BEFORE THE IOWA CIVIL RIGHTS COMMISSION

CONNIE ZESCH- LUENSE, Complainant, and IOWA CIVIL RIGHTS COMMISSION,

vs.

ROBERT PLILEY and the CHICKEN HOUSE, Respondents.

CP # 05-88-17707

CONCLUSIONS OF LAW CONTINUED:

V. REMEDIES:

A. In General:

23. Violation of Iowa Code sections 601A.7 and 601A.11 (now 216.7 and 216.11) having been established the Commission has the duty to issue a cease and desist order and to carry out other necessary remedial action. Iowa Code S 216.15(8) (1993). In formulating these measures, the Commission does not merely provide a remedy for this specific dispute, but corrects broader patterns of behavior which constitute the practice of discrimination. Iron Workers Local No. 67 v. Hart, 191 N.W.2d 758, 770 (Iowa 1971). "An appropriate remedial order should close off 'untraveled roads' to the illicit end and not 'only the worn one.'" Id. at 771.

B. Compensatory Damages: Back Pay:

1. Purposes of Back Pay:

24.

77. The award of back pay . . . serves two purposes. First, "the reasonably certain prospect of a back pay award . . . provide[s] the spur or catalyst which causes employers and unions to self- examine and to self-evaluate their employment practices and to endeavor to eliminate [employment discrimination]." Albemarle Paper Company v. Moody, 422 U.S. 405, 418-19, 95 S.Ct. 2362, 2371-72, 45 L. Ed. 2d 280 (1975). Second, back pay serves to "make persons whole for injuries suffered on account of unlawful employment discrimination." Id. 422 U.S. at 419, 95 S.Ct. at 2372. Both of these purposes would be served by an award of back pay in the present case.

Maxine Boomgarden, slip. op. at 91.

2. Principles to Be Followed In Computing Back Pay:

25.

78. . . . [T]wo basic principles [are] to be followed in computing awards in discrimination cases: "First, an unrealistic exactitude is not required. Second, uncertainties in determining what an employee would have earned before the discrimination should be resolved against the employer." Hy-Vee Food Stores, Inc. v. Iowa Civil Rights Commission, 453 N.W.2d 512, 530-531 (Iowa 1990). "It suffices for the [agency] to determine the amount of back wages as a matter of just and reasonable inferences. Difficulty of ascertainment is no longer confused with right of recovery." Id. at 531.

Maxine Boomgarden, slip. op. at 91-92.

3. Ruling in the Alternative: Hire on a Trial Basis Is Not Determinative of Back Pay:

26. Complainant Zesch-Luense was not hired on a "trial basis." See Finding of Fact No. 51. Even if she had been, as suggested by Respondents, it would have affected neither a finding of liability nor back pay. The "trial basis" described by Respondents' witnesses basically corresponds to a normal employee at will relationship. See Finding of Fact No. 51. That is, in an "at will" relationship the employee can be terminated at any time for any lawful reason or for no reason. See e.g. Springer v. Weeks & Leo Co., Inc., 429 N.W.2d 558, 559-60 (Iowa 1988)(finding a damages remedy for at-will employees discharged for reasons violating a "clearly articulated public policy of the state"); Abrisz v. Pulley Freight Lines, Inc., 270 N.W.2d 454, 455 (Iowa 1978). Neither a probationary or other at will status is determinative of liability for discrimination in discharge cases. Schlei, Employment Discrimination Law 599 (1983). To require a probationary or trial basis employee to prove that she would have continued in employment beyond such a trial period would be contrary to the rule that "uncertainty in determining what the discriminatee would have earned but for discrimination is to be resolved against the defendants." Belton, Remedies in Employment Discrimination Law S 9.15 p. 318 (1992). See Hy-Vee Food Stores, Inc. v. Iowa Civil Rights Commission, 453 N.W.2d 512, 530-531 (Iowa 1990).

4. Complainant Has Established Proof of Back Pay:

27. The Commission has the authority to make awards of backpay. Iowa Code S 601A.15(8)(a)(1) (1989). In making such awards, interim earnings and unemployment compensation received during the backpay period are to be deducted. Id. The Complainant bears the burden of proof in establishing his or her damages. Diane Humburd, 10 Iowa Civil Rights Commission Case Rpts. 1, 9 (1989)(citing Poulsen v. Russell, 300 N.W.2d 289, 295 (Iowa 1981)). See Children's Home v. Cedar Rapids Civil Rights Commission, 464 N.W.2d 478, 481 (Iowa Ct. App. 1990). The Complainant may meet that burden of proof by establishing the gross backpay due for the period for which backpay is sought. Diane Humburd at 10 (citing e.g. EEOC v. Kallir, Phillips, Ross, Inc., 420 F. Supp. 919, 924 (S.D. N.Y. 1976), aff'd mem., 559 F.2d 1203 (2d Cir.), cert. denied, 434 U.S. 920 (1977)). This the Complainant has done. See Finding of Fact No. 53.

