Employment Law & the Supremes: A Supreme Court Update

We’re confident all of you easily recall our artfully written post, Employment Law & the Supremes: A Supreme Court Preview, where we discussed a case on the Court’s docket, Vance v. Ball State University. Last week, in what turned out to be a boon for employers at the expense of employees, the Court made its decision in that case, as well as in University of Texas Southwestern Medical Center v. Nassar, another employment law case.

Vance v. Ball State University

In Vance, the question was who constitutes a “supervisor,” after a Circuit split developed between the 2nd, 4th, and 9th Circuits on one side and the 1st, 8th, and our Circuit, the 7th, on the other.

The 2nd, 4th, and 9th Circuits held that a supervisor is an individual whom an employer has empowered with the ability to direct and oversee an employee’s day-to-day tasks and work performance. This definition was also advanced by the Equal Employment Opportunity Commission, the agency responsible for administering Title VII.

The 1st, 8th, and 7th Circuits held that an individual only qualified as a supervisor if he/she was empowered with the ability to hire, fire, demote, promote, transfer, or discipline an employee (these actions are known as “tangible employment actions”). Many of these actions carry with them as potential for an economic consequence, such as losing one’s job, denied a higher paying job, demoted to a lower paying job, etc.

This distinction matters because employers are automatically liable for harassment engaged in by supervisors, even if the company didn’t know about it or have an opportunity to correct it. This concept is called “vicarious liability”: the idea that a supervisor acts as and on behalf of the company, so the supervisor’s conduct is automatically attributable to the company itself.

We at Walcheske & Luzi agreed with the definition used by the 2nd, 4th, and 9th Circuits, as it was the more common sense based approach. Individuals empowered with the ability to assign work/tasks, oversee work performance of others, etc., meet the common meaning and usage of the term in the workplace. Further, those people have the ability to negatively affect others’ work environment by doing such things as scrutinizing their performance at a higher level or assigning them more menial or undesirable tasks, as compared to other employees.

In the Vance case, the petitioner, Maetta Vance, alleged she was subjected to a racially hostile work environment by Saundra Davis, who assigned work to Vance.  Vance sued Ball State University alleging that it was liable for Davis’ racial harassment because Davis was her supervisor. Ball State argued that it could not be automatically liable for Davis’ actions because she could not take tangible employment actions against Vance.

In a big victory for employers, the Court (in a 5-4 decision) agreed with Ball State and adopted the view taken by the 1st, 8th, and 7th Circuits, holding that for the purposes of Title VII, an individual is only a “supervisor” if he/she is empowered by the employer to take tangible employment actions against the victim (aka, hire, fire, demote, promote, etc.).

That person you report to that evaluates your performance and assigns you the work that you do? That person is now just a coworker, assuming he/she can’t take tangible employment actions against you.

The practical effect is that if a person that’s technically above you (but can’t take tangible employment actions against you) engages in harassment against you in the workplace, you will be expected to complain about the harassment and allow your employer time to take corrective action to eliminate the harassment before you can begin considering filing a claim against that employer for harassment. If you do not complain or the employer is otherwise not somehow made aware the harassment is going on, which is a surprisingly common occurrence, then the employer is not responsible.

An excerpt from Justice Ginsburg’s dissent summarizes our view of the Court’s decision well:

Exhibiting remarkable resistance to the thrust of our prior decisions, workplace realities, and the EEOC’s Guidance, the Court embraces a position that relieves scores of employers of responsibility for the behavior of the supervisors they employ. Trumpeting the virtues of simplicity and administrability, the Court restricts supervisor status to those with power to take tangible employment actions. In so restricting the definition of supervisor, the Court once again shuts from sight the robust protection against workplace discrimination Congress intended Title VII to secure.

We will not be surprised if employers react to this decision by reorganizing and creating hierarchical reporting structures that place individuals that can oversee employees, but not take tangible employment actions, between employees and those that can, creating a layer of insulation from potential liability for workplace harassment.

The Court’s full decision in Vance can be found here for your reading pleasure.

University of Texas Southwestern Medical Center v. Nassar

The second victory for employers handed down by the Court last week came in the Nassar case. The question in that case regarded the standard of causation to be used in Title VII retaliation cases. The two options for the Court were the “motivating factor” standard and the “but-for” standard. The motivating factor standard is a lesser standard, meaning that it’s easier for a plaintiff to prove discriminatory causation under the standard, increasing the odds of a plaintiff’s success.

Cases brought under Title VII alleging discrimination based on race, color, sex, religion, and/or national origin are determined using the “motivating factor” standard. Under this standard, an individual must prove that his/her protected category (aka, race, sex, religion, etc.) was at least a factor in the employer’s adverse action. For example, if a person was claiming that she was terminated because of her sex, she need only prove that her sex played a role in the employer’s decision to termination her employment in order to prove causation (and therefore liability) under Title VII, even if other, legitimate, non-discriminatory factors were also in the mix.

The question comes in regarding retaliation, which is also prohibited by Title VII, because the language of Title VII does not make clear what standard is to be applied, whereas it specifically states that the motivating factor standard is to be applied to claims based on protected categories.

In another big win for employers, the Court determined that the but-for standard is the proper standard for causation for retaliation claims under Title VII. Under the “but-for” standard, the protected category must be the but-for cause of the employer’s action, not just a factor. This does not mean that it must be the “sole cause” for the action, but a plaintiff has to prove that but-for the protected category, the employer would not have taken the same action against him/her.

While this will likely not reduce the number of retaliation claims that are filed, it will ultimately reduce the number of those claims that are successful.

The Court’s full decision in Nassar can be found here for your reading pleasure.