Court rules for employers in two employment discrimination cases
on Jun 24, 2013 at 3:44 pm
Congress and the Court have long had a back and forth over the proper scope and implementation of the nation’s civil rights laws. Sometimes the cross-branch discussion has been a constitutional debate, as in Shelby County v. Holder, the still-pending challenge to the constitutionality of Section 5 of the Voting Rights Act. But equally important has been a series of cases concerning the proper interpretation of civil rights law – especially Title VII of the Civil Rights Act, which prohibits employment discrimination – and congressional enactments sometimes codifying, and sometimes overruling, those decisions.
Today, the Supreme Court continued that tradition in a pair of five-to-four decisions narrowly construing the scope of Title VII’s retaliation and employer liability rules. In University of Texas Southwestern Medical Center v. Nassar, the Court strictly interpreted a statute that Congress enacted to overrule a prior Supreme Court decision, holding retaliation claims to a stricter standard of proof than other forms of discrimination claims. In Vance v. Ball State University, the same majority narrowly defined who counts as a “supervisor” whose discrimination is automatically attributed to an employer. Justice Ginsburg, writing for the Court’s four more liberal Justices, invoked the history of congressional overruling of the Court’s employment discrimination decisions to call upon Congress to once again reverse both decisions issued today.
As explained in our preview, the plaintiff in Nassar claims that he was denied permanent employment at a medical center after complaining about discrimination by his supervisor. The employer argued that regardless of any retaliatory intent, it would not have hired him anyway for perfectly legitimate reasons. The question before the Supreme Court was what standard of proof applies in such cases – must the plaintiff prove only that retaliation was a “motivating factor” in the decision or must he prove that he would have gotten the job except for the retaliatory intent?
A. Majority Opinion
Justice Kennedy’s opinion for the Court framed the dispute by explaining that in tort law generally, the proper standard for causation is “but for” causation – the plaintiff must show that “but for” the illegal act, her injury could not have occurred. So, in an employment discrimination case, under ordinary rules, the plaintiff would have to show that she would have gotten the job if the employer had not taken her race into account. The Court presumes that Congress intends to use this standard, unless it indicates a different intent in the statute. The question in this case was whether Congress had indicated such an intent with regards to retaliation claims.
To decide that question, the Court had to work through some history. In Price Waterhouse v. Hopkins, the Court had departed from the traditional causation for ordinary (i.e., non-retaliation) discrimination claims. It held that all a plaintiff had to prove was that the worker’s race, sex, or religion was a “substantial” or “motivating factor” in the decision. The employer would then be liable unless it could prove that it would not have hired (or would have fired, etc.) the worker even if it had not taken into account the protected characteristic.
Congress then enacted the Civil Rights Act of 1991, which overruled a number of the Court’s interpretations of Title VII and other civil rights statutes. One provision codified in part, and overruled in part, Price Waterhouse. Congress said 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.” And rather than allowing an employer to avoid liability by showing that it would have taken the action anyway, Congress provided that such a showing would simply shield the employer from damages, but not from injunctive relief (e.g., an order reinstating the worker to her prior position) or attorney’s fees.
The question in Nassar was whether this provision applies not only to claims of “status-based” discrimination (e.g., discrimination on the basis of race, sex, or religion), but also to retaliation claims. The Court held that it did not.
The Court began by noting that the language of the retaliation provision does not, itself, indicate any intent to depart from the ordinary “but for” standard. So the real question was whether the 1991 provision extended to all of Title VII, including retaliation claims. The Court concluded that it did not, for three reasons. First, the 1991 provision expressly extends only to claims of discrimination on the basis of “race, color, religion, sex, or national origin.” If Congress had intended to cover retaliation as well, it would have included it in that list. Second, the structure of the statute supported the employer’s interpretation. Title VII divides status-based discrimination and retaliation into two different provisions, and the 1991 amendment was passed as an amendment to the status-based provision. Third, the Court rejected the argument made by the worker and the government that, because retaliation can be seen as form of discrimination, there was no need for Congress to separately mention the retaliation provision. The Court acknowledged that it had previously construed statutes prohibiting only discrimination to implicitly prohibit retaliation as well. But it concluded that those decisions were not controlling here, because Title VII expressly discusses retaliation and treats it as different from status-based discrimination.
The Court further explained that in its view, subjecting retaliation claims to a stricter proof standard made practical sense, given the “ever-increasing frequency” with which retaliation claims are being filed (more than 31,000 in 2012). The Court openly worried that under a lesser causation standard, an employee who foresaw that she was about to be fired could make an unfounded claim of discrimination to set up a retaliation claim if and when she was fired.
Finally, the Court rejected the government’s suggestion that it should defer to the views of the EEOC and declined the worker’s invitation to apply the pre-1991 causation standard announced in Price Waterhouse – which, the Court concluded, had been vitiated by the subsequent statute.
The dissent began by emphasizing the practical importance of effective anti-retaliation protection and the “symbiotic relationship between proscriptions on discrimination and proscriptions on retaliation.” And, to the dissent, it simply makes no sense to believe that in enacting a provision to “restore and strengthen” antidiscrimination law in 1991, Congress would have intended to exclude retaliation claims from the scope of a provision intended to loosen causation standards for workers. Unlike the majority, the dissent believed it significant that the Court had, in several cases prior to the enactment of the 1991 amendment, held that retaliation was a form of discrimination. And even if it was not, even if the 1991 amendment did not on its own extend to the retaliation provision, the dissent believed that the Court should construe the retaliation provision (which says nothing specific about the standard for causation) in concert with the rest of the statute and apply the same “motivating factor” analysis. By requiring different standards for different kinds of Title VII claim, the Court’s decision was likely to sow confusion for trial courts and juries.