5. Respondents Have Failed To Establish Any Interim Earnings Or Failure to Mitigate Damages:

28. The burden of proof for establishing the interim earnings, including unemployment insurance payments, of the Complainant rests with the Respondent. Diane Humburd at 10 (citing Stauter v. Walnut Grove Products, 188 N.W.2d 305, 312 (Iowa 1973); EEOC v. Kallir, Phillips, Ross, Inc., 420 F. Supp. at 924)). The Respondent also bears the burden of proof for establishing any failure of the Complainant to mitigate damages. Children's Home of Cedar Rapids v. Cedar Rapids Civil Rights Commission, 464 N.W.2d 478, 481 (Iowa Ct. App. 1990). No interim earnings or failure to mitigate damages were established in this case. See Findings of Fact Nos. 52-53.

C. Compensatory Damages: Emotional Distress:

1. Legal Authority For and Purpose of Power to Award Damages for Emotional Distress:

29. In considering the question of emotional distress damages, it must be borne in mind that the Act is a "manifestation of a massive national drive to right wrongs prevailing in our social and economic structures for more than a century," Iron Workers Local No. 67 v. Hart, 191 N.W.2d 758, 765 (Iowa 1971).

30. Race discrimination in public accommodations and aiding and abetting, including retaliation, are serious matters. The Iowa Civil Rights Act was enacted, in part, to provide remedies for these acts. See Iowa Code SS 601A.7, .11 (now 216.7, .11), 216.15(8)(a)(8).

31. By 1978, it became clear to the legislature that the extremely limited remedies originally enacted in 1965 were woefully inadequate to carry out the remedial purposes of the act. Therefore, the act was amended, effective January 1, 1979, to give the Commission the power to award "actual damages." 1978 Iowa Acts ch. 1179 S 16. These are synonymous with "compensatory damages". The purpose of such authority is not to remedy only out-of-pocket losses while ignoring proven emotional distress damages, but to "make whole" the victims of discrimination for all losses suffered as a result of discrimination. See Iowa Code S 216.15(8)(a)(8)(1993); Hy Vee Food Stores, Inc. v. Iowa Civil Rights Commission, 453 N.W.2d 512, 525-26 (Iowa 1990); Chauffers, Teamsters, and Helpers v. Iowa Civil Rights Commission, 394 N.W.2d 375, 383 (Iowa 1986). "[T]he real purpose behind a civil rights award is to make the person whole for an injury suffered as a result of unlawful employment [or public accommodations] discrimination [or aiding and abetting]." Allison-Bristow v. Iowa Civil Rights Commission, 461 N.W.2d 456, 459 (Iowa 1990).

32. "[D]amages for emotional distress are recoverable under our civil rights statute." Hy Vee Food Stores, Inc. v. Iowa Civil Rights Commission, 453 N.W.2d 512, 525 (Iowa 1990). In 1986, the Iowa Supreme Court held:

We agree with those jurisdictions allowing the award of emotional distress damages by the civil rights commission or its equivalent. This result seems only natural because emotional distress is generally a compensable injury, and the language of the statute allows actual damages which are synonymous with compensatory damages. Allowing the award of emotional distress damages is also consistent with the commission's discretion in fashioning an appropriate remedy.

Chauffeurs, Teamsters and Helpers, Local Union No. 238 v. Iowa Civil Rights Commission, 394 N.W.2d 375, 383 (Iowa 1986). A victim of discrimination is to receive "a remedy for his or her complete injury," including damages for emotional distress. Hy-Vee at 525-26.

33. The Iowa Supreme Court's observations on the emotional distress damages resulting from wrongful discharge are equally applicable to the distress resulting from aiding and abetting or public accommodations discrimination:

[Such action] offends standards of fair conduct . . . the [victim of discrimination] may suffer mentally. "Humiliation, wounded pride and the like may cause very acute mental anguish." [citations omitted]. We know of no logical reason why . . . damages should be limited to out-of- pocket loss of income, when the [victim] also suffers causally connected emotional harm. . . . We believe that fairness alone justifies the allowance of a full recovery in this type of tort.

Niblo v. Parr Mfg. Co., 445 N.W.2d 351, 355 (Iowa 1989).

