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Cosmetics company loses face in discrimination claim.

In a case grappling with the emerging issue of worker classification, a Texas jury has found that an independent contractor deserves the same legal protections as a fulltime employee.

Although the plaintiff was classified as a contractor and filed her taxes accordingly, her lawyer persuaded the jury that the plaintiffs work for Mary Kay, Inc.--a cosmetics-sales company--made her a "superemployee" who was covered by antidiscrimination laws.

Mary Kay sales director Claudine Woolf, who lived and worked in California, claimed that the company failed to accommodate her disability under the state's Fair Employment and Housing Act. After a change of venue to Dallas, the location of Mary Kay headquarters, a jury found the company liable for disability and pregnancy discrimination and infliction of emotional distress. (Woolf v. Mary Kay, Inc., No. 00-5612-J (Tex., Dallas County Dist. Ct. Nov. 21,2002).)

As a sales director, Woolf oversaw dozens of sales recruits and was responsible for buying Mary Kay products and distributing them to her sales force. In March 1997, she was diagnosed with a virulent form of breast cancer. The same week, she found out she was pregnant. As both her pregnancy and her cancer progressed, Woolf became less productive and was unable to meet her sales quotas.

Woolf's requests for leniency from Mary Kay were rebuffed; her company car was towed in October, and she was informed that if she did not make her quota by November 30, she would lose her directorship. She was demoted and resigned, then filed suit, claiming she had been constructively terminated.

Angela Alioto, a San Francisco attorney who represented Woolf, was concerned that the Dallas venue might be hostile territory. But she said she knew the case was in better shape than she'd feared when she realized that most of the 10 women jurors wore slacks. (Mary Kay policy prohibits employees from wearing pants.)

Indeed, it was Mary Kay's hold over its contractors that helped Alioto convince the jury that classifying Woolf as an independent contractor was unreasonable. For example, another sales director testified that, as a representative of Mary Kay, she was expected to wear her uniform everywhere--including to, say, the corner store.

Alioto also argued that the independent status of Mary Kay's 900,000-plus sales contractors is a significant financial benefit for the company; Mary Kay is not obligated to provide them benefits, for example.

Representatives of the firm, testifying for the defense, said salespeople were allowed one to two months to correct their sales losses if they fell ill, and the company provided a list of such employees for a random month. Many of those employees, like Woolf, had cancer. Alioto contrasted the money Mary Kay saved by denying its employees medical leave with its demand that they continue producing--despite their illnesses.

Further, a Mary Kay witness admitted, under cross-examination, that evidence the company produced to show it had offered Woolf a second chance in December 1997 had been falsified, which supported Woolfs claim that the company had acted with malice.

The jury awarded Woolf compensatory and punitive damages. Last month, Mary Kay, Inc., filed a motion requesting a judgment notwithstanding the verdict.
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Title Annotation:texas
Author:Tischler, Eric
Date:Mar 1, 2003
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