from the Iowa District Court for Dubuque County, Michael J.
appeals district court judgment upholding local
commission's award of damages to former employee for
W. Fern of Putnam, Fern & Thompson Law Office, P.L.L.C,
Decorah, for appellant.
Reddick of Kane, Norby & Reddick, P.C., Dubuque, for
appellee Dubuque Human Rights Commission.
Charles Gribble and Christopher Stewart of Parrish Kruidenier
Dunn Boles Gribble Gentry Brown & Bergmann, L.L.P., Des
Moines, for appellee Jermaine Stapleton.
appeal, we must decide how to count employees to reach the
threshold "numerosity" required to apply a local
civil rights ordinance to a small business. The Dubuque
ordinance, with language matching the Iowa Civil Rights Act
(ICRA), exempts "any employer who regularly employs less
than four individuals." The defendant, a landscaper
whose hiring needs fluctuate seasonally, denies it met this
threshold under its proposed formula of counting only workers
who had been employed for twenty consecutive weeks. The
Dubuque Human Rights Commission (DHRC) rejected the
employer's numerosity challenge, found the employer
racially discriminated against a temporary worker, and
awarded damages. The district court affirmed. We retained the
reasons explained below, we conclude the DHRC correctly
determined that the defendant "regularly employed"
the requisite four or more individuals during its landscaping
season. The DHRC properly used a payroll approach and
rejected the employer's proposed twenty-week test.
Because substantial evidence supports the DHRC's
findings, we affirm the district court judgment upholding the
damages awarded to the former employee.
Background Facts and Proceedings.
agency record establishes the following facts. Simon Seeding
& Sod, Inc. (Simon Seeding) operates a seasonal
landscaping business based in Dubuque, Iowa. Jermaine
Stapleton, now age thirty-three, worked for Simon Seeding in
2006 and again in 2012. Stapleton, an African-American,
claims that Simon Seeding's owner, Leo Simon,
discriminated against him based on his race.
Events Leading to the Complaint.
grew up in Burnsville, Minnesota, and moved to Dubuque to
attend Clarke College. He began working for Simon Seeding in
April 2006. Stapleton recalled that Leo regularly referred to
him using racial epithets while working, such as
"chocolate guy" and "colored lad."
Stapleton did not respond "in kind, " but in his
[A] few times I asked him, you know, not to do it but, you
know, it was so continuous that it almost became, you know,
an everyday thing so I just kind of took it all in stride
because I needed the job so-
ceased working at Simon Seeding in September of 2006. He
returned to work there six years later.
in 2008, Stapleton was convicted of possession of a
controlled substance and sentenced to probation. In 2009, he
was arrested for operating a motor vehicle while intoxicated,
and the district court ordered him to the First Judicial
District Dubuque Residential/Work Release Facility
(work-release facility). Stapleton tested positive for
narcotics and was sent to prison. In 2012, he was transferred
from prison into the work-release facility, where residents
were required to maintain employment. Stapleton approached
Frank Berwanger, another resident, about returning to work at
Simon Seeding. Berwanger worked for Leo there. Stapleton told
Berwanger to tell Leo that he was the "colored guy"
who worked for Leo in 2006. Leo did not remember Stapleton,
but nonetheless hired him back at $8 per hour for twenty
hours per week.
resumed working for Simon Seeding on March 15. Leo resumed
calling him "chocolate guy, " "chocolate lad,
" and "colored lad." Stapleton estimated Leo
made such comments to him two or three times weekly.
"Ninety percent of the time" Stapleton would ask
Leo not to call him those words. Leo responded, "Oh Jay,
don't worry, it's not that big of a deal, I'm
just joking." Stapleton obtained another full-time job
at Roofco in April, but continued to work for Simon Seeding
part-time because he did not want to be disciplined at the
work-release facility for quitting.
6, Leo picked Stapleton up from the work-release facility to
drive with him to a job site in Wisconsin. Leo stated that
Stapleton did not seem "right, " and Leo believed
he may be "on" something. He asked Stapleton if he
really wanted to work that day, and Stapleton said he did.
