Governmental immunity does not shield the state and other political entities from paying monetary compensation in anti-discrimination lawsuits, the Colorado Supreme Court ruled 4-3 on Monday.

In a pair of cases, the High Court considered whether claims under the Colorado Anti-Discrimination Act, specifically those asking for monetary compensation, are allowed, given that the Colorado Governmental Immunity Act generally shields political entities from liability.

“Our public servants should be the example, not the exception, for basic workplace antidiscrimination protections,” Merrily Archer, an attorney with EEO Legal Solutions LLC, said after the rulings.

The first case out of El Paso County involved a former sheriff’s lieutenant, Timothy Williams, who worked at the office between 2002 and 2016. In his final year on the job, Williams completed a mandatory survey from Sheriff Bill Elder about his retirement eligibility date. Shortly afterward, Elder became agitated with Williams after he alleged the office “conspired to cover up” a deputy’s misbehavior.

According to Williams, the sheriff subsequently told Williams that if he “can’t cut it then check out.” Given the close proximity of Williams’ retirement, the lieutenant interpreted this as an age-oriented remark. When Elder demoted Williams, he resigned immediately to avoid an adverse effect on his retirement benefits.

He then sued Elder, asking for compensatory damages and front pay – or money lost since the separation. The sheriff’s office in turn accused Williams of removing documents, which Williams considered retaliation for the age claim.

The Colorado Governmental Immunity Act, nearly 50 years old, recognizes that liability lawsuits could raise the cost of government functions or prevent the delivery of essential services. A Supreme Court decision in 2000 deemed claims under CADA exempt from governmental immunity, but it was 13 years later that the General Assembly authorized the types of financial remedies in anti-discrimination cases that Williams sought.

Justice Monica M. Márquez observed during oral argument for the two cases that the legislature, in attempting to broaden the relief available to victims of workplace discrimination, “effectively they brought it right within the CGIA and rendered the whole scheme … at least for government employers, immune from suit.”

An El Paso County District Court judge agreed with Williams that the governmental immunity law did not bar monetary claims against the state, and the Colorado Court of Appeals upheld that decision in November 2019. Because CADA was “not designed primarily to compensate individual claimants,” but to address workplace discrimination, wrote Judge Rebecca R. Freyre, the appeals panel allowed Williams’ front pay and retaliation claims to proceed.

Agreeing with that view, the Supreme Court’s majority noted CADA’s principal aim was not to compensate individuals, and therefore any financial benefits that come about through the eradication of workplace discrimination are “incidental.”

“The relief is necessary in order to help the individual enforce these anti-discrimination statutes,” argued Euell B. Thomas of Livelihood Law, LLC to the justices. “Some agencies are not going to pay attention unless it costs them money.”

Elder also contended that because the General Assembly wrote the relevant section of CADA to apply to “the state,” it does not include other political units, like his office.

Bryan E. Schmid, senior assistant El Paso County attorney who represented the sheriff, told the justices that “the state has 20,000-plus employees and a $35 billion budget, through which they can absorb these types of compensatory damages,” in contrast with local governments.

Justice Richard L. Gabriel, writing for the majority, acknowledged Elder’s interpretation was reasonable, while concluding that “it would be illogical for us to infer that in attempting to broaden the tools available to those who have suffered workplace discrimination, the legislature, at the same time, excluded from CADA’s reach a broad swath of workers employed by the state’s political subdivisions and agencies.”

The Court also disagreed with Elder’s argument that CADA claims are the kinds of liability actions the immunity statute blocks.

Márquez authored the dissent on behalf of herself, Chief Justice Nathan B. Coats and Justice Brian D. Boatright. Because discrimination lawsuits and immunity-granted liability claims stem from the same types of injuries, she argued, it would be inappropriate for judges to decide which ones serve a broader purpose, such as ending workplace discrimination, and which ones do not.

“[M]any causes of action that are subject to the CGIA implicate public policy. By their very nature, claims for wrongful discharge in violation of public policy have public interest implications,” Márquez added. To have courts define “which policy goals are in the ‘public interest’ and thus outside the scope of the CGIA” would give “the appearance of judicial policymaking.”

The dissenting justices also agreed with Elder that the legislature had not clearly determined that discrimination claims against “the state” also included other political units. Márquez blamed “inconsistent language” in the General Assembly’s 2013 amendments to CADA, and predicted the Supreme Court would need to further clarify the law in the future.

Denver Health ruling

In the second case, Brent M. Houchin sued Denver Health, alleging his sexual orientation and retaliation were at play in his termination.  Houchin was an employee relations manager, the position responsible for ensuring compliance with relevant laws and employee policies. Houchin reported that the interim human resources officer, upon learning that Houchin had a husband, visibly expressed disgust and subsequently treated Houchin disrespectfully.

Houchin disagreed with one of Denver Health’s lawyers about his ability under federal law to use employees’ medical records when investigating suspected drug violations at the hospital. The interim HR officer terminated Houchin for two privacy violations, even though Houchin reported the lack of a prior disciplinary record.

“As an HR professional for 25 years, the brazen nature of Denver Health’s discriminatory treatment really concerned me,” said Houchin in a statement following the ruling. “Now, I realize why: Denver Health thinks it is above the law, and above employee antidiscrimination and whistleblowing protections applicable to every other Colorado employer.”

A separate Court of Appeals panel split 2-1 in determining Houchin was entitled to sue Denver Health, which is a governmental entity, for monetary compensation in his discrimination and retaliation claim. However, unlike in the El Paso County case, the majority believed claims against “the state” referred only to Colorado’s government.

Archer, representing Houchin, told the justices during oral argument, “I believe in my soul that that [decision] would create an unconstitutional classification between two kinds of public servants,” with the effect of depriving public employees at smaller or rural agencies court access for anti-discrimination lawsuits. 

Federal anti-discrimination laws cover employers with 15 workers or more, while CADA addresses all employers.

As in the Williams decision, the Supreme Court’s majority allowed Houchin’s claims to continue, deeming them valid against political subdivisions other than the state. Márquez, Coats and Boatright dissented once again.

In a statement, Denver Health denied Houchin’s dismissal had anything to do with his sexual orientation and that the dismissal stemmed from a legitimate concern for patient privacy rights.

Archer did not believe the decisions would dramatically expand the liability of governments, adding in an email that the anti-discrimination laws’ main purpose of protecting workers would continue to operate.

Colleen T. Calandra, an employment attorney with Ramos Law, said that the ruling follows a current pattern, amplified under the Black Lives Matter movement, “to hold government actors accountable and not provide blanket immunity. For years courts over and over and over would find in favor of government immunity.  However, we are see that this is a changing trend.”

The cases are Elder v. Williams and Denver Health and Hospital Authority v. Houchin.