We're finishing up our discussion of a decision handed down recently by the 5th U.S. Circuit Court of Appeals. (Georgia is in the 11th Circuit.) The plaintiff had been offered a job, only to have the offer rescinded when the company discovered she had declared Chapter 13 bankruptcy a year earlier. The plaintiff contends that the Bankruptcy Code bars this kind of discrimination. This court agrees with lower courts that it does not.

The statute, 11 U.S.C. ยง 525, has two subsections pertinent to this case: subd. (a) prohibits government employers from discriminating against "bankrupts;" subd. (b) prohibits discrimination by private companies. The problem for the court -- and the plaintiff -- is that the prohibited discriminatory actions aren't described in the same terms.

Remember, a court has to follow rules of statutory construction. One rule is that the statute must be read as a whole. Another is that Congress always means exactly what it says. If a term is included in section a and excluded in section b, it's not by mistake.

The court looked to subd. (a) and the phrase "deny employment to." It doesn't match subd. (b)'s "terminate employment" or "discriminate with respect to employment." The court looked at this and, following the rules of construction, determined that Congress meant to leave "deny employment to" out of subd. (b).

The plaintiff had claimed that "discriminate with respect to employment" included denying employment. The court says no. First, if it did, the "deny employment" language in subd. (a) would be superfluous -- and Congress only says what it means.

Second, both subd. (a) and subd. (b) include the phrase "terminate the employment." If the language in subd. (b) -- "discriminate with respect to employment" -- included hiring, it would make sense that it would also include firing, according to the court. And, again, Congress wouldn't include anything it didn't mean to. The terminate language would be redundant.

These rules seem inflexible, and in some cases they are. But, as the court points out, if Congress didn't mean this, if they thought that discrimination in hiring would be included in subd. (b), it's their responsibility to change it. You don't like the law you wrote? Write another one.

Sadly, this won't help the plaintiff.

Sources:

Westlaw News & Insight, "Appeals court rules against job seekers who file for bankruptcy," 3/09/2011

Burnett v. Stewart Title, --- F.3d ----, 2011 WL 754152 (C.A.5 (Tex.)), (page unavailable online) via Westlaw