The United States Court of Appeals for the Seventh Circuit has rejected the Equal Employment Opportunity Commission’s appeal seeking to overturn the trial court’s decision that Walmart did not violate the Pregnancy Discrimination Act when it accommodated all workers injured on the job, but denied all pregnant women a similar accommodation. EEOC v. Wal-Mart Stores East, LP, 7th Cir., No. 21-01690.

From 2014-2017, Walmart had a light duty accommodations policy for workers injured on the job. Walmart’s policy was pregnancy-neutral – eligibility depended on whether the employee suffered an injury at work. Walmart denied light duty accommodation requests under the policy to all employees injured off the job in order to, among other things, help reduce its costs and exposure under state workers’ compensation law.

Affirming the grant of summary judgment to Walmart, the appeals court held the company acted in line with Young v. United Parcel Service Inc., 575 U.S. 206 (2015), a 2015 U.S. Supreme Court decision that laid out a three-step test for assessing pregnancy accommodation claims. At step one, the employee must show that her employer refused her request for an accommodation, and then granted accommodations to others with similar restrictions. For step two, the employer must offer evidence to demonstrate its reasons for refusing the employee’s request were legitimate. At step three, the employee must “provid[e] sufficient evidence that the employer’s policies impose a significant burden on pregnant workers, and that the employer’s ‘legitimate, nondiscriminatory’ reasons are not sufficiently strong to justify the burden, but rather – when considered along with the burden imposed – give rise to an inference of intentional discrimination.” 575 U.S. at 229.

In its appeal, the EEOC urged that claims made under the Pregnancy Discrimination Act warrant broader discovery to learn “whether the employer explained why it excluded pregnant employees from a benefit.” The Seventh Circuit disagreed, holding that Walmart provided an adequate justification – compliance with state workers’ compensation requirements – to demonstrate its reasons for refusing the employee’s request were legitimate and nondiscriminatory.

The decision, found here, is binding in Illinois, Indiana and Wisconsin, and reinforces that all employers should carefully consider their policies and practices, to ensure that they take into account all relevant factors and comport with the three step test when responding to pregnant employees’ requests for accommodation. Ballard Spahr regularly consults with our clients on these matters.