Karen Chelton v. Provident Companies, Inc. ( 2003 )

IN THE COURT OF APPEALS OF TENNESSEE
AT KNOXVILLE
April 3, 2003 Session
KAREN CHELTON v. PROVIDENT COMPANIES, INC., ET AL.
Appeal from the Chancery Court for Hamilton County
No. 99-0089 W. Frank Brown, III, Chancellor
FILED JUNE 19, 2003
No. E2002-2282-COA-R3-CV
In this appeal from the Chancery Court for Hamilton County the Plaintiff/Appellant, Karen Chelton,
asserts that the Trial Court erred in granting the Defendants/Appellees, Provident Companies, Inc.
and Provident Life & Accident Insurance Company (hereinafter "Provident"), summary judgment
against her with regard to her cause of action for age discrimination under the Tennessee Human
Rights Act. We affirm the judgment of the Trial Court in part, vacate in part and remand for a trial
on the merits. Costs of this appeal are adjudged equally against Ms. Chelton and Provident.
Tenn. R. App. P. 3; Judgment of the Chancery Court Affirmed in Part and Vacated in
Part; Cause Remanded
HOUSTON M. GODDARD , P.J., delivered the opinion of the court, in which HERSCHEL P. FRANKS and
D. MICHAEL SWINEY, JJ., joined.
Boyd Stewart Jenkins, Chattanooga, Tennessee, for the Appellant, Karen Chelton
Christopher Harper Steger, Chattanooga, Tennessee, for the Appellees, Provident Companies, Inc.
and Provident Life & Accident Insurance Company
OPINION
Ms. Chelton was born on August 31, 1941. In 1962 she was hired by Provident as a mail
clerk and over the next several years she was employed by Provident in a variety of positions in the
areas of accounting, customer service, sales promotion, cashier work, bookkeeping and sales.
In September of 1985 Ms. Chelton was transferred from her position in telemarketing sales
to the position of associate underwriter and in 1986 she became an underwriter in Provident’s mass
marketing department. Job appraisals and memoranda issued in 1988, 1989 and 1990 indicate that
Ms. Chelton was exhibiting problems in performing her duties as an underwriter. Ms. Chelton
agrees that she was not performing well as an underwriter and in July of 1990 she advised Provident
that she wished to work in marketing. In June of 1991 she began working with Provident's
marketing materials and was subsequently given the job title of "marketing support specialist." Ms.
Chelton’s underwriting duties decreased after 1992 and were eventually phased out altogether.
As of 1995 Ms. Chelton had responsibility for tracking of production, sales materials,
promotional campaigns and communications support. However, in July of 1997, some of these
duties were removed and Ms. Chelton was given the position of "forms analyst." As forms analyst
she was required to, among other things, maintain records and forms and order supplies. In addition
to these duties Ms. Chelton was, in October of 1997, assigned to work on a “rebranding” project to
change Provident’s logo on all company forms in her department. Ms. Chelton testified that, after
October of 1997, her duties as forms analyst encompassed about fifty percent of her time and her
duties in the rebranding project encompassed the remainder. Also, in October of 1997, Pam Nowlin
became Ms. Chelton’s immediate supervisor.
Ms. Chelton asserts that, after becoming her supervisor, Ms. Nowlin would not respond to
questions from Ms. Chelton about her job and would not speak when the two passed in the hallway.
Ms. Chelton attests that Ms. Nowlin would call staff meetings without informing her and then
express anger with her for not attending. Ms. Chelton further attests that Ms. Nowlin gave a
Christmas luncheon for all of her employees in December of 1997 and did not invite Ms. Chelton.
Ms. Chelton maintains that her treatment by Ms. Nowlin was designed to cause her to voluntarily
terminate her employment with Provident
In February of 1998 Ms. Chelton was given the job title of “staff support technician”. Ms.
Chelton testified that, although this job was basically the same as the forms analyst position, the
change in job title resulted in a drop in job points under the Company’s point system1 from 404
points to 245 points. Ms. Chelton testified that she was advised by Ms. Nowlin that she would not
be eligible for a raise until her points returned to 404. The change in job title also resulted in the re-
classification of Ms. Chelton’s job status from exempt (salaried) status to non-exempt (hourly)
status. Ms. Chelton’s salary was not reduced as a result of the change in job title.
In April of 1998, Ms. Chelton met with Ms. Nowlin and Debbie McClanahan, manager of
human resources, was advised that there were problems with her job performance and was advised
that she was being placed on probation for ninety days. In addition, a procedure was set up pursuant
to which she would meet with Ms. Nowlin once a week to discuss performance issues.
On May 12, 1998, Ms. Chelton filed a complaint with the Equal Employment Opportunity
Commission alleging that she was being discriminated against because of her age.
On June 17, 1998, Ms. Chelton again met with Ms. Nowlin and Ms. McClanahan. At this
meeting Ms. Nowlin advised Ms. Chelton that she had not improved and that she was, therefore,
1
During the time in question Provident implemented the “Hay point system” pursuant to which a particular job
was assigned a point value which determined the employee’s salary range based upon the job’s market value.