When they arrived at the job site, it was raining and muddy.
Leo could not find a chain he needed to pull machinery out of
the mud. He said to Stapleton, "Stupid colored mother
fucker, find my chain now!" Stapleton responded,
"Man, can you please stop calling me that." Leo
retorted, "Well, if you don't like it, you can walk
home." Stapleton began walking back to the work-release
facility, fifty to sixty miles away. A half hour later, a
police officer stopped Stapleton to ask why he was walking
along the highway. Stapleton explained the situation, and the
police officer drove Stapleton back to the job site. The
officer told Leo that Leo was responsible for getting
Stapleton back to the work-release facility.
Leo had called the work-release facility and spoken with
residential officer Gael Huinker, who made the following
At 1015 hours this date, this RO received a phone call from
Leo Simon. Mr. Simon stated that when he picked Mr. Stapleton
up for work this date he didn't feel like Mr. Stapleton
really felt like working. . . . Mr. Simon then stated when
they got to Dodgeville it was raining so they sat in the
truck a while and when it stopped Mr. Stapleton took some
pictures and then didn't want to do anything else. . . .
Mr. Simon then asked this RO if we could pick Mr. Stapleton
up or if he could walk back. This RO began to ask a lot of
questions, asking some of them 2-3 times b/c the whole
situation was a bit confusing and Mr. Simon was giving real
short answers. Mr. Simon was informed by this RO that Mr.
Stapleton was not allowed to walk back to the facility and
asked if he could [stay] on site until the end of the day.
This RO also asked Mr. Simon to inform Mr. Stapleton that he
is not allowed to walk back and to please call us if anything
10:26 a.m., Leo called back and said Stapleton was
"walking over the hill." At 11 a.m., he called
again to say a police officer had brought Stapleton back to
the job site. At 11:27 a.m., he called a fourth time to
report that Stapleton was "taking pictures again"
and that "everything had worked out." At 1 p.m.,
Leo dropped Stapleton off at the work-release facility, and
Huinker observed the pair seemed to be getting along and were
laughing together. Stapleton informed her it "started
over a chain" and that Leo called him a racial slur.
next day, Stapleton called Leo to pick him up for work. Leo
told Stapleton that he did not need him anymore. Stapleton
never worked for Simon Seeding again.
received a complaint from another resident on May 6 about
Leo's discriminatory behavior. Stephen Toliver had worked
for Simon Seeding for one day when he told Huinker that Leo
had called him a "nigger" several times. Toliver
told Huinker he "realize[d] Mr. Simon [was] probably
just used to saying things like that because he has been
doing it for so long." He asked Leo to call him Steve.
Leo requested that Toliver not be placed for work with him
any longer because he did not think Toliver "was a very
discussed the complaints with Wendy Lyons, the work-release
facility's residential manager. Neither Stapleton nor
Toliver was disciplined for losing their jobs because they
had alleged discrimination. On May 29, Lyons decided the
facility would no longer place residents with Simon Seeding.
Leo phoned Lyons to protest her decision and called back
twice to say he was not racist and did not appreciate being
Complaint and Investigation.
filed his complaint with the DHRC on May 16, 2012. He alleged
discrimination in violation of Dubuque City Ordinance 8-3-3,
the city's counterpart to the ICRA. The DHRC sent the
first of eight letters to Leo on May 25, requesting a formal
response to the complaint and certain employment
documentation. Leo failed to respond. Seven more letters went
unanswered as the investigation continued over the next
fourteen months. On November 15, 2013, the DHRC requested a
subpoena for the employment documentation, including W-2s,
copies of payroll records, and a list of employees. In
December, the subpoena was served on Simon Seeding. By
February 2014, no information had been received. The DHRC
contacted Leo, who named his accountant. The accountant
responded to the investigator's direct inquiry by
providing the DHRC with Simon Seeding's payroll journal
and tax information.
payroll listed the only employees in 2012 as Leo, John
Berwanger, Frank Berwanger, and Jesse Weiland, without
including Stapleton. The DHRC found a note dated April 3,
2012, at the work-release facility that stated Stapleton had
been paid "for 40.5 hours of the week this date."
