, 48 Harv. C.R.-C.L.
L. Rev. 257, 258 (2013) (reviewing emotional impact of prison). Defense
counsel vigorously cross-examined Stapleton, his mother, and his
ex-girlfriend on these topics. The DHRC was entitled to credit their
testimony that Stapleton’s distress resulted from Leo’s racial epithets.
Stapleton described it as a “scar that never goes away.” Stapleton’s
ex-girlfriend and mother testified that before his problems at Simon
Seeding, he was “happy-go-lucky” while afterwards he was “irritable” and
“agitated.”
We disagree that expert testimony was required to support this
award for emotional distress. Under different circumstances, we have
reversed awards made without supporting expert testimony. In Vaughn,
we reviewed an award of emotional distress damages under a common
law theory of intentional infliction of emotional distress. 459 N.W.2d at
637. Howard Vaughn alleged religious discrimination after his
supervisor made anti-Catholic remarks directed at Vaughn. Id. at 631.
 42
At trial, when asked about emotional problems from the statements,
Vaughn responded, “I’ve never really thought about it.” Id. at 636. He
testified that while working he felt “upset,” “grouchy,” and “nervous.” Id.
After the harassment he lost fifty pounds and became ill with colitis. Id.
at 637. The court awarded emotional distress damages. Id. at 631–32.
We noted the absence of expert testimony and concluded there was
insufficient evidence to support the award. Id. at 637.
While it is not clear from the record when plaintiff saw his
physician, the physician did not testify at trial. The plaintiff
simply does not have the medical expertise to explain the
relationship of his work environment to physical symptoms
which peaked three months after he left his employment. . . .
The causal relationship between Mueller’s conduct and
plaintiff’s symptoms is not within the common experience of
a jury.
Id.
Under the ICRA, however, we have allowed emotional distress
damages without expert testimony. See, e.g., City of Hampton v. Iowa
Civil Rights Comm’n, 554 N.W.2d 532, 537 (Iowa 1996). While the
testimony of a physician or psychiatrist can help prove causation, in
some instances this inquiry will be “so obvious as to be within the
common knowledge of laypersons without the aid of expert testimony.”
Oswald v. LeGrand, 453 N.W.2d 634, 639 (Iowa 1990) (noting no need for
expert testimony in such circumstances); see, e.g., Hy-Vee Food Stores,
Inc., 453 N.W.2d at 526 (relying on expert testimony from dermatologist
about how plaintiff’s skin condition worsened after harassment).
We have noted the lack of expert testimony when reviewing awards
for emotional distress under the ICRA. In City of Hampton, an
administrative law judge (ALJ) awarded $50,000 for emotional distress
when an employee testified that she had become very upset by her
43
supervisor’s threats to sue her and was losing sleep. 554 N.W.2d at 537.
We reviewed prior emotional distress awards, stating,
In awarding [the employee] $50,000 for her emotional
distress, the ALJ relied almost solely on the testimony of
Abbas and her daughter. Abbas presented no medical
evidence. When considering the amount of damages, it is
not particularly helpful to compare this with other cases.
Lynch, 454 N.W.2d at 836. Nevertheless, we note that this
award exceeds any under similar circumstances in a civil
rights case. For example, in Hamer v. Iowa Civil Rights
Commission, 472 N.W.2d 259, 266 (Iowa 1991), we approved
an award of $5000 for emotional distress based on sex
discrimination. In Lynch, we approved an award of $10,000
based on a sexually hostile work environment, 454 N.W.2d
at 836–37, and in Hy-Vee Food Stores, . . . we approved an
award of $10,000 for emotional distress based on sex and
national origin discrimination. 453 N.W.2d at 525–26. In
Chauffeurs, Teamsters & Helpers Local Union No. 238 . . . ,
394 N.W.2d [at] 384–84[,] we approved $15,000 as an award
based on racial discrimination.
Id. We concluded $50,000 was excessive and reduced the award to
$20,000. Id. We did so “based on the relatively small amount of
evidence supporting the award and the total lack of any medical or
psychiatric evidence to support it,” noting the ICRA does not allow for
“punitive damages” disguised as an award for emotional distress. Id.
Similarly, Stapleton relies solely on lay testimony. He alleged no
physical manifestations of the distress other than losing sleep. The
DHRC’s award in this case is larger than other recent awards.
Significantly, the panel awarded Stapleton $15,000, which the DHRC
tripled without explanation. But the DHRC is the ultimate fact finder,
and we review the findings of that agency, not the panel. Given the
ongoing repetitive nature of Leo Simon’s racially offensive epithets and
the lay testimony as to how the mistreatment affected Stapleton, we
cannot conclude the DHRC abused its discretion in increasing the award.
The size of the award is supported by the record.
44
4. Sufficiency of the evidence for award of attorney fees. Finally,
Simon Seeding argues the DHRC lacked the authority to increase the
award of the panel’s attorney fees by $1600, and the district court lacked
the authority to increase the award by $4500 for the cost of the appeal.
Simon Seeding does not otherwise challenge the reasonableness of the
fees or hourly rate.
“Because attorneys’ fee awards are a derogation of the common
law, they ‘are generally not recoverable as damages in the absence of a
statute or a provision in a written contract.’ ” Botsko, 774 N.W.2d at 845
(quoting Kent v. Emp’t Appeal Bd., 498 N.W.2d 687, 689 (Iowa 1993)).