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being terminated effective June 30, 1998. Ms. McClanahan confirmed in deposition testimony that,
although the decision to discharge Ms. Chelton was a team decision, Ms. Nowlin initiated the
decision and that, if Ms. Nowlin had determined that Ms. Chelton had “improved performance up
to standards, then there would be no termination.”
On January 27, 1999, Ms. Chelton filed a complaint in the Chancery Court for Hamilton
County stating that she was demoted from her position as an underwriter, that the points upon which
her salary and raises were based were reduced from 404 to 245 and that “she was discharged
intentionally and solely because of her age.” In consequence of these actions, Ms. Chelton charges
Provident with violation of the Tennessee Human Rights Act and demands back pay in the amount
of $75,000.00, front pay in the amount of $315,000.00 and compensatory damages in the amount of
$300,000.00 for humiliation, embarrassment and mental anguish.
Following completion of discovery, Provident filed a motion for summary judgment. On
August 19, 2002, the Trial Court entered its memorandum opinion and order granting such motion
and Ms. Chelton’s complaint was dismissed. This appeal followed.
The sole issue addressed herein, as restated, is whether the Trial Court erred in granting
Provident a summary judgment.
In Staples v. CBL & Associates, Inc., 15 S.W.3d 83, 89 (Tenn. 2000) the Tennessee Supreme
Court set forth the standard of review appropriate to summary judgments as follows:
The standards governing the assessment of evidence in the summary judgment
context are also well established. Courts must view the evidence in the light most
favorable to the nonmoving party and must also draw all reasonable inferences in
the nonmoving party's favor. See Robinson v. Omer, 952 S.W.2d [423]at 426;
Byrd v. Hall, 847 S.W.2d [208] at 210-211. Courts should grant a summary
judgment only when both the facts and the inferences to be drawn from the facts
permit a reasonable person to reach only one conclusion. See McCall v. Wilder,
913 S.W.2d 150, 153 (Tenn.1995); Carvell v. Bottoms, 900 S.W.2d 23,26
Tenn.1995).
Because a trial court's decision to grant a motion for summary judgment is solely a matter
of law, it is not entitled to a presumption of correctness. See Carvell v. Bottoms, 900 S.W.2d 23(Tenn.1995). In determining whether such a decision is correct we must review the record to
determine if the requirements of Rule 56.04 of the Tennessee Rules of Civil Procedure have been
satisfied in that "there is no genuine issue as to any material fact and that the moving party is entitled
to a judgment as a matter of law."
As previously noted, Ms. Chelton filed her complaint in this case pursuant to the Tennessee
Human Rights Act which appears at T.C.A. 4-21-101, et seq. Tennessee courts have recognized that
the purpose and intent of this act is to provide for the execution, in Tennessee, of policies embodied
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in federal civil rights laws. Accordingly, the courts of this state have been guided by federal law
when analyzing claims under the Tennessee Human Rights Act. Campbell v. Florida Steel Corp.,
919 S.W.2d 26 (Tenn. 1996) and Bruce v. Western Auto Supply Co., 669 S.W.2d 95 (Tenn. Ct. App.
1984).
The burden shifting analysis applicable in a case such as this one, where there is no direct
evidence of discrimination, is as follows. First, a prima facie case of age discrimination must be
established by proof that the plaintiff (1) was at least forty years of age (2) was subject to adverse
employment action (3) was qualified for the position and (4) was replaced by a younger person.
McDonnell Douglas Corp. v. Green, 411 U.S. 792, 93 S.Ct. 1817 (1973) and Cooley v. Carmike
Cinemas, Inc., 25 F.3d 1325 (6th Cir. 1994).
Once the plaintiff has proved a prima facie case, the burden shifts to the defendant who must
submit legitimate, nondiscriminatory reasons for its action. If the defendant meets this burden the
plaintiff must prove by a preponderance of evidence that the reasons proffered by the defendant for
its actions were merely a pretext for discrimination. The plaintiff must show pretext by proving
“either (1) that the proffered reasons had no basis in fact (2) that the proffered reasons did not
actually motivate his discharge, or (3) that they were insufficient to motivate discharge.” Manzer
v. Diamond Shamrock Chemicals Company, 29 F.3d 1078 (6th Cir. 1994), quoting McNabola v.
Chicago Transit Authority, 10 F.3d 501, 513 (7th Cir. 1993), emphasis in Manzer.
In the order and memorandum opinion entered by the Trial Court in this case the Court
concluded as follows:
First, the court determined that Ms. Chelton could not establish the prima facie
age discrimination claim for the alleged demotion from the underwriter position.
