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Faas v. Sears

July 10, 2008

LYNN FAAS, PLAINTIFF-APPELLANT,
v.
SEARS, ROEBUCK & CO., DEFENDANT-APPELLEE.



Appeal from the United States District Court for the Northern District of Illinois, Eastern Division. No. 05 C 5299-William J. Hibbler, Judge.

The opinion of the court was delivered by: Kanne, Circuit Judge

ARGUED MAY 9, 2008

Before FLAUM, KANNE, and TINDER, Circuit Judges.

Lynn Faas worked as a store general manager for Sears, Roebuck & Co. ("Sears") until she was fired in September 2004. One year later, Faas filed suit against Sears, claiming that Sears wrongfully terminated her employment in violation of the Age Discrimination in Employment Act (ADEA), 29 U.S.C. § 621 et seq. Following discovery, the district court granted summary judgment to Sears, which claimed that it had not dismissed Faas because of her age, but as a result of her poor performance. After conducting our own review of the record, we agree and affirm.

I. HISTORY

The following facts are recounted in the light most favorable to Faas, the non-moving party. Hemsworth v. Quotesmith.com, Inc., 476 F.3d 487, 489 n.1 (7th Cir. 2007). Lynn Faas, age 53, began her career with Sears as a part-time sales associate in 1974. For nearly twenty years, Faas worked her way up the company ladder, and she became the store general manager of Sears's Sheboygan, Wisconsin store in 1993. Faas received subsequent promotions to larger stores until finally settling in as the store manager of Sears's Fox Valley Mall store in Aurora, Illinois, in April 2000.

As store general manager, Faas held the top management position in the Fox Valley store. This meant that Faas was ultimately accountable for everything that happened within the store, including customer service, income generation, sales development, and special events. Eight assistant store managers headed the store's various departments and worked under Faas. Faas reported to the district general manager of the Chicago South District, who managed the fourteen Sears stores in the district. Each district general manager was supervised by a regional vice-president.

In late 2002, Sears developed a new method of evaluating the performance of its stores (and its store general managers). Part of this initiative included tabulating a "balanced scorecard" that analyzed each store's performance in four categories: customer satisfaction, personnel data, sales, and profits. Sears utilized a 5.0 point scale to rate each category-a score of 1.0 was considered the worst possible score, a 5.0 was a perfect score, and a 3.0 indicated "acceptable" performance. The balanced scorecard then averaged the scores for each of the four categories, which yielded a store's overall balanced-scorecard rating. Sears's corporate office issued balanced scorecards for each Sears store every month, and tracked the cumulative monthly scores for each store. The store managers were responsible for leading and coaching their teams to meet Sears's customer service and performance expectations, and were held accountable for their stores' balanced-scorecard scores.

When a district general manager felt that a store general manager was underperforming, the district manager could attempt to rehabilitate the store manager through a procedure called a "Performance Plan for Improvement." Sears outlined the Performance Plan for Improvement process in a policy guide issued to all Sears managers: a manager identifies the associate's performance deficiencies; the manager then discusses the performance shortfalls with the associate, and together they outline a plan for correcting the performance problems; finally, the manager follows up to ensure adherence to the corrective plan. Sears's policy guide explained that "[t]he manager . . . should use discretion to determine the exact timing for each follow-up step, considering the severity of the issue at hand and the opportunity to observe changes in performance; however, the manager must treat similar performance situations among associates in a consistent manner."

In November 2002, Robert Poss, Faas's district general manager, placed Faas on a Performance Plan for Improvement because of her inconsistent execution, lack of organization, and inability to train and to provide leadership to her sales associates and assistant store managers. Poss commented in a memo explaining his decision to place Faas on a Performance Plan, "[i]t appears to me at this point [that] Lynn is not capable of running this size store." Poss also noted that Faas's store lagged behind the other stores in the Chicago South District, and that her deficiencies as a manager resulted in unacceptably low customer-satisfaction scores for the Fox Valley store. Faas provided Poss with a corrective plan that acknowledged that she needed to better coach her employees.

Faas remained on the Performance Plan for Improvement until July 2003. Between November 2002 and July 2003, Poss followed up with Faas several times. On each occasion, Poss acknowledged that Faas had made some progress, but he also noted that Faas had not rectified many of her performance problems. Poss explained that the Fox Valley store's customer-satisfaction scores were still below the company average and those of the other stores in the district. Poss also called into question Faas's leadership skills because of her failure to develop her assistant store managers. And Poss noted on several occasions that if Faas did not improve, further action would be necessary, "including termination of employment." Poss finally removed Faas from the Performance Plan in July 2003, but he told her that she still needed to improve her customer-satisfaction scores. Around the same time, Poss issued a mid-year review to Faas in which he rated her a two out of five for results, and a three out of five for leadership. Faas later explained that she viewed Poss as "an excellent leader" and "a fair manager," and she did not believe that his decision to place her on a Performance Plan was related to her age.

Poss retired in October 2003, and was replaced by Wendy Carges as district general manager for the Chicago South District. When Carges took over for Poss, the Chicago South District stores had balanced-scorecard ratings that ranked among the worst of Sears's 63 districts nationwide. In order to improve the chronically underachieving stores in the Chicago South District, Carges assessed the individual performance of each of the twelve store general managers in her district, and determined that all but two of the store managers were underperforming. The two store managers that Carges believed to be adequately managing their stores, Ray Morris (age 59) and David Allen (age 62), were both older than Faas. Among the ten underperforming store managers, one had started with Sears only six months before Carges's hire and had only been at his store for one month, and four others did not begin at their stores until after Carges became district manager-one of these four store managers was also new to Sears. Carges discussed the situation with her regional vice-president, Steve Sunderland, who told her to take her time evaluating the store general managers in her district and gave her latitude to decide whether to place store general managers on Performance Plans for Improvement.

Faas was among the remaining five store general managers whom Carges considered to be underperforming. Carges's initial impression of Faas was that she had poorly managed the 2003 holiday season and that her team was not cohesive. Carges observed, as Poss had, that the balanced-scorecard numbers for the Fox Valley store were unacceptably low and were particularly weak in the customer-satisfaction category. The Fox Valley store was particularly important to Carges's plan for rejuvenating her district because it was the third largest volume store in the Chicago South District, and was scheduled to undergo remodeling beginning in November 2003.

After Carges spoke to Sunderland, she met with Faas twice in early 2004 and told Faas that she was considering placing her on a Performance Plan for Improvement. Carges did not immediately place Faas on a Performance Plan, and instead explained to Faas that she did not think that Faas had the requisite skill sets to run the large Fox Valley store, nor did she think that Faas was right for Sears's "current matrix." Carges encouraged Faas to consider "any and all options," such as a position in Sears's corporate offices or leaving Sears to run a specialty store. Faas told Carges that she liked her position as a store general manager and that she did not want to leave voluntarily.

In February 2004, Carges conducted a performance review of Faas and rated her a two out of five for both results and leadership. The review also contained a self-assessment section, in which Faas rated herself a two out of five for results and a three out of five for leadership. But Carges's performance review was not entirely critical: Carges complimented Faas for her handling of the remodeling of the Fox Valley store, and ...


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