Statute of Limitations Starts Running Before Constructive Discharge

In Green v. Donahoe, No. 13-1096, 2014 U.S. App. LEXIS 14290, 2014 WL 3703823 (10th Cir. July 28, 2014), a panel of the 10th circuit, Judge Hartz writing, held that a claim for constructive discharge does not accrue at the time when plaintiff resigns.  Instead, the claim accrues on the date of the employer’s last misconduct.  In Green the plaintiff, a postal employee, agreed to resign his employment on December 16, 2009, but was permitted to use accrued annual and sick leave until March 31, 2010, at which point he could choose either to retire or accept a significantly lower position at a facility some 300 miles distant.  Plaintiff filed an informal charge of retaliation with an EEO counselor on January 7, 2010, but did not file a formal charge until February 17, 2010. On February 9, 2010, plaintiff notified his employer that he planned to retire, pursuant to their earlier agreement, effective March 31, 2010.  Plaintiff initiated EEO counseling on March 22, and filed another formal charge of retaliation on April 23, alleging constructive discharge for his forced retirement.  Plaintiff’s eventual lawsuit was dismissed when the district court held that it was untimely because plaintiff had not contacted an EEO counselor about it within 45 days.

In reviewing the lower court’s decision, the Tenth Circuit first examined the nature of a constructive discharge claim.  The Court explained that “c]onstructive discharge occurs when an employer unlawfully creates working conditions so intolerable that a reasonable person in the employee’s position would feel forced to resign.”  Green, 2014 U.S. App. LEXIS 14290 at *19, quoting Lockheed Martin Corp. v. Admin. Review Bd., 717 F.3d 1121, 1133 (10th Cir. 2013).  The key issue before the court was when the constructive discharge claim accrued.  The Court framed its analysis by noting that “[f]or most federal limitations periods, the clock starts running when the plaintiff first knew or should have known of his injury.”  Green, 2014 U.S. App. LEXIS 14290 at *22 (internal quotations omitted).  In the employment context, this generally means that the claim accrues when the “disputed employment practice” occurs.  Id. (internal quotations omitted). 

However, the Tenth Circuit found this general rule to be inappropriate in the context of constructive discharge claims.  The Tenth Circuit distinguished constructive discharges from other adverse actions, stating “[a] constructive discharge involves both an employee’s decision to leave and [the employer’s] precipitating conduct.”  Id. (emphasis in original) (alterations in original) (quotations omitted). 

The Tenth Circuit went on to identify the core question for resolution – whether the date of the accrual of plaintiff’s constructive discharge claim “can be postponed from the date of the employer’s misconduct until the employee quits or announces his future departure.”  Id. at *22.  The Court framed this question as a choice between accrual at the time when the “employee quits or announces his future departure” and when the last “discriminatory act” occurs.  As an initial matter, the Court noted that most courts to consider this issue had “no occasion” to choose between these approaches.  See, e.g., Jeffery v. City of Nashua, 163 N.H. 683, 48 A.3d 931, 936 (N.H. 2012) (plaintiff unsuccessfully argued that claim accrued on effective date of resignation, not when she gave notice of resignation); Patterson v. Idaho Dept. of Health & Welfare, 151 Idaho 310, 256 P.3d 718, 725 (Idaho 2011) (same); Whye v. City Council, 278 Kan. 458, 102 P.3d 384, 387 (Kan. 2004) (same); Hancock v. Bureau of Nat'l Affairs, Inc., 645 A.2d 588, 590 (D.C. 1994) (same)  However, the Court did identify “several” decisions holding that the claim accrued on the date of the resignation, on the rationale that the resignation was a “distinct discriminatory act”.  See Flaherty v. Metromail Corp., 235 F.3d 133, 138 (2d Cir. 2000); Draper v. Coeur Rochester, Inc., 147 F.3d 1104, 1111 (9th Cir. 1998); Young v. Nat'l Center for Health Servs. Research, 828 F.2d 235, 237-38 (4th Cir. 1987). 

The Court rejected that approach.  Declaring that “we cannot endorse the legal fiction that the employee's resignation, or notice of resignation, is a ‘discriminatory act’ of the employer”, the Court sided with the Seventh and D.C. Circuits in holding that a claim for constructive discharge must be filed such that there is at least one “discriminatory act” by the employer within the statutory limitations period.  See Mayers v. Laborers' Health & Safety Fund, 478 F.3d 364, 367, 370, 375 U.S. App. D.C. 134 (D.C. Cir. 2007) (notice of resignation was within limitations period but no discriminatory act of employer was); Davidson v. Ind.-Am. Water Works, 953 F.2d 1058, 1059-60 (7th Cir. 1992) (same).  In so holding, the Court reasoned that “delaying accrual past the date of the last discriminatory act and setting it at the date of notice of resignation would run counter to an essential feature of limitations periods by allowing the employee to extend the date of accrual indefinitely.”  Green, 2014 U.S. App. LEXIS 14290 at *25 to *26. 

This leaves us with three distinct approaches to the accrual of constructive discharge claims for limitations purposes:

1)     The limitations period runs from the date on which the employee provides notice of her resignation.  This is the approach adopted by the Second, Fourth, and Ninth Circuits.

2)     The limitations period runs from the date of the final discriminatory act, which cannot be the employee’s resignation.  This is the approach adopted by the Seventh, Tenth, and D.C. Circuits.

3)     The limitations period runs from the date on which the employee actually ceases to work for the employer.  This appears to be a minority position, but has been endorsed, for example, by the Court of Appeals for Oregon.  See Hernandez-Nolt v. Wash. Cnty., 315 P.3d 428 (Ore. App. 2013).

Please be sure to visit our website at http://RobertBFitzpatrick.com