Because she had not been performing the underwriting job for many years prior
to February of 1998, Ms. Chelton’s claim would be time-barred as of the date of
she left the underwriting position. Second, the court concluded that Ms. Chelton
could not establish the prima facie age discrimination claim for her 1998
termination because a younger employee did not replace her. These two decisions
alone warrant the dismissal of Ms. Chelton’s claims. However, the court then
went on to consider the remaining issues. Even if Ms. Chelton could establish the
prima facie age discrimination case, which she has failed to do, the court has
determined that Provident has articulated a legitimate, non-discriminatory reason
for her termination. Further, Ms. Chelton has not rebutted Provident’s legitimate,
non-discriminatory reason by establishing that such reason was false, insufficient
to support her termination, or unrelated to her discharge.
We must first review the record to determine whether there is any evidence from which a
reasonable person could conclude, contrary to the Trial Court’s findings, that the elements of a prima
facie case of age discrimination have been established.
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With respect to the elements required to establish a prima facie case of age discrimination
Provident does not dispute that Ms. Chelton was over forty years of age or that she was qualified for
the position from which she was discharged. Rather, Provident contends that Ms. Chelton failed to
establish a prima facie case of age discrimination because she was not subject to an adverse
employment action and because she was not replaced by a younger person. First we address
Provident’s contention that Ms. Chelton was not subject to an adverse employment action when her
job title was changed.
The Trial Court determined that Ms. Chelton “presented insufficient evidence to support her
contention that she was the subject of an adverse job action in 1998 when her job title was changed
to staff support technician and her job points were reduced from 404 to 245.” The Court goes on to
state as follows:
The February 1998 job description and points change simply cannot be described
as a demotion from Ms. Chelton’s prior title as underwriter because, as she has
admitted, she had not been performing as an underwriter for a number of years.
She could not be demoted from a position she had not held for years. This alleged
demotion was not an adverse employment action and the court will grant the
Defendant’s motion as to this claim.
The Court concluded that, because Ms. Chelton had not been employed as an underwriter for
a number of years, the one year statute of limitations for violations under the THRA barred her
action for demotion as an underwriter.
We are compelled to disagree with the Trial Court’s reasoning that, because Ms. Chelton had
not performed as an underwriter for years, the action taken by Provident in February of 1998 was not
an adverse employment action. While the fact that Ms. Chelton was no longer performing the
services of an underwriter may have presented Provident with a legitimate reason for changing her
job title, this does not answer the question of whether the change in title with its attendant
consequences was an adverse employment action. Whether Provident had a legitimate reason for
its action is not relevant in determining whether its actions were adverse. Although Ms. Chelton had
not been employed as an underwriter for some time, no adverse action was taken by Provident, in
consequence of that fact, until February of 1998.
Provident argues that the reduction in job points did not result in tangible detriment to Ms.
Chelton and that the harm claimed by Ms. Chelton is speculative harm. Provident asserts that,
because the harm claimed by Ms. Chelton is hypothetical, the change in job title with its resulting
diminishment in job points does not constitute an adverse employment action. We find it
unnecessary to address this argument based upon other conclusions we have reached as set forth
hereinafter.
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Although Ms. Chelton additionally states that the change in her job title also resulted in a
change in her status from that of exempt (salaried) employee to non-exempt (hourly) employee, she
presents no evidence to support a finding that this status difference had adverse consequences.
Ms. Chelton cites Frazier v. Heritage Federal Bank, 955 S.W.2d 633 (Tenn. Ct. App. 1997)
to support her argument that she suffered “materially adverse changes” in the terms and conditions
of her employment as a result of Ms. Nowlin’s alleged refusal to speak to her, refusal to answer
questions, failure to advise her of meetings and failure to invite her to the employee Christmas
dinner. We do not agree that the treatment Ms. Chelton alleges she received from Ms. Nowlin is
comparable to the treatment received by the plaintiff in Frazier. In that case the plaintiff was a
senior vice president of a bank when, at the age of fifty three, she was moved from the bank’s
customer service department to its customer relations department. The next year, when the bank was
converted to a publicly held company, the plaintiff was not offered any of the benefits of the stock
option plan or listed on the company prospectus and the prospectus indicated that other executive
officers were receiving substantially higher salaries than she was. After completing projects, she was
not assigned new ones, was excluded from meetings and could not get secretarial support. This
Court found that, although the plaintiff’s salary had not been reduced, “the constant reduction in her
duties and prestige at the bank were ‘materially adverse changes’ in her terms and conditions of
employment sufficient to qualify as discriminatory actions.” We do not find the actions Ms. Chelton
attributes to Ms. Nowlin to be analogous to the actions of the bank in Frazier. We find no evidence
of a “constant reduction” in Ms. Chelton’s “duties and prestige.” In fact, Ms. Chelton states in her
brief that her “job duties were essentially the same after Pam Nowlin became her supervisor.”
Aside from asserting that she suffered an adverse employment action by reason of her title
change in February of 1998, Ms. Chelton also asserts, as noted, that she was subject to an adverse
employment action by reason of the termination of her employment on June 30, 1998. It is not
disputed that Ms. Chelton’s termination was an adverse employment action.
