Is it unlawful for employers to care about employees? On June 10, 2002 a unanimous Supreme Court said “no.” At issue in Chevron U.S.A. Inc. v. Echazabal was whether the Equal Employment Opportunity Commission’s (EEOC) regulation allowing an employer to refuse to hire a person on the grounds that his or her performance of the job would endanger his or her own health is permissible under the Americans with Disabilities Act (ADA). The Supreme Court answered affirmatively, upholding the EEOC’s regulation that recognizes the “threat to self” defense. To come within the ambit of this regulation, an employer must show that the threat to the individual’s health is based on a reasonable medical judgment that relies on the most current medical knowledge and/or the best available objective evidence. The Chevron decision is important for employers because although the ADA specifically allows employers to refuse to hire a person whose disability presents a direct threat to others, it is silent on whether employers may refuse to hire someone whose disability would present a direct threat to him or herself.

The plaintiff, Mario Echazabal, worked for various independent contractors from 1972-1992 at Chevron’s oil refinery in El Segundo, California. He twice applied for a job directly with Chevron. On both occasions Chevron determined that Echazabal was qualified for the job and extended him a conditional offer of employment contingent on his passing a preemployment physical examination. Each time the examination revealed that Echazabal suffered from an uncorrectable liver abnormality (later identified as asymptomatic Hepatitis C virus). Chevron’s physicians concluded that to avoid further liver damage, Echazabal should not be exposed to solvents or other liver-toxic chemicals at Chevron’s refinery that could be fatal to him. Consequently, in each instance, Chevron’s human resources manager withdrew Echazabal’s offer of employment. The second time the human resources manager also asked Echazabal’s employer to either reassign him to a job without harmful chemicals or remove him from its refinery. Echazabal was laid off in 1996. In 1997 he sued Chevron alleging that it violated, among other laws, the ADA in refusing to hire him.

Under the ADA, employers may determine not to hire an applicant because they are not qualified for the position based upon results of a post-offer, pre-employment medical examination. Employers can defend these decisions based on qualification standards that tend to screen out people with disabilities when the qualifications standards are “job-related” and “consistent with business necessity.” 42 U.S.C. § 12113. Those qualification standards may include a requirement that an individual “not pose a direct threat to the health or safety of other individuals in the workplace” if the individual cannot perform the job safely with reasonable accommodation. 42 U.S.C. § 12113. The ADA defines “direct threat” as “a significant risk to the health or safety of others that cannot be eliminated by reasonable accommodation.” 42 U.S.C. § 12111(3). By regulation, the EEOC expanded the direct threat defense one step further, allowing an employer to screen out a potential worker with a disability not only for risks that he or she poses to others in the workplace but for risks on the job to his or her own health or safety as well. 29 C.F.R. § 1630.15(b)(2).

In this case, Echazabal suffered from asymptomatic hepatitis and did not pose a threat to others in the workplace. Chevron’s concerns about hiring Echazabal were to avoid time lost to sickness, excessive turnover from medical retirement or death, litigation under state tort law, and the risk of violating the Occupational Safety and Health Act of 1970 (OSHA), which mandates that every employer furnish to each employee “employment and a place of employment which are free from recognized hazards that are causing or are likely to cause death or serious physical harm to [its] employees.” The Supreme Court determined that Chevron’s concerns with respect to OSHA violations were “enough to show that the [EEOC’s] regulation is entitled to survive.” Thus, the Chevron decision reaffirms the employer’s right to conclude that a disabled applicant is not qualified for a job on the basis of a medical exam if, based on criteria that are job-related and consistent with business necessity, the job presents a danger to the applicant’s own safety, even if that individual poses no threat to other individuals in the workplace.

If you have any questions regarding the issues raised in this alert or would like assistance with labor matters, please contact Edward Trevvett or Israel Kornstein at (800) 685-1429 or the Harris Beach attorney with whom you usually work.

This legal alert provides brief analysis or comments on matters of labor law. This legal alert does not purport to be a substitute for advice of counsel on specific matters.