June 26, 2013

Doubling Down: Supreme Court Issues Two Key Rulings Regarding Civil Rights Act Of 1964

Carol Barnett, Jon Bierman, Andrew Cripe, Jay Dade, Sean Gallagher, Christopher Mason, Brian Zickefoose

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On Monday, the Supreme Court of the United States issued two important opinions for employers facing liability and retaliation claims brought under Title VII of the Civil Rights Act of 1964 ("Title VII"). A precise analysis of those decisions, and their potential implications for employers, follows:

Determining Liability Under Title VII

In Vance v. Ball State Univ., No. 11-556, the Supreme Court resolved a split among the U.S. Circuit Courts of Appeals by holding that a "supervisor," for the purposes of determining liability under Title VII, includes only those individuals with the power to directly affect the terms and conditions of an employee's employment.

Plaintiff, an African-American employee of Ball State, filed suit under Title VII alleging that she had been subjected to a racially hostile work environment by a fellow employee, Saundra Davis, who was a Caucasian. Specifically, Plaintiff filed internal complaints and charges with the Equal Employment Opportunity Commission ("EEOC") alleging racial harassment and discrimination because Davis "gave her a hard time at work by glaring at her, slamming pots and pans around her, and intimidating her."

Plaintiff filed suit and both parties eventually moved for summary judgment. The District Court entered summary judgment in favor of Ball State holding it could not be held vicariously liable for Davis' alleged racial harassment because Davis was not Plaintiff's supervisor as Davis could not "hire, fire, demote, promote, transfer, or discipline." The Seventh Circuit affirmed the decision explaining that because Davis was not a supervisor under Title VII, Plaintiff could not recover from Ball State unless she could prove negligence. Plaintiff appealed.

In a 5-4 majority decision, the Supreme Court affirmed the Seventh Circuit's decision concluding that "an employer may be vicariously liable for an employee's unlawful harassment only when the employer has empowered that employee to take tangible actions against the victim." In other words, the individual must be able to "effect a 'significant change in employment status, such as hiring, firing, failing to promote, reassignment with significantly different responsibilities, or a decision causing a significant change in benefits." The Court noted that the ability to direct another employee's tasks is not, in and of itself, sufficient to prove an individual is a "supervisor."

Retaliation Claims: A Heightened Burden of Proof

In University of Texas Southwestern Medical Center v. Nassar, The Supreme Court held that retaliation claims brought under Title VII must be proven by demonstrating that "but-for" the retaliatory motive, the adverse employment action would not have occurred. The Court elected to impose this legal standard over a less stringent test from discrimination cases involving mixed motives. The decision heightens the burden of proof for a plaintiff attempting to prove retaliation under Title VII or similar statutes. This is good news for employers defending retaliation cases.

Dr. Naiel Nassar, a physician of Middle Eastern descent, was hired by the University of Texas Southwestern Medical Center (UTSW) to work both at UTSW and at a hospital. Nassar later resigned from the UTSW faculty citing harassment based on religion and race. Nassar claimed he resigned from UTSW based on an offer of a position at the hospital; however, the hospital withdrew its offer after opposition to his hire arose from the UTSW faculty. Nassar sued UTSW under Title VII and argued that UTSW had forced him to resign and retaliated against him because of his previous complaints based on religion and race. The jury found in favor of Nassar and awarded him back pay and compensatory damages. The U.S. Court of Appeals for the Fifth Circuit affirmed in part, holding that there was sufficient evidence to support the retaliation claim.

The question before the Supreme Court was whether Title VII's anti-retaliation provision and similarly-worded statutes require a plaintiff to prove that "but-for" the retaliation, the employer would not have taken an adverse employment action. The Court answered this question in the affirmative. Although the dissent argued for the lower standard used in discrimination cases, the majority, written by Justice Anthony Kennedy, found that such a standard should not be used for retaliation claims.

Notably, in support of the decision, the majority relied, in part, on a practical consideration, arguing that if the dissent's view was adopted, it could "contribute to the filing of frivolous claims, siphoning resources from efforts by employers, agencies, and courts to combat workplace harassment."

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.