While not disputing that Ms.Chelton’s termination was an adverse employment action,
Provident contends that Ms. Chelton has still not submitted proof establishing a prima facie case of
age discrimination by showing that she was replaced by a younger person. Provident maintains,
rather, that Ms. Chelton’s duties were divided between a number of employees after her termination.
Citing Majewski v. Automatic Data Processing, Inc., 274 F.3d 1106 (6th Cir. 2001) and Brenner v.
Textron Aerostructures, 874 S.W.2d 579 (Tenn. Ct. App. 1993), Provident notes that, under both
state and Federal case law, when a former employee’s duties are redistributed among remaining
employees upon termination this does not constitute replacement. Provident argues that the record
shows that, after Ms. Chelton’s discharge, her duties with respect to the ordering of company forms
and materials was performed on-line, her rebranding duties were assigned to Eugenia Smith and the
remaining duties which she had performed were assigned to Paula Shipley, a younger employee, who
Ms. Chelton attests was in her twenties or early thirties.
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The sole evidence referenced by Provident in support of its assertion that a portion of Ms.
Chelton’s duties were performed on-line after her termination consists of the following testimony
of Ms. Nowlin:
Q Who took Karen’s job when she left?
A The ordering of the forms and stuff went on-line, I believe.
Q On-line?
A Computer, you know, maybe. ...
(Emphasis added.)
This Court has noted on prior occasion that “[b]elief, no matter how sincere, is not equivalent
to knowledge.” Keystone Ins. Co. v. Griffith, 659 S.W.2d 364 (Tenn. Ct. App. 1983). Because Ms.
Nowlin has qualified her testimony by indicating that it is based upon her belief and further indicated
her uncertainty by use of the word “maybe” it is our determination that a jury could reasonably infer
that Ms. Nowlin, in fact, did not actually know what happened to Ms. Chelton’s duties with regard
to the ordering of company forms and materials.
Provident also points out that Ms. Chelton’s duties pertaining to the rebranding of company
materials were assigned to Eugenia Smith. Ms. Chelton’s acknowledges that rebranding accounted
for fifty per cent of her job when she was working as staff support technician; however, in the
itemization of duties set forth in Provident’s description of the position of “staff support technician”,
the rebranding of materials is not included. Ms. Chelton contends that the rebranding of materials
was merely a temporary project assigned to her. This contention is supported by deposition
testimony of Ms. Nowlin. As previously noted Ms.Nowlin gave Ms. Chelton responsibility for the
rebranding of materials when she took over as her supervisor in October of 1997. When asked if she
changed Ms. Chelton’s job duties when she became her supervisor, Ms. Nowlin testified as follows:
Q When you took over supervising Karen Chelton, did you change her job duties
at all?
A No. The rebranding of the materials that she worked on and ordered supplies
for, all of those items had to be rebranded because of mergers. By rebranding,
changing the logos that are on them. So that just fell naturally. That wasn’t a new
job assignment, it was something that was short term that she had to work on
because she supplied those forms to the field and to sales support and various
people.
Q But her job duties, what she actually did –
A Uh-huh.
Q – remained the same during the time that she worked for you?
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A Yes....
(Emphasis added.)
It is our determination that a jury could reasonably conclude from this testimony that the re-
branding of materials was merely a temporary project and not part of Ms. Chelton’s regular job
duties.
Furthermore, we find nothing in that portion of Ms. Nowlin’s deposition testimony
referenced by Provident which supports its contention that Ms. Chelton’s rebranding duties were
redistributed to Ms. Smith upon Ms. Chelton’s termination. On the contrary, Ms. Nowlin’s
testimony indicates that only part of Ms. Chelton’s rebranding responsibilities were assigned to
Eugenia Smith and that such assignment occurred in March of 1998 and, therefore, prior to Ms.
Chelton’s termination:
...As we moved through the rebranding process and it wasn’t working, what I did
was I consolidated one piece of Karen’s – Karen didn’t view part of the rewriting,
looking at the brochures and determining whether they were right, or the
pamphlets or whatever, articles of paper that were being reviewed at that point for
rebranding, she just routed it. She coordinated routing the documents to the
various departments, whether it be the corporate communications law department,
to an expert to read within voluntary benefits to review the material to see that the
verbiage was right.
Q Uh-huh.
A Karen didn’t understand that part of the job. So what we did was we let
Eugenia, who was doing EB, that’s another part –
...
Q EB standing for employ benefits?
A Yes. And voluntary benefits are just V.
Q Okay. Go ahead.
A And that was in March. ...
(Emphasis added.)
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When asked who took Ms. Chelton’s job when she left Ms. Nowlin testified that Ms. Smith
“continued to review the documents, because that was working well.” (Emphasis added.)
Finally, we note that when Ms. Nowlin was again asked who took Ms. Chelton’s job after
her discharge she replied, “I would imagine that the pieces that were left, that Paula Shipley took
them over and was handling it.” It is our determination that a jury could reasonably conclude in the
context of Ms. Nowlin’s above testimony that the assignment of rebranding duties prior to Ms.
