Divided Court holds that a "supervisor" must be empowered to take tangible employment actions for vicarious liability under Title VII to apply and that Title VII retaliation claims are subject to a higher "but-for" causation standard.

On June 24, the U.S. Supreme Court issued the following two 5–4 employment law rulings that have major implications for claims brought under Title VII of the Civil Rights Act of 1964 (Title VII):

  • In Vance v. Ball State University, the Court held that an employee is a "supervisor" for purposes of vicarious liability under Title VII only if he or she is empowered by the employer to take tangible employment actions against the victim.[1] In so ruling, the Supreme Court narrowed and clarified the definition of "supervisor" and rejected the Equal Employment Opportunity Commission's (EEOC's) broad definition of "supervisor."[2]
  • In University of Texas Southwestern Medical Center v. Nassar, the Court held that Title VII retaliation claims must be proved according to the traditional principles of "but-for" causation and not the lessened causation test stated in 42 U.S.C. § 2000e-2(m).[3] The heightened standard requires proof that the unlawful retaliation would not have occurred in the absence of the alleged wrongful action or actions of the employer.[4]

Both decisions are likely to be viewed favorably by employers, but the 5–4 decisions show that the Court is still deeply divided on these issues. We will monitor whether Congress takes any legislative action in response to these rulings.

When an Employee Is a "Supervisor" for Vicarious Liability Under Title VII

In Vance, the Court rejected a more expansive definition of "supervisor" that was supported by the EEOC and held that, to be considered a "supervisor" for purposes of vicarious liability under Title VII, an individual must have the power to take tangible employment actions against the victim.[5] The Vance case arose out of the claim of Maetta Vance, an African-American catering employee at Ball State University (BSU), who alleged that a co-worker had created a racially hostile work environment. In an opinion issued by Justice Samuel Alito, the Court affirmed the decision of the U.S. Court of Appeals for the Seventh Circuit to grant summary judgment to BSU, agreeing that the authority to take tangible employment actions is the defining characteristic of a supervisor. In doing so, the Court limited the circumstances under which an employee can claim that an alleged harasser is a "supervisor." This narrow interpretation of the definition of "supervisor" may impact the number of future vicarious liability claims brought under Title VII.

Background

Vance had worked in catering at BSU since 1989. She claimed that another colleague subjected her to a racially hostile work environment in violation of Title VII and that BSU was vicariously liable for the conduct because the co-worker was a "supervisor" by virtue of the fact that there were times when the co-worker would lead or direct Vance and other employees in the kitchen. Both the district court and the Seventh Circuit rejected that analysis, granting summary judgment to BSU. In seeking certiorari, Vance relied on the EEOC's Enforcement Guidance, which takes the position that an employee, in order to be classified as a supervisor, must wield authority "of sufficient magnitude so as to assist the harasser explicitly or implicitly in carrying out the harassment."

The Court's Opinion

The Court rejected the EEOC's position and affirmed the decisions of the lower courts, finding that an employee is a "supervisor" for purposes of vicarious liability under Title VII only if he or she is empowered by the employer to take tangible employment actions against the victim. The Court found no evidence that Vance's co-worker directed her day-to-day activities or that BSU empowered Vance's co-worker to take any tangible employment action against her. The majority dismissed the EEOC's broader definition of "supervisor" as "vague and ambiguous" and relied on two of the Court's prior cases, Burlington Industries, Inc. v. Ellerth[6] and Faragher v. Boca Raton,[7] which drew distinct lines between co-workers and supervisors. The Court stated the following:

Only a supervisor has the power to cause "direct economic harm" by taking a tangible employment action. . . . "Tangible employment actions fall within the special province of the supervisor. The supervisor has been empowered by the company as a distinct class of agent to make economic decisions affecting other employees under his or her control. . . .Tangible employment actions are the means by which the supervisor brings the official power of the enterprise to bear on subordinates."[8]

The dissent—written by Justice Ruth Bader Ginsburg and joined by Justices Sonia Sotomayor, Stephen Breyer, and Elena Kagan—stated that the majority opinion would leave employees unprotected against harassment by co-workers and undermine Title VII's capacity to prevent workplace harassment. Justice Ginsburg argued that the majority's limited definition of "supervisor" ignores "an all-too-plain reality: A supervisor with authority to control subordinates' daily work is no less aided in his harassment than is a supervisor with authority to fire, demote, or transfer."[9]

Implications

Employers will welcome this decision because it narrows the scope of when an employee is a "supervisor" for the purposes of vicarious liability. The decision should eliminate the question of supervisor status in many cases as a matter of law before such cases get to trial, thus allowing an employment discrimination case to focus on the substantive issues without a lengthy discussion of whether a co-worker is a "supervisor." However, even with a more narrow definition of "supervisor," employers still need to be cognizant of how they react to hostile work environment claims by employees. Under the ruling, an employer can still be held liable when its negligence leads to the creation or continuation of a hostile work environment.

