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Jury slaps AutoZone with $186 million verdict for pregnancy bias

published in McAfee & Taft EmployerLINC | August 17, 2015

By Nathan L. Whatley

Earlier this summer, a California jury awarded nearly $186 million – $800,000 in compensatory damages and $185 million in punitive damages – to a former AutoZone store manager who filed suit against the auto parts retailer for pregnancy bias. While this blockbuster award is likely to be reduced significantly on appeal, the verdict illustrates that jurors care about pregnancy discrimination cases and will respond strongly if they believe an employer has mistreated a pregnant employee.

Background

Rosario Juarez managed an AutoZone store in San Diego, California. Shortly after informing her supervisor that she was pregnant, she claimed she was persistently harassed into stepping down from her store manager position and was ultimately demoted, losing her bonuses and overtime pay. Following her return from maternity leave, Juarez filed a lawsuit over her demotion and was subsequently terminated, allegedly for stealing cash from the store. During the court proceedings, however, AutoZone’s loss prevention manager gave testimony that she was told to target Juarez specifically in investigating the missing money.

Jury sends strong message to AutoZone

The jury deliberated for less than two days before finding for the former store manager on all claims asserted, including that Juarez was the subject of severe and pervasive discrimination based on her pregnancy and gender and that high-ranking officers of the company were involved in the discriminatory actions. The jury awarded her nearly $800,000 in compensatory damages for past wages, future wages and emotional distress. In the punitive damages phase, however, the jury sent an even stronger message to AutoZone about its failure to prevent discrimination and its decision to retaliate against the plaintiff, awarding Juarez $185 million in punitive damages.

The takeaway for employers

While it is very unlikely that record-setting awards of this magnitude will be seen very often, missteps in working with pregnant employees can easily cost employers hundreds of thousands of dollars. The verdict against AutoZone shows that jurors of both genders are willing to punish employers whom they believe have acted egregiously toward their workers. Notably, the jury in the AutoZone case was comprised mostly of men.

Pregnancy discrimination has also recently received significant attention from the U.S. Equal Employment Opportunity Commission (EEOC). Last summer the EEOC issued an Enforcement Guidance on pregnancy discrimination which they further revised in June of this year. Two key issues in the latest revisions address evidence of pregnancy discrimination and providing light duty to pregnant employees. The EEOC states that evidence that an employer’s neutral policy places a burden on pregnant employees can be proof of pregnancy discrimination. With regard to light duty, the EEOC states that employers should provide pregnant employees with accommodations that the employer would provide to other, non-pregnant employees with similar ability or inability to work.

  • Rosario Juarez v. Auto Zone Stores, Inc., Case No. 08-CV-00417-WVG (U.S. District Court for the Southern District of California)