Chelton’s termination that “the pieces that were left” refers to the portion of Ms. Chelton’s job that
remained after the distribution of some of her branding duties to Ms. Smith in March of 1998 rather
than the portion that remained from a redistribution of her job duties after she was terminated.
In summary, we find sufficient evidence in the record from which a jury could reasonably
conclude that Ms. Chelton was replaced by a younger person and Provident’s argument that she has
failed to create a genuine issue of material fact in this regard is without merit.
Having concluded that there is sufficient evidence in the record to create a genuine issue of
material fact with respect to the establishment of a prima facie case of age discrimination, we must
now review the record to determine if there is sufficient evidence to create a genuine issue of
material fact as to whether the reasons proffered by Provident for changing Ms. Chelton’s job title
and terminating her employment were merely a pretext for discrimination.
Provident asserts that the change in Ms. Chelton’s job title which resulted in her loss of job
points and re-classification as a non-exempt employee was prompted by the fact that Ms. Chelton
was no longer engaged in underwriting duties. Ms. Chelton has the burden of showing that this
reason was a pretext by producing evidence that it had no basis in fact, that it did not actually
motivate Provident’s action or that it was insufficient to motivate Provident’s action.
Although Ms. Chelton asserted in her testimony that it was inappropriate for Provident to
change her job title, we find no evidence in the record to support this assertion. Ms. McClanahan
testified that “[t]he points were reduced to correspond with a more accurate job title that was
assigned to her that accurately reflected what she was doing” and that “she had not performed as an
underwriter, my understanding, for six years and had been performing the other position.” The
following testimony of Ms. Chelton confirms that she had carried a higher number of job points prior
to the change in her job title because she had, until that time, been mis-classified as an underwriter:
Q So you didn’t ask [Ms. Nowlin] in that conversation why the job was carrying
with it less points?
A Less points than what?
Q Than your previous job. You didn’t ask her why - - in the conversation, did you
ask her why your points were being reduced?
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A No. It was because I was being given a new job title and each job title has a
certain amount of points to it. And up until that point I had been classified as an
underwriter. Even though I wasn’t doing the underwriting job, I was still
classified as that.
Ms. Chelton’s testimony confirms the legitimacy of Provident’s proffered reason for
changing her job title. The adversity which Ms. Chelton asserts she suffered as a result of the change
in job title was the loss of her eligibility for raises because of her reduced job points. Ms. Chelton
admits that she was no longer performing work that would have entitled her to continue carrying job
points at her previous level and that she had carried the additional points because she was being
given credit for duties she was not actually performing. Accordingly, we find that Ms. Chelton has
failed to create an issue of fact as to whether Provident’s proffered reason for its action had a basis
in fact.
Additionally, we do not find that Ms. Chelton has created an issue with respect to whether
the reason proffered by Provident for the change in her job title was the actual reason. Under this
alternative she would be required to produce circumstantial evidence of age discrimination in
addition to that necessary to produce a prima facie case and the sheer weight of this evidence would
have to make it more likely than not that Provident’s ostensible reason for changing her job title was
a cover up. Manzer v. Diamond Shamrock Chemicals Company, 19 F3d 1078 (6th Cir. 1994) and
F. Ray White v. Regions Financial Corporation, an unreported opinion of this Court filed in
Knoxville on August 7, 2001. We do not find circumstantial evidence of age discrimination in the
record which could be reasonably construed as sufficient to satisfy this requirement.
Nor do we find that Ms. Chelton has created an issue as to pretext under the alternative which
allows her to show that the reason proffered was insufficient to motivate Provident’s change in her
job title. Under this alternative Ms. Chelton would be required to show that other employees not in
the protected class did not have their job titles changed even though they were similarly situated.
As stated by the Court in Mitchell v. Toledo Hosp., 964 F2d 577 (6th Cir. 1992) at page 577:
Thus, to be “similarly-situated”, the individuals with whom the plaintiff seeks to
compare his/her treatment must have dealt with the same supervisor, have been
subject to the same standards and have engaged in the same conduct without such
differentiating or mitigating circumstances that would distinguish their conduct
or the employer’s treatment of them for it.
See also, Versa v. Policy Studies, Inc., 45 S.W.3d 575 (Tenn. Ct. App. 2000).
Under this standard Ms. Chelton would be required to produce evidence that other
employees younger than herself and also under the supervision of Ms. Nowlin were not given a
change in job title even though the work they were performing would have merited such a change.
We do not find evidence in the record which would satisfy this requirement.
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Based upon the foregoing, we do not find that Ms. Chelton has produced sufficient evidence
to avoid summary judgment with respect to her claim that the reason proffered by Provident for
changing her job title was a pretext. However, we do find that she has created a genuine issue of
material fact as to whether the reason proffered by Provident for her termination was a pretext.
