Human Resource Management Paper

UV0024

This case is based on ideas and discussions with University of Washington students and prepared by Research Assistant Jenny Mead under the supervision of Andrew C. Wicks, Associate Professor of Business Administration. It was written as a basis for class discussion rather than to illustrate effective or ineffective handling of an administrative situation. Copyright © 2004 by the University of Virginia Darden School Foundation, Charlottesville, VA. All rights reserved. To order copies, send an e-mail to [email protected]. No part of this publication may be reproduced, stored in a retrieval system, used in a spreadsheet, or transmitted in any form or by any means—electronic, mechanical, photocopying, recording, or otherwise—without the permission of the Darden School Foundation.

DANVILLE AIRLINES

In a matter of hours, Julie Taylor, director of Human Resources at Danville Airlines in Milwaukee, Wisconsin, would have to make a difficult recommendation to the airline’s board of directors. One of the airline’s best pilots, David Reiger, 42, had recently lost his father to Huntington’s disease, a progressive, inherited neurological disorder that causes severe movement disorder and eventual dementia. Danville officials had been concerned about Reiger’s susceptibility to Huntington’s. In a routine blood test for alcohol and drug use, Danville had determined—after discreetly sending the blood elsewhere to be tested—that Reiger did indeed have the gene for Huntington’s disease. That meant that, at some point, Reiger would develop the disease. The airline had then informed Reiger that he had the gene. Furious that Danville had tested him without his consent, Reiger insisted that he be allowed to keep flying despite the discovery. If he developed Huntington’s while still flying for the airline, Reiger told Danville, he was willing to be reassigned to a position in the company that did not involve flying. He had threatened legal action if Danville grounded him before any symptoms appeared. The Danville Board of Directors had asked Taylor for a recommendation on how to handle the situation. She investigated and found there was no established protocol for dealing with this type of situation within Danville Airlines or the airline industry in general. As she contemplated her choices, Taylor felt a huge headache coming on. Huntington’s Disease

Huntington’s disease (HD) was discovered in 1872 by American physician George Huntington. The disease causes nerve cells in the brain to gradually deteriorate, leaving its victims incapacitated both physically and mentally; the prognosis is dementia and death. Symptoms include jerky movements, spasms, and increasing dementia (sometimes the depression caused by the disease transforms into schizophrenia). Over time, HD affects the patient’s ability to walk, talk, and reason. The disease strikes men and women of all races and

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ethnic backgrounds.1 The culprit is a single faulty gene on chromosome number 4. Children of a parent who has the gene stand a 50–50 chance of inheriting it. Those who have not inherited the gene cannot pass it (and the disease) on to their children; those who have it will inevitably develop the disease, usually in adulthood. The first symptoms generally appear in 30- to 40-year- old adults and the disease claims its victims within 15 to 20 years. There is no cure, only treatment aimed at alleviating the patient’s symptoms; that treatment includes drugs and life adaptations (changing a person’s physical environment to accommodate his or her physical deterioration). In some cases, HD strikes victims in their late teens or early 20s. In 2004, an estimated 30,000 people in the United States had HD, and 75,000 carried the abnormal gene that would cause them to develop the disease.2

In most cases, HD’s onset is slow and gradual, and the first symptoms are mild: muscle twitches and slight memory loss. In a small percentage of cases—fewer than 3%—the initial onset is more severe and dramatic and results in significant impairment of motor skills. That type of onset could prove extremely hazardous if a person were driving or operating heavy machinery at the time.