When assessing whether attorney fees are allowed under a civil rights
ordinance enacted pursuant to Iowa Code section 216.18, the relevant
question “is whether the ordinance . . . contained an express provision
clearly authorizing an award of attorneys’ fees.” Id. at 846. We reiterate
the importance of fee awards in civil rights cases: “The reason a
successful civil rights litigant is entitled to attorney fees ‘is to ensure that
private citizens can afford to pursue the legal actions necessary to
advance the public interest vindicated by the policies of civil rights
acts.’ ” Lynch II, 464 N.W.2d at 239 (quoting Ayala v. Ctr. Line, Inc., 415
N.W.2d 603, 605 (Iowa 1987)). Nevertheless, we will not substitute
“generalized language” for language “expressly authorizing the payment
of attorneys’ fees to the prevailing party.” Botsko, 774 N.W.2d at 846.
Dubuque Ordinance section 8-4-6 allows the DHRC to take
“remedial actions,” including “[p]ayment to the complainant of damages
for any injury caused by the discriminatory or unfair practice, which
damages shall include . . . reasonable attorney fees.” Dubuque, Iowa,
Code of Ordinances § 8-4-6(A)(1)(h). The DHRC, when reviewing a
panel’s award, has “all the power it would have in initially making the
45
final decision.” Dubuque, Iowa, Admin. Code § 3.24(2). The DHRC may
modify the panel’s award, including the panel’s award of attorney fees.
We hold this Dubuque Ordinance 8-4-6 permits an appellate fee award.
“District courts exercise appellate jurisdiction over agency actions on
petitions for judicial review.” Christiansen, 831 N.W.2d at 186. Section
8-4-6 is worded similarly to Iowa Code section 216.15(9)(a)(8) (“Payment
to the complainant of damages for an injury caused by the
discriminatory or unfair practice which damages shall include but are
not limited to actual damages, court costs and reasonable attorney
fees.”). We have allowed an award of appellate attorney fees under this
section. Landals v. George A. Rolfes Co., 454 N.W.2d 891, 898–99 (Iowa
1990) (“To the extent that Landals was entitled to an award of attorney
fees for his litigation expense before the district court, he is likewise
entitled to an award of fees necessitated by this appeal.”). The DHRC
and district court properly awarded fees Stapleton incurred after the
panel award.
IV. Disposition.
For those reasons, we affirm the judgment of the district court
upholding the decision of the DHRC.
DISTRICT COURT JUDGMENT AFFIRMED.
All justices concur except Appel and Wiggins, JJ., who concur
specially.
46
#16–1014, Simon Seeding & Sod v. Dubuque Human Rights Comm’n
APPEL, Justice (concurring specially).
I concur in the majority opinion but write separately to emphasize
four points.
First, the Iowa legislature has directed us to broadly construe the
Iowa Civil Rights Act to accomplish its remedial purposes. Iowa Code
§ 216.18(1) (2015). The majority opinion is consistent with that
legislative direction.
Second, the Iowa Civil Rights Act has fundamental differences from
the Federal Civil Rights Act. The structure is different, the legislative
history is different, and in many places the Iowa statute utilizes different
statutory language than federal law. See Goodpaster v. Schwan’s Home
Serv., Inc., 849 N.W.2d 1, 9–10 (Iowa 2014); accord DeBoom v. Raining
Rose, Inc., 772 N.W.2d 1, 7 (Iowa 2009) (“[W]e must be mindful not to
substitute ‘the language of the federal statutes for the clear words of the
Iowa Civil Rights Act.’ ” (quoting Hulme v. Barrett, 449 N.W.2d 629, 631
(Iowa 1989)). These distinctive features are among the factors which
must be taken into account in evaluating whether federal authority
should be considered persuasive in the interpretation of state law.
Third, as the majority clearly demonstrates, the Iowa legislature
adopted a traditional fact-based numerosity analysis by using the term-
of-art “regularly employed” rather than the more formulaic approach
embraced in federal law. While the federal approach is said to provide a
“bright line,” a cursory review of the federal caselaw struggling with
application of the federal numerosity requirement provides a serious
challenge to that assumption. See generally David C. Butow, Note,
Counting Your Employees for Purposes of Title VII: It’s Not as Easy as One,
Two, Three, 53 Wash. & Lee L. Rev. 1103 (1996); Jacqueline Louise
47
Williams, Note, The Flimsy Yardstick: How Many Employees Does it Take
to Defeat a Title VII Discrimination Claim?, 18 Cardozo L. Rev. 221 (1996).
But, more importantly, the Iowa legislature has concluded that a fact-
driven numerosity analysis is more likely to advance the purposes of the
Iowa Civil Rights Act rather than an arbitrary bright-line numerosity
requirement that does not take into account differences in the
employment practices and calendars of specific industries and
employers. The Iowa legislature is free to choose a more tailored fact-
bound test of regular employment rather than a blunt and somewhat
arbitrary bright-line approach of federal law.
Fourth, when a court is urged to adopt a bright-line interpretation
of a statutory provision, the question is usually not simply whether the
bright line is workable or provides for certainty and predictability. Also
of import, and sometimes of more importance, is where the proposed
bright line has been located on the policy spectrum.
Here, Congress has elected to include some seasonal employers
who employ the requisite number of employees for a relatively long period
of time, but exclude employers who employ seasonal employees for a
shorter period of time. Iowa has deliberately chosen a different
substantive policy.
It is, of course, not surprising that the national political process, in
which widely disparate federal actors have a voice, has produced a
different policy than the more localized political process in Iowa. In any
event, this case does not simply involve the dry methodological question
of whether a bright-line approach to numerosity is better than a fact-
based approach. It involves a fundamental policy question regarding the
scope of coverage of employers who hire short-term seasonal workers.
The majority opinion correctly hews to the policy choice embraced by the
48
Iowa legislature and does not substitute a federal legislative choice made
as a result of a materially different political process that produced a
substantially different legislative result.
Wiggins, J., joins this special concurrence.