Provident maintains that Ms. Chelton was discharged because of poor job performance and
not because of her age. In its brief Provident asserts the following evidence which we construe as
being set forth in support of its argument that Ms. Chelton’s job performance was deficient:
1) “In October 1997, Ms. Nowlin found it necessary to create a ‘branding log’ to act as a to-
do list for Ms. Chelton, in order to ensure that she completed her job tasks in an efficient and timely
manner”
2) On April 16, 1998, Ms. McClanhan met with Ms Chelton to discuss a variety of issues
concerning her work and “noted that Ms. Chelton was ‘sarcastic and emotional,’ particularly in
reference to her supervisor (Ms. Nowlin). ... As a result of this meeting, Ms. McClanahan concluded
that there were some emotional control issues affecting Ms. Chelton’s ability to communicate with
other individuals in the workplace.”
3) “Ms. Nowlin sent a memorandum to Ms. Chelton on April 20, 1998, noting several
continued performance issues, including ‘difficulties with following direction and understanding
instructions,’ which ‘resulted in delays and non-productive use of resources within the Company.’”
4) “In October 1988, Ms. Chelton’s mid-year performance appraisal noted several ongoing
performance issues which continued to be of concern at the time of her subsequent appraisal in 1989.
... In an effort to resolve these problems, on March 28, 1989, Ms. Chelton’s supervisor, Dianna
Dupree, presented her with a written memorandum addressing these issues.... Ms. Dupree found it
necessary to draft a similar memorandum on April 25, 1990, further discussing these concerns.
Thus, Ms. Chelton’s allegation that her record was spotless until Ms. Nowlin became her supervisor
is without basis.”
5) “Ms. Nowlin testified in her deposition ... that Ms. Chelton ‘wasn’t performing her job,’
as ‘[t]he stock was running out, she wasn’t following up on the items that she needed to track, and
she didn’t recall meetings where she was assigned tasks.’... These problems, in turn, resulted in
complaints from sales personnel who did not have materials which Ms. Chelton was supposed to
keep in stock.”
Our assessment of the above statements is as follows.
Statements 1), 3) and 5) constitute assertions made by Ms. Nowlin and their value as
evidence that Ms. Chelton was performing poorly is, therefore, dependant upon Ms. Nowlin’s
credibility. In her affidavit filed in this case Ms. Chelton attests that she asked Ms. Nowlin why she
was being placed on probation and was advised by Ms. Nowlin that so many complaints had been
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received about her work that she had no choice. Ms. Chelton further attests, “When I pressed her
to tell me who had complained about my work, she stated that Darrell Johnson had complained and
that he had told her he could no longer work with me.” In her deposition, when Ms. Nowlin was
asked if she could remember the name of anyone who had complained about Ms. Chelton the only
name she could recall was that of Darrell Johnson. However, Mr. Johnson filed an affidavit in this
case wherein he states, “I have never complained to any member of management at Provident that
Karen Chelton was not doing her job, in fact, she always did an excellent job.” We find that Ms.
Chelton’s undisputed averment that Ms. Nowlin advised her that she was placed on probation
because of complaints by Mr. Johnson coupled with Mr. Johnson attestation that he did not complain
constitutes sufficient evidence to cause a jury to doubt Ms. Nowlin’s credibility. As noted by the
U.S. Supreme Court in Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 120 S. Ct. 2097(2000), “[i]n appropriate circumstances, a trier of fact can reasonably infer from the falsity of the
explanation that the employer is dissembling to cover up a discriminatory purpose.”
With respect to statement number 2) we do not find the assertion that Ms. Chelton was
“emotional and sarcastic” at the described meeting to be probative of poor job performance.
Provident states that Ms. McClanahan concluded that “there were some emotional control issues
affecting Ms. Chelton’s ability to communicate with other individuals in the workplace” The
apparent implication of this statement is that Ms. Chelton had emotional problems that affected her
job performance. It is our determination from reviewing the relevant portion of Ms. McClanahan’s
testimony referenced by Provident in support of this statement that a jury could reasonably reach a
contrary conclusion:
Q Did you feel like - - or did you terminate this meeting because of [Ms.
Chelton’s] inability to exhibit emotional control?
A No.
Q Did you feel like the emotional control issue with her got in the way of – by the
time the whole meeting was over that it had gotten in the way of communication
between the members of the meeting?
A Certainly.
Ms. McClanhan’s notes from the meeting referred to state that “PN and I met today with
KC”. Although Ms. McClanahan is not asked to identify PN, we assume that PN is Pamela Nowlin.
Thus, apparently, the only individuals at the meeting were Ms. McClanahan, Ms. Nowlin and Ms.
Chelton. Ms. McClanahan’s notes further indicate that Ms. Chelton was advised by Ms.
McClanahan of documents showing conversations regarding her performance problems and that Ms.
