Court’s Holding Of No Extra-Territorial Application Of PHRA Begs More Questions

February 21, 2013

The United States District Court for the Eastern District of Pennsylvania recently held in Blackman v. Lincoln National that the Pennsylvania Human Relations Act (“PHRA”) does not cover employees who neither reside nor work in Pennsylvania. While that conclusion may seem obvious and logical, the decision may have a broader impact on employers.

Plaintiff, Kathy Blackman, was an Illinois resident working in the Illinois office of Lincoln National Corporation and Lincoln Financial Group, companies headquartered in Pennsylvania. Plaintiff alleged sex and age discrimination following a demotion, lodging a complaint with the Equal Employment Opportunity Commission. When she was subsequently fired and had exhausted her administrative remedies, she filed a discrimination and retaliation lawsuit under Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act (“ADEA”), and the PHRA against her former employers in the Eastern District of Pennsylvania.

Lincoln National moved to dismiss the PHRA claim on the basis that Blackman did not live or work in Pennsylvania. In deciding whether the PHRA applied, the court looked at the language of the PHRA.  Because the pertinent section of the PHRA was silent as to whether it applied to non-residents employed outside the Commonwealth, the Court examined other sections for the legislature’s intent. In concluding the PHRA did not apply to individuals who neither lived nor worked in Pennsylvania, the Court reviewed the Act’s intent which was to protect the “inhabitants” and “the people of the commonwealth.” The Court opined that to overcome the presumption that a state statute applies only within the state, there must be explicit statutory language providing for application beyond the state’s borders.

Plaintiff argued that the PHRA should apply even though she lived and worked in Illinois, because her employer, Lincoln National was headquartered in Pennsylvania. The court determined it did not matter where the employer was headquartered, but it was the plaintiff’s place of employment which dictates application of the state anti-discrimination laws. Further, the Court ruled that the Plaintiff’s attendance at quarterly meetings in Pennsylvania  and daily interactions with people in Pennsylvania were not enough to justify extending the PHRA to individuals who live and work outside of Pennsylvania.

The decision, however, leaves an unresolved issue – whether the PHRA protects those who live outside Pennsylvania, but who work in Pennsylvania. How does the Act treat a West Virginia resident who commutes across the border to his job in downtown Pittsburgh, or the New Jersey resident who works in Philadelphia? Do these commuters have a cause of action under the PHRA if they do not live in Pennsylvania?

Pennsylvania employers with out-of-state workers should be mindful of this unresolved issue as there may be no state administrative remedy under the PHRA for certain employees. This is useful information may limit any potential damages an employee could recover.

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