34. Other courts have also made observations which apply to this case:

Belton, Remedies in Employment Discrimination Law 408 (1992)(quoting Humphrey v. Southwestern Portland Cement Company, 369 F. Supp. 832, 834 (W.D. Tex. 1973).

35.

Id. (quoting Foster v. MCI Telecommunications Corp., 773 F.2d 1116, 1120 (10th Cir. 1985)(quoting Baskin v. Parker, 602 F.2d 1205, 1209 (5th Cir. 1979)).

2. "Humiliation," "Wounded Pride," "Anger", "Hurt" and "Upset" Are All Forms of Compensable Emotional Distress:

36. Among the many forms of emotional distress which may be compensated are "anger," "upset," "hurt," Kentucky Commission on Human Rights v. Fraser, 625 S.W.2d 852, 856 (Ky. 1981); 2 Kentucky Commission on Human Rights, Damages for Embarrassment and Humiliation in Discrimination Cases 24- 29 (1982)(citing Fraser and 121-129 Broadway Realty v. New York Division of Human Rights, 49 A.D.2d 422, 376 N.Y.S.2d 17 (1975)), "humiliation, wounded pride, and the like." Niblo v. Parr Mfg. Co., 445 N.W.2d at 355. Complainant Zesch- Luense suffered such distress. See Finding of Fact No. 54- 57.

3. Liberal Proof Requirements for Emotional Distress Are Consistent With the Requirement That The Statute Is To Be Liberally Construed to Effectuate Its Purpose:

37. Emotional distress damages must be proven. Blessum v. Howard County Board of Supervisors, 295 N.W.2d 836, 845 (Iowa 1980). These damages must be and have been proven here, as in any civil proceeding, by a preponderance or "greater weight" of the evidence and not by any more stringent standard. Iowa R. App. Pro. 14(f)(6).

38. Aiding or abetting and public accommodations discrimination violates:

Hy Vee Food Stores, Inc. v. Iowa Civil Rights Commission, 453 N.W.2d 512, 526 (Iowa 1990)(emphasis added).

4. Emotional Distress Caused by Discrimination is to Be Compensated:

39. The emotional distress sustained by the Complainant is substantial. Since even mild emotional distress resulting from discrimination is to be compensated, it is obvious that compensation must be awarded here. Rachel Helkenn, 10 Iowa Civil Rights Commission Case Reports 62, 73 (1990); Robert E. Swanson, 10 Iowa Civil Rights Commission Case Reports 36, 45 (1989); Ann Redies, 10 Iowa Civil Rights Commission Case Reports 17, 28 (1989). See Hy Vee Food Stores, Inc. v. Iowa Civil Rights Commission, 453 N.W.2d 512, 525-26 (Iowa 1990)(citing Niblo v. Parr Mfg., Inc., 445 N.W.2d 351, 355 (Iowa 1989)(adopting reasoning that because public policy requires that employee who is victim of discrimination is to be given a remedy for his complete injury, employee need not show distress is severe in order to be compensated for it)).

5. Emotional Distress May Be Proven By Either Testimony of A Complainant Alone or Supported By the Testimony of a Spouse:

40. "The [complainants'] own testimony [in this case is] solely sufficient to establish humiliation or mental distress." Williams v. TransWorld Airlines, Inc., 660 F.2d 1267, 1273, 27 Fair Empl. Prac. Cases 487, 491 (8th Cir. 1981). See also Crumble v. Blumthal, 549 F.2d 462, 467 (7th Cir. 1977); Smith v. Anchor Building Corp., 536 F.2d 231, 236 (8th Cir. 1976); Phillips v. Butler, 3 Eq. Opp. Hous. Cas. § 15388 (N.D. Ill. 1981); Belton, Remedies in Employment Discrimination Law 415 (1992). Of course, testimony of a complainant's spouse or ex-spouse may also be supportive of a finding of emotional distress, as it is here for Complainant Zesch-Luense. See Blessum v. Howard County Board of Supervisors, 295 N.W.2d 836, 845 (Iowa 1980).

6. Evidence of Crying In This Case Helps Establish Emotional Distress. Such Damages Can Be Awarded In the Absence of Evidence of Economic Loss or Physical or Mental Impairment:

41. In discrimination cases, an award of damages for emotional distress can be made in the absence of "evidence of economic or financial loss, or medical evidence of mental or emotional impairment." Seaton v. Sky Realty, 491 F.2d 634, 636 (7th Cir. 1974). Nonetheless, the evidence of crying in this case, by the Complainant, may be considered when assessing the existence or extent of emotional distress. See Blessum v. Howard County Board of Supervisors, 295 N.W.2d 836, 845 (Iowa 1980); Fellows v. Iowa Civil Rights Commission, 236 N.W.2d 671, 676 (Iowa Ct. App. 1988). See Findings of Fact Nos. 55-56.