Chelton continuously questioned this documentation. Ms. McClanahan’s notes also indicate that
Ms. Nowlin’s “commun”(communication) was “not good; she was ‘coy’ - asking questions of KC
as tho she (PN) is an attorney rather than commun. directly; PN’s body language was forceful and
rigid.” It could be reasonably inferred from these notes that Ms. Chelton’s alleged display of
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emotion and sarcasm was her reaction to the manner in which she was being confronted in what she
perceived to be an unfair and baseless attack upon her job performance. There is no indication from
the referenced testimony that Ms. Chelton’s alleged behavior at this meeting negatively impacted
the performance of any of her duties as staff support technician or that she exhibited such behavior
outside the parameters of this particular meeting. A jury could reasonably conclude that this
testimony does not constitute evidence of poor job performance.
As to the statements shown at number 5) the record confirms that Ms. Chelton exhibited
some performance problems between 1988 and 1990 which were referenced in the designated
performance appraisals and memoranda. However, it is also true that, at the time these documents
were issued, Ms. Chelton was still performing the duties of an underwriter. Ms. Chelton
acknowledges that she did not perform well in that position, testifying that she did not receive proper
training. But she was not performing underwriting services in her position as staff support
technician. A jury could reasonably conclude that Ms. Chelton’s performance as an underwriter has
little or no relevance to her performance of a different job with different duties eight to ten years
later.
Ms. Chelton has submitted job appraisal reports from more recent years which evidence
favorable evaluations. Appraisal reports issued in 1994 and 1995 show that she met or exceeded
objectives in all areas. The 1994 report contains several favorable comments such as “She time and
again demonstrated her knowledge of our products and consistently met her deadlines.”and “Karen
works well with the staff in Corporate Communications, as has proven that she can develop and
complete a project in an efficient and timely manner. I look forward to her support in this area.”
The report issued in 1995 notes, “I look forward to the coming year, and Karen’s continued
contribution to Voluntary Benefits. We work in an exciting area of the division, and have the
opportunity to be very creative in our job. Karen will play a major part in our success!”
Ms. Chelton submits even more recent evidence of Provident’s evaluation of her performance
in the form of a report dated March 11, 1997. This evaluation report uses a number scale in which
numbers one thru five designate categories of performance quality. Under this scale “5" indicates
“outstanding”; “4" indicates “exceeds expectations”; “3" indicates “meets expectations”; “2"
indicates “below expectations” and “1" indicates “unsatisfactory.” Out of a total of twenty six
categories, Ms. Chelton was not rated unsatisfactory in any category, was rated “2-3" in two
categories and was rated either 3 or 4 in the remaining twenty four categories. In addition to this
report, there is the previously noted affidavit of Mr. Johnson, which is dated January 8, 2002,
wherein he attests that Ms. Chelton “always did an excellent job. ”
Based upon our above analysis of the evidence presented in this case we find that there is a
genuine issue of material fact as to whether the reason for Ms. Chelton’s termination proffered by
Provident is a pretext.
Provident questions the authority of Versa v. Policy Studies, Inc., 45 S.W.3d 575 (Tenn. Ct.
App. 2000), a case cited by Ms. Chelton in her brief with regard to the matter of pretext. Provident
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states that Ms. Chelton, relying on Versa, “avers that she can establish pretext by creating an
inference that the stated reason for her termination is false.”. Provident indicates that this Court cited
two cases in Versa as support for this proposition - Kline v. Tennessee Valley Authority, 128 F.3d
337 (6th Cir. 1997) and Anderson v. Baxter Healthcare Corp., 13 F.3d 11220 (7th Cir.). Provident
maintains that these two cases “have been partially disapproved” and “specifically limited” by the
U.S. Supreme Court in Reeves v. Sanderson Plumbing Prod.s, Inc., ibid.In Reeves the plaintiff alleged that he was discharged because of his age. At trial in district
court the plaintiff established a prima facie case of age discrimination. His employer then proffered
a legitimate reason for his termination and the plaintiff introduced rebuttal evidence to prove that
the employer’s proffered reason was a pretext. The jury found in favor of the plaintiff. However,
the Court of Appeals for the Fifth Circuit reversed finding that, although the plaintiff may have
presented sufficient evidence for the jury to find that the employer’s proffered reason for its action
was a pretext, it did not follow that the plaintiff had presented sufficient evidence to show that he
had been fired because of his age. On further appeal, the Supreme Court found that the Circuit Court
of Appeals had misconceived the evidentiary burden on the plaintiff by “proceed[ing] from the
assumption that a prima facie case of discrimination, combined with sufficient evidence for the trier
of fact to disbelieve the defendant’s legitimate, nondiscriminatory reason for its decision, is
insufficient as a matter of law to sustain a jury’s finding of intentional discrimination.”
Provident misconstrues Reeves. In Reeves the Court’ sole reference to Kline and Anderson
is to indicate that these cases stand for the proposition that a “prima facie case combined with
sufficient evidence to disbelieve [the] employer’s explanation always creates [a] jury issue of
whether [the] employer intentionally discriminated.” (emphasis added) The Court does not reference
either Kline or Anderson with respect to the proposition that a plaintiff “can establish pretext by
creating an inference that the stated reason for termination is false” We find nothing in Reeves to
show that it abrogates or disapproves of either case with respect to the latter proposition. In fact, as
noted by Provident, the Court in Reeves specifically states that “[i]n appropriate circumstances, the
trier of fact can reasonably infer from the falsity of the explanation that the employer is dissembling
to cover up a discriminatory purpose.”