The DHRC found there was probable cause to investigate.
February 2015, a public hearing was held before an
administrative law judge and two commissioners (the panel).
Stapleton, his mother, his ex-girlfriend, and Wendy Lyons
testified on his behalf. Leo, Frank Berwanger, Greg James,
Jody James, and Erica Wiles (other employees) testified for
testified he overheard Leo refer to him as
"colored" or "chocolate" to Berwanger and
others at the worksite. He testified about the impact
Leo's statements had on him. He had been
"happy-go-lucky, " "open-minded, " and
"funny." But Leo's racial slurs changed his
Q. And did anything change after the series of remarks that
you described to us earlier in your testimony?
A. I'd say a lot changed. I, you know, went from super
high character to, you know, self-pity to just, you know,
yelling at my girl, yelling at my mom, getting real
irritable. There'd be nights in the halfway house where
I'd just stay up all night, you know, just-I was
struggling especially bad.
sought counseling to deal with his emotional difficulties. He
attended one session but did not continue because he lacked
insurance and could not afford it. Stapleton described
Leo's effect on him as a "scar that never goes
mother testified she noticed a change in him. They spoke
daily by phone, and he kept her informed as to what Leo
called him. She noticed that her son became depressed and
agitated. She testified that Stapleton now lives with her in
Minnesota, and he still talks about what Leo said and did.
The incidents "bring back the feeling of destitution,
of there's nothing I can do about it. Nobody cares about
it." Stapleton's ex-girlfriend testified similarly,
stating Stapleton would "lash out" and was not
getting any sleep because of the way he was treated. On
cross-examination, defense counsel raised Stapleton's
history of drug abuse and residency in the halfway house.
Defense counsel suggested those stressors caused
Stapleton's depression and anxiety.
and Leo denied the incidents described by Stapleton.
Berwanger testified he worked with Stapleton about
"ninety percent" of the time, and he never heard
Leo make any disparaging racial remarks. Berwanger did not
believe there was "any truth to Mr. Stapleton's
allegations." Greg James testified he is
African-American and has a biracial family, and Leo has never
given any indication of racist feelings. His wife, Jody
James, testified similarly.
described the record keeping at Simon Seeding. He admitted
there were some employees that were not on the payroll
records, including Jody James and Stapleton:
Q. Okay. Are there some employees that would not have been
accounted for by [the accountant]?
A. Right, and some of them, if they-you know, some only
helped a half a day or a day or something or somebody would
bring their buddy along; you know what I mean?
Q. And you wouldn't pay them through a payroll check,
you'd just pay them on the spot?
A. Yeah, because that's what some of them wanted,
same-day pay; you know what I mean?
. . . .
Q. Did you hear [Jody James] testify that she did work for
you between March 15th and May 6th of 2012?
A. Right, and as you said, she wasn't always on the
payroll. They had got gas for some wages and stuff like that
was advantage to them. They weren't all on the payroll.
Q. And I don't see Jermaine Stapleton on this April 1st
to June 30th period of time either. Didn't he work for
A. Right. He only worked a hundred and thirty-eight hours. He
was not full time.
Q. So you paid a number of other people who aren't listed
here for their services during that period of time; isn't
A. Not a ton of people, a few but not a ton.
March 30, the panel issued a proposed decision, finding Simon
Seeding had engaged in prohibited racially discriminatory
conduct. In determining whether Simon Seeding "regularly
employed" four individuals to bring it within the
ordinance, the panel defined that term to mean "at
regular intervals." From the employer's tax and
payroll documents, the panel determined,
For the weeks of March 18, 2012, March 25, 2012, April 1,
2012, April 8, 2012, April 29, 2012, May 20, 2012, and May
27, 2012, September 23, 2013, and September 30, 2012, Simon
Seeding employed five employees. During the weeks of April
15, 2012 and April 22, 2012, Simon Seeding employed six
employees. For the weeks of May 6, 2012, May 13, 2012, June
3, 2012, June 10, 2012, June 17, 2012, June 24, 2012, July 1,
2012, September 16, 2012, Simon Seeding employed four
employees. Simon Seeding's records show Simon Seeding
employed four or more employees for 19 weeks in 2012.
