Why it matters

As the employer provided a legitimate, nondiscriminatory reason for her termination, the U.S. Court of Appeals, Eighth Circuit affirmed dismissal of a plaintiff’s state and federal retaliation and discrimination claims. An executive housekeeper at the Millennium Hotel in Minneapolis, Isis Naguib, had run the department since 1977, overseeing 50 housekeepers and managing payroll. When she was terminated shortly after returning from Family and Medical Leave Act (FMLA) leave, she filed suit against the company, alleging she was discriminated and retaliated against because of her age, for taking FMLA leave and for opposing discriminatory practices. In response, the hotel told the court the plaintiff was fired when an internal investigation revealed Naguib had been overseeing a scheme of rounding down the hours of housekeepers to avoid paying overtime and in turn triggering a bonus that she was eligible to receive for minimizing payroll. Affirming the district court’s grant of summary judgment in favor of the employer, the Eighth Circuit found that even assuming the plaintiff had presented a prima facie case, the hotel had clearly shown a legitimate, nondiscriminatory reason for her termination.

Detailed discussion

From 1977 through 2014, Isis Naguib ran the housekeeping department at the Millennium Hotel in Minneapolis. She oversaw about 50 housekeepers and managed payroll for the department. Millennium tracked its employee hours using a punch clock system. However, Naguib also required housekeepers to handwrite their hours on a sign-in sheet.

Several housekeepers later reported that Naguib told them they were not allowed to list any overtime hours on the handwritten sheet; instead, they were directed to write in eight-hour shifts rather than the same hours reflected in the punch clock system. Naguib then manually overrode punch clock times and entered the shifts reflected on the handwritten sheets. Naguib’s contract with Millennium included an annual 1 percent bonus tied to minimizing employee payroll.

After Naguib was terminated in 2014, she alleged the hotel discriminated and retaliated against her. She cited several incidents as the basis for these claims, including her testimony in a 2011 deposition that a manager instructed her to use a different cleaning standard than the hotel actually used. That manager sent an email to his replacement asking whether she was “taking control” of Naguib, and the replacement manager once said to Naguib, “You’ll probably never retire, we’ll be carrying you out … in a box.” Naguib also claimed that the new manager asked her to tell Muslim employees to get notes from their mosques saying they were required to wear headscarves to work, but she refused.

In 2014, Naguib was instructed that she needed to use up her vacation hours or lose them. She took time off as a result and then requested—and was granted—Family and Medical Leave Act (FMLA) leave. When Naguib returned to work, she was suspended and then fired. She pointed to the various incidents and her FMLA leave as the basis for her termination, which she said was really motivated by her age and her taking FMLA leave, and was in retaliation for her opposition to discriminatory practices.

Millennium told a different story. During Naguib’s vacation days and FMLA leave in 2014, the employee who filled in at her position observed the timekeeping irregularities and reached out to management. As a result, Millennium launched a hotelwide investigation and learned that Naguib had instructed the housekeepers not to list their overtime hours on the handwritten sign-in sheet. The investigation also found that housekeeping had by far the most punch time edits of any department in the hotel.

A district court judge granted the employer’s motion for summary judgment, holding that Millennium had a legitimate, nonretaliatory and nondiscriminatory reason for firing Naguib that was not pretextual. Naguib appealed.

The U.S. Court of Appeals, Seventh Circuit agreed with the district court. Naguib failed to provide direct evidence that she was retaliated or discriminated against, the court said. Her deposition testimony took place in 2011, at which time the manager who had disagreed with her was no longer her boss; her allegation about being asked to obtain notes from Muslim employees was denied by the manager, and no such policy ever existed at the hotel.

Without direct evidence, Naguib’s claims must proceed under the McDonnell-Douglas burden-shifting framework, the court said. “Even assuming Naguib can establish a prima facie case of retaliation under that standard, Millennium has clearly shown a legitimate non-discriminatory or [non-]retaliatory reason for firing her. Millennium’s internal investigation credibly exposed that Naguib regularly altered employee hours without using a company-sanctioned form.”

The timing of Naguib’s termination supported the notion that it was not retaliatory, the panel added. Only when she took vacation did someone else fill in Naguib’s role, allowing the hotel to discover the time sheet practice Naguib oversaw.

“Within one month, and after a hotel-wide internal wage and hour investigation, Millennium fired Naguib. The investigation that resulted in Naguib’s termination also resulted in discipline for three other managers at Millennium who engaged in similar conduct on a smaller scale. Millennium then compensated its employees for unpaid overtime discovered in the investigation. Naguib has not met her burden to demonstrate that Millennium’s state[d] reasons for firing her were pretextual because she has not discredited Millennium’s version of events.”

After affirming summary judgment on Naguib’s retaliation claims, the court came to the same conclusion on her age discrimination and FMLA retaliation claims as well.

To read the opinion in Naguib v. Trimark Hotel Corp., click here.