Title VII Retaliation Claims Are Subject to Heightened "But-For" Causation Standard

In Nassar, the Supreme Court held that, to demonstrate retaliation in violation of Title VII, a plaintiff must prove that the alleged retaliation was the "but-for" cause of the alleged wrongful action. It rejected an effort to apply the broader "motivating factor" analysis used in general or "status" claims of discrimination under the statute. Justice Anthony Kennedy, writing for the Court, differentiated between "status" claims, which are directly referred to in 42 U.S.C. § 2000e-2(m) as being covered by a "motivating factor" analysis, and retaliation claims, which are not referenced in that section. The decision lends definitional certainty in an area that has been controversial and has resulted in differing views from trial and appellate courts, and it should make it easier for employers to obtain summary judgment in cases with weakly pled or supported retaliation claims.

Background

Dr. Naiel Nassar filed a Title VII action against the University of Texas Southwestern Medical Center, alleging that he was constructively discharged from his university faculty position because of racially and religiously motivated harassment. Dr. Nassar also alleged that the university retaliated against him for complaining about the harassment when it sought to prevent an affiliate hospital from hiring him. A jury found for the doctor on both claims and awarded him back pay and compensatory damages. The U.S. Court of Appeals for the Fifth Circuit vacated the verdict with regard to the plaintiff's discrimination claim but affirmed the retaliation claim on the theory that retaliation claims require only a showing that retaliation was a "motivating factor" for the adverse employment action rather than the "but-for" cause.

The Court's Opinion

The Court rejected the Fifth Circuit's holding on retaliation, finding specifically that "Title VII retaliation claims must be proved according to traditional principles of 'but-for' causation, not the lessened causation test stated in § 2000e-2(m)."[10] The majority relied largely on language from the Civil Rights Act of 1991, which amended § 2000e-2(m) of Title VII and explicitly states that liability is established when the plaintiff proves that "race, color, religion, sex, or national origin was a motivating factor for any employment practice, even though other factors also motivated the practice." The Court held that, had Congress also intended to cover retaliation under this less restrictive standard, it would have and could have included it in that list.

The Court made efforts to differentiate between the forms of discrimination listed in § 2000e-2(m), which it defined as "status"-based discrimination claims, and retaliation claims, and it noted the "ever-increasing frequency" with which retaliation claims are being filed—a number that has more than doubled in the last 15 years.[11] The Court suggested that a lower standard would siphon resources from employers, administrative agencies, and courts to combat harassment. It cautioned that the application of a lower standard might tempt employees who foresee that they are about to be fired to make unfounded claims of discrimination in an effort to arm themselves with the necessary ammunition for retaliation claims if and when they are fired. The Court also explicitly rejected the contrary position urged by the EEOC in its regulations as not worthy of deference.

The dissent, written by Justice Ginsburg, stated that retaliation claims are, at their core, encompassed within the alleged discrimination that instigated the protected activity in the first place. Justice Ginsburg also expressed concern for trial judges and juries that will have to apply two sets of causation standards in cases where discrimination and retaliation under Title VII are alleged. The majority opinion indirectly addressed this issue by highlighting the omission of retaliation claims within the "motivating factor" language of the Civil Rights Act and, by contrast, the specific inclusion of retaliation in the causation section of the subsequently passed Americans with Disabilities Act.

Implications

Lawyers who litigate cases in which discrimination and retaliation claims are raised deal regularly with situations where the defenses to a retaliation claim are far more challenging than those covering the initial discrimination claim. Where the reduced "motivating factor" standard has been applied, it has been much more difficult to obtain dismissal at trial or on motion, even of very weakly supported retaliation claims. This decision clarifies the retaliation standard and will likely result in more retaliation cases being decided at the summary judgment stage.

[1]. Vance v. Ball State Univ., No. 11-556 (U.S. June 24, 2013), available here.

[2]. Vance, slip op. at 9–10.

[3]. Univ. of Tex. Sw. Med. Ctr. v. Nassar, No. 12-484 (U.S. June 24, 2013), available here.

[4]. Nassar, slip op. at 20.

[5]. Vance, slip op. at 30.

[6]. 524 U.S. 742 (1998).

[7]. 524 U.S. 775 (1998).

[8]. Vance, slip op. at 18 (quoting Ellerth, 524 U.S. at 762) (first alteration added).

[9]. Id. at 8 (Ginsburg, J., dissenting).

[10]. Nassar, slip op. at 20.

[11]. Id. at 18.