In 1993, as part of the Human Genome Project,3 U.S. and British scientists identified the gene that causes Huntington’s disease, making early detection possible. HD was then added to a growing list of illnesses such as amyotrophic lateral sclerosis (ALS, or Lou Gehrig’s disease), sickle cell anemia, myotonic dystrophy, and cystic fibrosis that can be identified through genetic testing. Unfortunately, like some other diseases, including ALS and sickle cell anemia, HD is not one that can be prevented or avoided through early detection. Reiger, Risks and Redundancies

As a Danville pilot, David Reiger flew four to five times a week, with a weekly average of eight to 10 hours in the air. None of his routes was long, and each required no more than two and a half hours at the controls. Taylor knew that all Danville flights had various backup plans and mechanisms, including a copilot and an autopilot, should the primary pilot on a flight become incapacitated. Aeronautical and airline engineers had calculated that those redundancies would be effective in preventing an in-flight crash 99% of the time should the pilot lose control on a flight. During the critical periods of taking off and landing (roughly two minutes each),

1 Probably one of the best-known people to succumb to Huntington ’s disease was the American folk singer

Woody Guthrie, who died in 1967. Before he was diagnosed, his slurred words and jerky movements were interpreted as drunkenness. His son, folk singer Arlo Guthrie, does not have the gene and consequently is not at risk for developing the disease.

2 “Learning About Huntington’s Disease,” http://www.genome.gov/page/cfm?pageID=10001215 (accessed 11 February 2006)

3 The Human Genome Project, which ran from 1990 through 2003, was a project coordinated by the U.S. Department of Energy and the National Institutes of Health. The project’s goals were to identify the approximately 20,000 to 25,000 genes in human DNA, determine the sequence of the three billion chemical base pairs making up DNA, create databases of that information, improve data analysis, and transfer many of the specific technologies it used to the private sector.

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however, tests showed that the redundancies would be less effective, preventing roughly 89% of the catastrophic failures caused by pilot error.

Like all pilots at Danville and other airlines, Reiger regularly went through a physical

exam given by the Federal Aviation Administration (FAA), which tested coordination, eyesight, and reflexes, among other things. He had passed his most recent physical and was cleared by the FAA to fly. If Reiger did become symptomatic, however, the FAA would bar him from taking the controls. Despite the safeguards and the FAA’s required annual physical, Reiger’s uncertain medical condition made him a risk both to his coworkers and to Danville passengers. Genetic Testing and Screening At that point, the FAA and Danville, along with most other airlines, had no policy in place about genetic screening, and there were no FAA plans in the foreseeable future to introduce that testing. Since the mapping of the human genome, genetic tests could be performed (or were being developed) to identify the presence of genes for almost 5,000 diseases. The benefits as well as the drawbacks of genetic testing were readily identified. With genomics (the study and application of genetic testing), those individuals without symptoms could find out whether they or their children were susceptible to a particular disease. With that knowledge, they could seek prophylactic treatment, if available. In all instances, people who carried an inherited gene base could make a more informed decision about a myriad of important choices such as whether or not to have children. The drawbacks—most notably, potential discrimination in employment or health insurance coverage based on test results—immediately became a controversial topic. People feared that genetic testing could adversely affect them if the information ended up in the possession of employers, insurers, mortgage companies, or any other institution with power over their economic future.4 Because of that potential for discrimination, scientists involved in the Human Genome Project and politicians immediately sought to put safeguards in place. The Constitution offered a modicum of protection, as did Congress’s 1974 Privacy Act. But specific federal regulations that protected people from genetic discrimination in employment did not exist.5 The only federal legislation in place at that point was the Health Insurance Portability and Accountability Act of 1996 (HIPAA), which stated that “genetic information shall not be considered a preexisting condition in the absence of a diagnosis of the actual condition.” That protection was limited, however, as it did not prohibit rate increases based on the results of genetic testing, it did not cover individuals not in a group plan, and it offered no protection against discrimination by employers6 Only a handful of states, including California, had laws

4 Sharona Hoffman, “Ask the Expert: Your Genetic Privacy,” National Women’s Health Report 22, no. 6

(December 2000): 6. 5 Anita Silvers and Michael Ashley Stein, “An Equality Paradigm for Preventing Genetic Discrimination,”

Vanderbilt Law Review 55, no. 5 (1 October 2002): 1,139. 6 Robert A. Curley Jr. & Lisa M. Caperna, “The Brave New World Is Here: Privacy Issues and the Human

Genome Project,” Defense Counsel Journal 70, no. 1 (1 January 2003): 22.

