Non-criminal Offenses Are Prohibited Basis of Employment Discrimination Under the Wisconsin Fair Employment Act
In its recent decision in Cota v. Oconomowoc Area School District, the Wisconsin Supreme Court interpreted the term “arrest record,” which is a prohibited basis of employment discrimination under the Wisconsin Fair Employment Act (WFEA), to include municipal offenses. The WFEA defines “arrest record” as “information indicating that an individual has been questioned, arrested, charged with, indicted or tried for any felony, misdemeanor or other offense pursuant to any law enforcement or military authority.” At issue in the Cota case was whether the phrase “any … other defense” included municipal, i.e., non-criminal offenses. The Wisconsin Supreme Court’s majority opinion ruled that it does, affirming the decision of the Labor and Industry Review Commission (LIRC). This decision underscores the sweeping nature of the WFEA’s express statutory purpose of “protect[ing] by law the rights of all individuals to obtain gainful employment and to enjoy privileges free from employment discrimination.”
What Happened in This Case?
The Oconomowoc Area School District employed the Cotas as grounds crew members. During the Cotas’ employment, the District opened an investigation into allegations that the Cotas had retained the District’s scrap money for themselves. The investigation concluded that a sum of $5,638.81 in scrap money had not been received by the District. However, the investigation did not conclude which employee or employees were responsible for the cash shortfall. The District then turned the investigation over to the Town of Oconomowoc Police Department. Their investigation yielded no new information related to the Cotas; however, the Town of Oconomowoc cited the Cotas for municipal theft based on a coworker’s allegation that the Cotas had split scrap money with him on one occasion. About one year after the Town of Oconomowoc cited the Cotas for theft, the Assistant City Attorney for the Town of Oconomowoc informed the District that he believed he could obtain convictions against the Cotas and that he believed the case could be settled.
The next day, the District terminated the Cotas’ employment. In its termination letters, the District stated that it had “learned” that the Cotas “were, in fact, guilty of theft of funds from the School District” and that they had lied about this during the District’s investigation. The Town of Oconomowoc eventually dismissed the municipal theft citations against the Cotas.
How Did the Wisconsin Supreme Court Analyze the Term “Any … Other Offense”?
Wisconsin law distinguishes between criminal and non-criminal offenses and classifies all crimes as either felonies or misdemeanors. The District argued that the phrase “any … other offense” referred only to criminal offenses under the laws of jurisdictions that, unlike Wisconsin, do not classify crimes as either felonies or misdemeanors. The Cotas and LIRC argued that “any … other offense” includes violations of both criminal and non-criminal laws.
The Wisconsin Supreme Court agreed that the ordinary meaning of “any … other offense” includes violations of both criminal and non-criminal laws. In support of its holding, the Court noted that the ordinary definitions of “offense” are broad enough to include both criminal and non-criminal offenses and that such definition is consistent with the use of “offense” in other Wisconsin statutes in effect at the time when the WFEA’s definition of “arrest record” was adopted. Finally, the Court noted that this interpretation was consistent with the WFEA’s inclusive, rather than limiting, language and is consistent with the WFEA’s purposes.
How Did the Wisconsin Supreme Court Analyze the WFEA’s “Because of” Standard?
Having decided that “any … other offense” included non-criminal offenses, the Court turned to the next issue in the Cota case; i.e., whether the District terminated the Cotas because of their arrest records, in violation of the WFEA. The Court held that substantial evidence supported LIRC’s decision that the District terminated the Cotas because of their arrest records. Specifically, the record demonstrated that the District was not motivated to act by its own internal investigation because its investigation concluded without any determination on who was responsible for the cash deficit. Further, the District, through its Human Resources professional, testified that she was not suspicious enough that the Cotas had stolen the scrap money to fire them during her investigation. Further, the same Human Recourses professional testified that information she learned from the Town of Oconomowoc Assistant City Attorney caused her to terminate the Cotas.
Finally, the Court rejected the District’s argument that it was protected by the “Onalaska defense.” The Onalaska defense stems from the Wisconsin Court of Appeals decision in Onalaska v. LIRC, which held that an employer who does not rely on arrest-record information when making a discharge decision does not discriminate against an employee because of their arrest record. In Cota, the Court held that the Onalaska defense did not apply because substantial evidence supported LIRC’s decision that the District did terminate the Cotas because of their arrest records. Oconomowoc Area Sch. Dist. v. Cota, 2025 WI 11.
Bottom Line
In closing, the majority opinion of the Wisconsin Supreme Court clarified that, the WFEA “does not prohibit terminating employees with arrest records. Rather, it prohibits terminating employees because of their arrest records.” Employers should consult legal counsel for assistance in navigating the WFEA’s “because of” standard if an employee or prospective employee’s arrest record, including both criminal and non-criminal offenses, is a concern.
This article, slightly modified to note recent updates, was featured online in the Great Lakes Employment Law Letter and published by BLR®—Business & Legal Resources. Reproduced here with the permission of BLR®—Business & Legal Resources.
