No reasonable business necessity

(Part I)

Because of the absence of any express prohibition on marital discrimination in our jurisdiction, cases still arise regarding the no spouse employment policy of some companies. So far, the legislation on the matter only prohibits employer from requiring as a condition of employment or continuation of employment that a woman employee shall not get married, or to stipulate expressly or tacitly, that upon getting married, a woman employee shall be deemed resigned or separated (Article 136 Labor Code). Thus in the case of PT&T vs. NLRC G.R. 118978, May 23, 1997, the dismissal of a woman employee who contracted marriage was declared illegal. But in a later case of Duncan etc. & Tecson vs. Glaxo Wellcome, G.R. 162994, September 17, 2004, the dismissal of an employee of a pharmaceutical company who married an employee of a competitor company was held valid.

The latest case on the matter is that of Ronnie and Wilma, regular employees of a Paper Manufacturing Company (SPC) which requires the resignation of one of the two employees (male or female) who decides to get married in order to preserve an existing company policy of "no-employment-for-relatives-within-the-third-degree".

Ronnie was employed by SPC on October 27, 1993 as a Sheeting Machine Operator. In the course of his employment he met Alona, then an employee of the repacking section. Their friendship blossomed into romance that culminated in marriage on June 27, 1998. But prior to their marriage, the company management advised the couple that should they decide to get married, one of them should resign pursuant to the said company policy. Thus one week before their altar date, Ronnie had to quit and to sign a Release and Confirmation Agreement releasing SPC from any claim or demand.

Wilma, on the other hand was hired by SPC on February 5, 1997 as a Production Helper in the Selecting Department. There she met Dick, a helper in the cutter machine. They also fell in love with each other and got married on June 1, 2000. When management called their attention to the same company policy of two employees getting married, Wilma also had to resign on June 30, 2000 and to sign the same release agreement.

Subsequently however, both Ronnie and Wilma filed a complaint against SPC before the NLRC for unfair labor practice, constructive dismissal, separation pay and attorney’s fees. They averred among others, that the aforementioned company policy is illegal and contravenes Article 136 of the Labor Code.

SPC on the other hand argues that its policy does not violate Article 136. It is only intended to carry out its no employment for relatives within the third degree policy which is within the ambit of its management prerogative. The rule does not require a woman employee to resign. The employee spouses have the right to choose who between them should resign. Further they are free to marry persons other than co-employees. Hence it is not the marital status of the employee per se that is being discriminated, the SPC concluded. Was SPC correct?

No. With more women entering the workforce, employers are also enacting employment policies specifically prohibiting spouses from working for the same company. Two types of employment policies involve spouses: policies banning only spouses from working in the same company (no-spouse employment policies), and those banning immediate family members, including spouses, from working in the same company (anti-nepotism employment policies).

In challenging the anti-nepotism employment policies in the United States, complainants utilize two theories of employment discrimination: the disparate treatment and the disparate impact. Under the disparate treatment analysis, this plaintiff must prove that an employment policy is discriminatory on its face. No-spouse employment policies requiring an employee of a particular sex to either quit, transfer, or be fired are facially discriminatory. For example, an employment policy prohibiting the employer from hiring wives of male employees, but not husbands of female employees, is discriminatory on its face.

On the other hand, to establish disparate impact, the complainants must prove that a facially neutral policy has a disproportionate effect on a particular class. For example, although most employment policies do not expressly indicate which spouse will be required to transfer or leave the company, the policy often disproportionately affects one sex.

The state court’s rulings on the issue depend on their interpretation of the scope of marital status discrimination within the meaning of their respective civil rights acts. The courts narrowly interpreting marital status hold that the relevant inquiry is if one is married rather than to whom one is married. They construe marital status discrimination to include only whether a person is single, married, divorced, or widowed and not the identity, occupation, and place of employment of one’s spouse. The courts that have broadly construed the term "marital status" rule that it encompassed the identity, occupation and employment of one’s spouse.

The no-spouse policies may violate laws prohibiting both marital status and sex discrimination. They violate the marital status provision if the employer fails to present any evidence of business necessity other than the general perception that spouses in the same workplace might adversely affect the business. Thus, unless the employer can prove that the reasonable demands of the business require a distinction based on marital status and there is no better available or acceptable policy which would better accomplish the business purpose, an employer may not discriminate against an employee based on the identity of the employee’s spouse. There must be a compelling business necessity for which no alternative exists other than the discriminatory practice. This is known as the bona fide occupational qualification exception. (To be continued)

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