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specifically prohibiting (in most cases) insurers from denying coverage based on the results of genetic testing and for using those tests to determine insurance rates and health benefits.7

There was also the 1990 Americans with Disabilities Act (ADA), which barred adverse employment decisions based on an individual’s actual physical or mental disabilities and was designed to protect people with mental or physical impairments from discrimination. To be considered disabled, one had to have a physical or mental disability that limited the ability to perform at least one major life activity, such as walking. An individual could be covered under ADA if he or she had a history of disability, such as having had cancer, or the perception of having a disability, such as having a gene for a disease but not yet showing symptoms.

Under the ADA, disabled employees could not be dismissed from a job if they performed “with reasonable accommodation.” For example, an employee whose job was answering the phone and who was hard of hearing could not be dismissed. Under the law, an employer must accommodate that employee by providing, for example, a phone amplifier. On the other hand, if the only job available in a workplace was highly physical and required mobility and the employee was wheelchair-bound or otherwise physically constrained, the company could fire that worker with no repercussions. In the latter situation, the law was on the employer’s side given that accommodating such a person could subject that business to undue hardship. High cost was a deterrent to employers using genetic testing as part of the application process; in 2004, a genetic test cost approximately $1,000. Still, some people envisioned a future where those tests were a routine part of screening potential employees. In 2000, the American Management Association reported that approximately 70% of major employers required medical testing in the job-seeking process, and a handful of those companies were “already doing genetic testing, for sickle cell anemia, breast and colon cancer, and susceptibility to workplace hazards.”8 Many employers also required a family medical history, which often gave clues as to what diseases a potential employee had inherited. One specific incident revealing how the ADA offered protection involved a dental school graduate who had a late-onset form of Tay-Sachs disease, a fatal genetic disorder usually afflicting children that causes progressive destruction of the central nervous system. The dental graduate was competent both physically and mentally, but was at increased risk of developing muscle weakness, movement disorders, and possibly early-onset dementia. Claiming that she posed a serious risk to her patients, the state licensing board denied her a license to practice dentistry. The board noted that the ADA permitted application denial if an applicant “poses a direct threat to the health and safety of others.”9 Interpretation of the regulations implementing the ADA, however, stated that the concerns for the health and safety of others must be balanced against the “goal of protecting disabled individuals from discrimination.”10 The interpretation

7 “Genetic Discrimination,” Los Angeles Caregiver Resource Center, http://geroweb.usc.edu/lacrc/Diseases/FactSheets/genetic.htm (accessed 12 February 2006)

8 Hoffman, 6. 9 ADA Section 302[b][3], 56 Fed. Reg. 35701. 10 ADA.

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further provided that “objective evidence” must be used to determine “the probability that the potential injury will actually occur and whether reasonable modification of policies will mitigate risk.” The dental graduate planned to appeal her denial. One of the acknowledged risks of genetic testing was the potentially damaging psychological impact it could have on individuals susceptible to an inherited debilitating illness as well as to their families. Deep depression and anger were common emotions for those individuals; the flip side, should the person not be at risk, was guilt. Nonetheless, the emotional and psychological fallout of genetic testing was well known in medical circles. Airlines Under Pressure Since 1978, when the federal government had deregulated the airline industry to encourage competition, it had been the survival of the fittest, with many carriers going out of business and declaring bankruptcy. Some such as Continental had survived bankruptcy, but others (TWA) had ceased doing business. Many airlines survived by maintaining service while slashing costs, negotiating tough new contracts with employees, and limiting wage increases, health benefits, and work rule demands. Many carriers reduced the cost of their insurance by maintaining strict safety standards and good safety records. Nonetheless, in the post-9/11 and post-2000 Internet bubble era, airlines were struggling again. There were fewer passengers and the competition from low-fare carriers such as Southwest further increased the financial pressure. The year 2002 had seen the bankruptcies of two prominent airlines, U.S. Airways and United, and the near-bankruptcy of American Airlines. The airline industry’s losses for that year were expected to exceed $9 billion. The Investigation In an effort to determine what recommendation to make, Julie Taylor had—without using Reiger’s name—interviewed a number of key players, both within and outside of Danville. She had started with Steve Hillman, the Danville medical administrator, who had this feedback:

This pilot with Huntington’s disease could make the company’s medical insurance unaffordable, with premiums that would take a severe bite out of our profits. He could need 24/7 care for 30 years. I’m advising genetic screenings for all new employees. We won’t get stuck with this sort of expense if we never hire these people.

Chris Bowman, public relations manager for Danville:

This is a tough one. On the one hand, the flying public will panic if they even suspect that we employ a pilot with a neurological disorder—okay, a potential neurological disorder. You know what the public hears when you say potential

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disorder? Potential plane crash, that’s what. If the pilot claims discrimination, well, that’s not good either. We serve an affluent, educated business class. You think they’ll find it politically correct to climb aboard a “bigot” airline?

Danville Director of Operations Donald Berger had the bottom line and Danville’s

spotless accident-free record in mind when he commented:

Small airlines face a lot of competition. It’s a tough business. Our airline has an advantage because we’ve never had an accident. Believe me, in my position I’m well aware of what can cause accidents. Nearly 70% of airline accidents are linked to pilot error. I appreciate the pilot’s feelings, but what are hurt feelings compared with an airplane full of people?

Taylor also spoke to Danville’s insurance company and got this response from Atta

Commercial Insurance agent Carolyn Jennings:

I watch these companies very carefully. Airline employees have routine drug and alcohol testing, extensive training, and periodic on-the-job reviews. We hold equipment and maintenance to the highest standards—to protect passengers, of course, but also to protect the airline’s liability. Why shouldn’t we hold employees, particularly pilots, to the same high standards? Thank goodness for blood testing, which now can screen for potentially dangerous situations. Can you imagine what would happen if a pilot with HD slipped through? If there were an accident? We would have a major insurance disaster, and the airline might be out of business.

Taylor had also consulted with a physician, Patti Hicks, who was not affiliated with the

airline:

It is important for anyone who has been found to have the Huntington’s disease gene to know exactly what it means. The HD gene is a bad copy of a normal gene. Scientists do not yet know what this gene normally does, nor do they know how the abnormal gene causes the disease. Scientists around the world are working to learn more about this gene so that effective treatments can be developed.

It is impossible to predict when the disease will strike and how quickly symptoms will develop. For some people, the disease can be quite severe with movement problems developing while they are still children. But in many cases, no symptoms develop until very late in life. I’ve heard of some people with this gene who do not have any problems until they are well into their sixties or seventies.

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Civil rights activist Sylvia Gasca offered this perspective:

Employers can make reasonable demands for performance; that’s not job discrimination. But when they fire a person for reasons that have nothing to do with work performance, that’s discrimination, whether it’s racial or gender- or disability-based. And in the case of genetic information, it can be even more extreme, because the person may not even have a disease—just a gene. It’s genetic discrimination.

The Decision Taylor thought about the various points of view that these people had expressed. In particular, she remembered the words of Reiger’s wife, who was furious about the whole situation:

Giving him the test without his consent is inexcusable, but saying he can’t fly is preposterous. He’s not a child. He’s a responsible adult, who knows all about Huntington’s disease. If he experiences even a hint of a symptom, he’ll ground himself immediately. There’s no disease here now: just the gene that will cause the disease some day in the future.

Taylor also knew that Reiger himself had been devastated by the grueling experience of

watching his father die. The knowledge that he, too, stood a very good chance of living through that ordeal had to be earth-shattering for him and his family. Taylor had never before faced a decision that involved such a difficult variety of factors.