Provident also evidently argues that, under Reeves, although a trier of fact may, in some
cases, find that an employer engaged in unlawful discrimination based upon its proffered explanation
having been discredited, such a finding is not appropriate in the instant case. Provident argues that
Ms. Chelton “has offered no evidence to demonstrate that age played a role in the decision to
terminate her employment in June 1998.” In support of this argument Provident asserts that Ms.
Chelton’s contention that she was subject to an adverse job action because of her age is based upon
her subjective impression rather than upon objective evidence. Accordingly, Provident argues that
Ms. Chelton has failed to meet her ultimate burden of proving that age played a role in Provident’s
decision to terminate her employment.
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The Court in Reeves stated as follows at page 2109 with respect to those cases where a prima
facie case plus sufficient evidence of the falsity of the employer’s proffered explanation would not
be enough to sustain a jury finding of liability:
... Thus, a plaintiff’s prima facie case, combined with sufficient evidence to find
that the employer’s asserted justification is false, may permit the trier of fact to
conclude that the employer unlawfully discriminated.
This is not to say that such a showing by the plaintiff will always be
adequate to sustain a jury’s finding of liability. Certainly there will be instances
where, although the plaintiff has established a prima facie case and set forth
sufficient evidence to reject the defendant’s explanation, no rational fact finder
could conclude that the action was discriminatory. For instance, an employer
would be entitled to judgment as a matter of law if the record conclusively
revealed some other, nondiscriminatory reason for the employer’s decision, or if
the plaintiff created only a weak issue of fact as to whether the employer’s reason
was untrue and there was abundant and uncontroverted independent evidence that
no discrimination had occurred. See Aka v. Washington Hospital Center, 156
F.3d, at 1291-1292; see also Fisher v. Vassar College, 114 F.3d, at 1338 (‘[I]f the
circumstances show that the defendant gave the false explanation to conceal
something other than discrimination, the inference of discrimination will be weak
or nonexistent’). (Emphasis in original.)
Although, admittedly, these examples are not exhaustive of all the circumstances which
would justify summary judgment for an employer despite proof of a prima facie case and proof
adequate to reject the employer’s proffered explanation, they do give an idea of the nature of case
in which a motion for summary judgment would survive such proof. We do not find that the case
before us is of that nature. We also note the concurring opinion of Justice Ginsburg in Reeves at page
2112 in this regard. Justice Ginsburg states that, under the Court’s holding that an employment
discrimination plaintiff may avoid summary judgment by submitting evidence establishing a prima
facie case and evidence from which a rational trier of fact could find that the employer’s proffered
explanation for its action was false,
...[i]t may be incumbent on the Court, in an appropriate case, to define more
precisely the circumstances in which the plaintiffs will be required to submit
evidence beyond these two categories in order to survive a motion for judgment
as a matter of law. I anticipate that such circumstances will be uncommon. As
the Court notes, it is a principle of evidence law that the jury is entitled to treat a
party’s dishonesty about a material fact as evidence of culpability. Ante, at 2108.
Under this commonsense principle, evidence suggesting that a defendant accused
of illegal discrimination has chosen to give a false explanation for its actions gives
rise to a rational inference that the defendant could be masking its actual, illegal
motivation. Ibid. Whether the defendant was in fact motivated by discrimination
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is of course for the finder of fact to decide; that is the lesson of St. Mary’s Honor
Center v. Hicks, 509 U.S. 502, 113 S.Ct. 2742, 125 L.Ed.2d 407 (1993). But the
inference remains - unless it is conclusively demonstrated, by evidence the district
court is required to credit on motion for judgment as a matter of law, see ante, at
2110-2111, that discrimination could not have been the defendant’s true
motivation. If such conclusive demonstrations are (as I suspect) atypical, it
follows that the ultimate question of liability ordinarily should not be taken from
the jury once the plaintiff has introduced the categories of evidence described
above.
It is our conclusion that Ms. Chelton has submitted sufficient evidence to establish a prima
facie case and to discredit Provident’s proffered explanation for her termination. Furthermore, we
find no evidence which conclusively demonstrates that discrimination could not have been
Provident’s true intention.
For the foregoing reasons the judgment of the Trial Court dismissing Ms. Chelton’s claim
for discrimination based upon her demotion and reduction in job points is affirmed; however, the
Trial Court’s judgment dismissing Ms. Chelton’s claim for discrimination based upon her
termination is vacated and the case is remanded for a trial of that claim on the merits. Costs of
appeal are adjudged equally against Karen Chelton and Provident.
_________________________________________
HOUSTON M. GODDARD, PRESIDING JUDGE
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