7. Determining the Amount of Damages for Emotional Distress:

42.

2 Kentucky Commission on Human Rights, Damages for Embarrassment and Humiliation in Discrimination Cases 24-29 (1982)(quoting Randall v. Cowlitz Amusements, 76 P.2d 1017 (Wash. 1938)).

43. Although awards in other cases have little value in determining the amount an award should be in another specific case, Lynch v. City of Des Moines, 454 N.W.2d 827, 836-37 (Iowa 1990), there are many examples of such awards, ranging from $500 to $150,000, for emotional distress in discrimination cases. See e.g. Belton, Remedies in Employment Discrimination Law 416 n.78 (1992)(listing awards in 19 cases; 17 of which were for $10,000 or over). The Iowa District Court for Polk County recently awarded eighty thousand dollars ($80,000) to a sex discrimination plaintiff for emotional distress. Pamela Farren v. Super Valu Stores, Inc., Law No. Cl100-57791, slip op. at 22 (Polk Co. Dist. Ct. March 4, 1994). While any award should be tailored to the particular case, one commentator has noted that "a $750 award for mental distress is 'chump change.' Awards must be made which are large enough to compensate the victim of discrimination adequately for the injury suffered." 2 Kentucky Commission on Human Rights, Damages for Embarrassment and Humiliation in Discrimination Cases 60-61 (1982).

44. Like back pay, the reasonably certain prospect of an emotional distress damages award, when such damages are proven, serves to encourage employers and the public accommodations to evaluate their own operations to ensure they are lawful and nondiscriminatory. The consistent failure to award such proven damages will remove this incentive and may encourage discriminatory practices. See id. at 61. Cf. Albemarle Paper Company v. Moody, 422 U.S. 405, 418-19, 95 S.Ct. 2362, 2371-72, 45 L. Ed. 2d 280 (1975)(back pay).

45.

45. The two primary determinants of the amount awarded for damages for emotional distress are the severity of the distress and the duration of the distress. Bean v. Best, 93 N.W.2d 403, 408 (S.D. 1958)(citing Restatement of Torts § 905). "'In determining this, all relevant circumstances are considered, including sex, age, condition of life, and any other fact indicating the susceptibility of the injured person to this type of harm.' And continuing 'The extent and duration of emotional distress produced by the tortious conduct depend upon the sensitiveness of the injured person.'" Id. (quoting Restatement of Torts S 905). [See also Restatement (Second) of Torts S 905 (comment i).]

Dorene Polton, 10 Iowa Civil Rights Commission Case Reports 152, 166 (1992).

D. Attorney's Fees:

46. The Complainant having prevailed, she is entitled to an award of reasonable attorney's fees. Iowa Code § 216.15(8)(1993). If the parties cannot stipulate to the amount of these fees, they should be determined at a separate hearing. Ayala v. Center Line, Inc., 415 N.W.2d 603, 606 (Iowa 1987). The Commission must expressly retain jurisdiction of the case in order to determine the actual amount of attorney's fees to which Complainant is entitled to under this order and to enter a subsequent order awarding these fees. City of Des Moines Police Department v. Iowa Civil Rights Commission, 343 N.W.2d 836, 839 (Iowa 1984).

E. Hearing Costs:

47. The Commission has requested the assessment of hearing costs to Respondents. (Commission's Brief at 16). An administrative rule of the Iowa Civil Rights Commission provides, in relevant part, that: "If the complainant or the commission prevails in the hearing, the respondent shall pay the 'contested case costs' incurred by the commission." 161 IAC 4.7(1). "Contested case costs" include only:

a. The daily charge of the court reporter for attending and transcribing the hearing.

b. All mileage charges of the court reporter for traveling to and from the hearing.

c. All travel time charges of the court reporter for traveling to and from the hearing.

d. The cost of the original of the transcripts of the hearing.

e. Postage incurred by the administrative law judge in sending by mail (regular or certified) any papers which are made part of the record.

161 IAC 4.7(3).

48. Since the Commission and the complainant have prevailed in this case, an order awarding contested case costs is appropriate. The record should be held open so a bill of costs may be submitted after this decision becomes final. See Tammy R. Collins, CP # 09-91-21524, 09-91-21525, slip op. (Iowa Civil Rights Commission June 24, 1994)(Final Order adopting modifications, including assessment of hearing costs, set forth in Exceptions to the Proposed Decision and Order).