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Court: Out-of-state employees not covered by MHRA

The Missouri Human Rights Act does not extend to employees of Missouri-based companies who work outside of Missouri, the Missouri Supreme Court has ruled for the first time.

On Dec. 24, the court addressed the issue in a pair of cases.

In a 5-2 ruling, the court upheld the dismissal of an Illinois man’s lawsuit against Dobbs Tire & Auto Center Inc., a Missouri-based company.

In its majority opinion, written by Judge Zel M. Fischer, the court held that regardless of where the employer’s decisions took place, the employee at the center of the case, Dwight Tuttle, was aggrieved solely in Illinois, which precludes the application of the MHRA. Chief Justice George W. Draper III and Judge Laura Denvir Stith dissented.

In a separate ruling, the court quashed a preliminary writ of prohibition concerning a lower court’s decision overruling dismissal of an Iowa man’s age-discrimination and retaliation claims brought against his employer, Anheuser-Busch LLC, under the MHRA.

In that case, four judges held that the man, John Esser, could not invoke the protections of the MHRA as an Iowa resident and employee. In a separate opinion, Draper concurred with only the result of the opinion. Judges Patricia Breckenridge and Stith joined Draper.

With the writ quashed, the case returns to the circuit court, which must reconsider the motion to dismiss in light of the decision in Tuttle’s suit.

Out-of-state ‘adverse impact’

Tuttle was employed by Dobbs Tire from 1989 to March 2017. From 2003 to 2016, he served as the manager of the company’s store in Shiloh, Illinois.

He sued the company and its leaders in 2017 in St. Louis County Circuit Court, alleging age discrimination and retaliation.

The company filed a motion to dismiss the suit. Judge Michael T. Jamison granted the motion, prompting Tuttle’s appeal.

In the majority opinion, Fischer said Tuttle did not specify in his suit exactly where each alleged discriminatory action took place. He said Tuttle instead stated that some of the decisions and actions against him took place in Missouri.

Fischer said it is not an employer’s decision that gives rise to an MHRA claim, but rather being aggrieved by an unlawful discriminatory practice. He said Tuttle was not aggrieved until the alleged discriminatory practice resulted in an adverse impact, and that adverse impact occurred in Illinois.

“Tuttle does not dispute that the manner in which he was aggrieved is his loss of wages in Illinois, benefits of his employment in Illinois and mental anguish arising from his constructive discharge from his Illinois job,” he said. “Taking all of these allegations as true, all of the adverse impact alleged by Tuttle occurred in Illinois.”

Fischer said additional support for the majority’s opinion comes from the long-standing presumption that Missouri statutes apply only within the bounds of the state and have no extraterritorial effect.

In the dissent, Draper said he would hold that the decisions that occurred in Missouri would be actionable under the MHRA.

Additionally, Draper said the focus and purpose of the MHRA is to regulate Missouri employers’ conduct.

“Missouri’s corporate citizens should be held accountable for engaging in unlawful discriminatory practices that occur in Missouri and cause harm to their employees, even if they are in another state,” he said. “The principal opinion encourages Missouri employers to engage in unlawful discriminatory practices against its out-of-state employees with impunity, knowing their decision to engage in those insidious practices will not be actionable in Missouri.”

Esser is a resident of Urbandale, Iowa who has worked for Anheuser-Busch since 1983. In 2007, he became a retail sales director over a multistate sales territory, according to the majority opinion, also written by Fischer.

Esser sued the company in 2017 in St. Louis City Circuit Court, alleging age discrimination and retaliation. Anheuser-Busch filed a motion to dismiss, prompting Esser to amend his petition to include new allegations tied to Missouri.

Judge Joan L. Moriarty overruled the company’s second motion to dismiss. The Supreme Court granted a preliminary writ of prohibition after the Court of Appeals denied the company’s writ application.

As in Tuttle’s case, Fischer said, Esser did not suffer an adverse impact in Missouri and thus could not bring a claim under the MHRA.

In his dissent, Draper said he would quash the writ but allow Esser’s claims to proceed.

Jerome “Jerry” Dobson of Goldberg, Berns & Rich in St. Louis represented both plaintiffs. Dobbs Tire was represented by Robert D. Younger of McMahon Berger. Neither party could be reached for comment.

James F. Bennett of Dowd Bennett in St. Louis represented Anheuser-Busch. He deferred comment to a company spokesperson, who was unable to immediately provide a comment on the case.

The cases are Tuttle v. Dobbs Tire & Auto Centers Inc. et al., SC97721, and State ex rel. Anheuser-Busch LLC v. Moriarty, SC97845.