panel also questioned "the accuracy of Simon
Seeding's payroll and tax records." The panel
identified several individuals Simon Seeding admittedly
employed but omitted from its payroll records. The panel
found "Simon Seeding regularly employed four or more
employees in 2012."
panel determined Leo had subjected Stapleton to a hostile
work environment. It found, "Stapleton's testimony
is reasonable and consistent with the other evidence the
panel believes; Leo Simon's testimony is not." The
panel also noted, "Stapleton made contemporaneous
reports of Leo Simon's racial slurs to the work release
facility, to his mother, and to his girlfriend." Leo
initially denied using racial slurs, but later admitted he
may have made them in a joking manner. The panel awarded
$2817 in lost wages, $15, 000 in emotional distress damages,
and $29, 400 in attorney fees. Both parties appealed.
DHRC affirmed the proposed decision by a vote of 6-1. The
DHRC increased Stapleton's lost wages to $4500 by
correcting the panel's math error. The DHRC tripled the
emotional distress award to $45, 000, without explanation.
The DHRC found the attorney fees claimed by Stapleton were
not excessive, affirmed the $29, 400 fee award, and awarded
an additional $1600 for the administrative appeal.
Seeding filed a petition for judicial review in district
court. It argued it did not employ the requisite number of
employees to be subject to the Dubuque ordinance and denied
Stapleton's allegations of racial discrimination. It also
contended the evidence was insufficient to award lost wages
and emotional distress. The district court affirmed the
DHRC's decision and awarded an additional $4500 in
attorney fees for the judicial review.
Seeding appealed, and we retained the case.
Standard of Review.
decisions of municipal civil rights commissions [are]
reviewable to the same extent as final decisions of the Iowa
Civil Rights Commission (ICRC)." Palmer Coll. of
Chiropractic v. Davenport Civil Rights Comm'n, 850
N.W.2d 326, 332 (Iowa 2014). Iowa Code section 17A.19(10)
controls judicial review of an ICRC decision. Renda v.
Iowa Civil Rights Comm'n, 784 N.W.2d 8, 10 (Iowa
2010). The burden of demonstrating invalidity of the agency
action rests on the party asserting the invalidity. Iowa Code
§ 17A.19(8)(a) (2015).
standard of review depends on the aspect of the agency's
decision that forms the basis of the petition for judicial
review." Burton v. Hilltop Care Ctr., 813
N.W.2d 250, 256 (Iowa 2012). "[A] reviewing court can
only disturb . . . factual findings if they are 'not
supported by substantial evidence in the record before the
court when that record is reviewed as a whole.' "
Id. (quoting Iowa Code §
"When that record is viewed as a whole"
means that the adequacy of the evidence in the record before
the court to support a particular finding of fact must be
judged in light of all the relevant evidence in the record
cited by any party that detracts from that finding as well as
all of the relevant evidence in the record cited by any party
that supports it, including any determinations of
veracity by the presiding officer who personally observed the
demeanor of the witnesses and the agency's
explanation of why the relevant evidence in the record
supports its material findings of fact.
Iowa Code § 17A.19(10)(f)(3) (second emphasis
reviewing an agency's interpretation of law, "[t]he
level of deference afforded . . . depends on whether the
authority to interpret that law has 'clearly been vested
by a provision of law in the discretion of the agency.'
" Burton, 813 N.W.2d at 256 (quoting Iowa Code
§ 17A.19(10)(c)). If the legislature did not
clearly vest the agency with interpretive authority, we
review for correction of errors at law. Iowa Code §
17A.19(10)(c). An agency has been "clearly
vested" with interpretive authority only when we have a
"firm conviction" that "the legislature
actually intended . . . to delegate to the agency
interpretive power with the binding force of law."
Renda, 784 N.W.2d at 11 (quoting Arthur E. Bonfield,