Perhaps reaching the core of the disagreement between the majority and dissent, Justice Ginsburg also argued that the traditional “but for” standard is ill suited for discrimination cases because it requires juries to conduct unrealistic thought experiments about “what would have happened if the employer’s thoughts and other circumstances had been different.”
In the end, the dissent accuses the majority of being “driven by a zeal to reduce the number of retaliation claims filed against employers,” but concludes that “Congress had no such goal in mind” in 1991.
In Vance v. Ball State University, the same majority, over the objections of the same dissenters, narrowly defined who counts as a “supervisor” for purposes of Title VII liability. Siding with the employer, a five-Justice majority of the Court held that a supervisor is someone with the power to take “tangible employment actions” (like hiring, firing, etc.) against the victim; someone who merely directs the day-to-day activities of a worker does not count.
After setting out the facts of the case (described in our preview), Justice Alito’s opinion for the Court explained that in Burlington Industries v. Ellerth and Faragher v. Boca Raton, the Court had held that “an employer is directly liable for an employee’s unlawful harassment if the employer was negligent with respect to the offensive behavior.” But the Court held that “different rules apply when the harassing employee is the plaintiff’s ‘supervisor.’” In developing a rule for that context, the Court had relied on general principles of agency law, which provide that a “master” is liable for the acts of his “servant” when the servant was “aided in accomplishing the tort by the existence of the agency relationship.
In Faragher and Ellerth, the Court had stated that this common law test is met when the discriminator uses his power as a supervisor to (for example) hire, fire, or refuse to promote an employee to perpetuate the sexual harassment. If the harassment does not culminate in a tangible employment action, the employer is liable unless it can establish, as an affirmative defense, that it exercised reasonable care to prevent and promptly correct harassing behavior and that the victim unreasonably failed to take advantage of any preventive or corrective opportunities the employer provided. The bottom line, the Court explained, is that it is easier to prevail against an employer if the person engaged in the harassing conduct is considered a “supervisor” rather than a mere “co-worker.”
Resolving a conflict in the lower courts, the majority held that a “supervisor” is someone whom “the employer has empowered” to “take tangible employment actions against the victim, i.e., 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.”
This rule, the Court explained, was consistent with Faragher and Ellerth because in both cases the supervisors had that power and because those decision contemplated a sharp distinction between supervisors and co-workers. Moreover, the rule is easy to apply. “By contrast, under the approach advocated by petitioner and the EEOC, supervisor status would very often be murky.” That definition – which asks whether the harasser wields authority “of sufficient magnitude so as to assist the harasser explicitly or implicitly in carrying out the harassment” – is a “study in ambiguity.” In contrast, the Court believed that the tangible employment action standard had the significant advantage of being susceptible to resolution in many cases by a court before trial.
Justice Alito’s opinion bristled at the dissent’s suggestion that the majority’s position is “out of touch with the realities of the workplace.” Instead, he insisted, “it is the alternative that is out of touch.” He also rejected the claim that the majority’s rule would insulate employers from liability for abusive workplaces. The employer can still be held to account for being “negligent in failing to prevent harassment from taking place.”
Justice Thomas concurred to say that he believed that Faragher and Ellerth were wrongly decided, but that he joined the majority opinion because it provides the “narrowest and most workable rule” for implementing those precedents.
Justice Ginsburg again took the lead in dissent. “The limitation the Court decrees,” she wrote, “diminishes the force of Faragher and Ellerth, ignores conditions under which members of the work force labor, and disserves the objective of Title VII to prevent discrimination from infecting the Nation’s workplaces.”
The dissent recognized that the word “supervisor” is not in the statute and was not defined in the Court’s prior cases. But the dissenters believed that the Court had previously used that term broadly to encompass those who “direct subordinates’ daily work.” More importantly to the dissent, the majority’s definition significantly under-protects employees from harassment, the dissent argued, because in the real world, an “employee who confronts her harassing supervisor risks, for example, receiving an undesirable or unsafe work assignment or an unwanted transfer.” “Facing such dangers, she may be reluctant to blow the whistle on her superior.” The dissent includes a list of lower court cases illustrating horrible acts of harassment by people who exercise significant power over the day-to-day lives of their subordinates yet did not have the power to unilaterally take tangible employment actions under the majority’s definition.
The negligence standard the majority leaves such workers, Justice Ginsburg opined, is inadequate. “Recall that an employer is negligent . . . only if it knew or should have known the conduct but failed to take appropriate corrective action.” But, the dissent believed, employees often are deterred or have little opportunity to bring such acts to their employer’s attention, effectively immunizing the employer from liability.
Both of today’s decisions are undoubtedly wins for employers. In fact, the Court in Vance adopted a rule that was even more employer-friendly than the employer had asked for in that case (see Lyle’s preview here). Both decisions will make it harder for plaintiffs to prove their cases, but perhaps more importantly, will provide judges greater authority to prevent the case from getting to a jury in the first place. That both reduces the cost and complexity of fighting many discrimination claims, and also reduces the settlement value of many others.
In both of today’s cases, I think it is fair to say that neither the text of the statute or the Court’s prior decisions conclusively resolved the question one way or the other. In resolving that ambiguity, it perhaps is not surprising that the Justices would be divided along lines of world view – those who believe that many Title VII claims are meritless and impose unfair costs on employers will naturally be attracted to rules that make it harder for those cases to proceed to trial; those who think that the work of Title VII is far from finished will fear that the restrictive rules adopted today will allow discrimination to continue to a greater degree than under the legal rules rejected.
As noted at the beginning of this post, how to best strike that balance has been a question subject of a long-running conversation between the Court and Congress.
In both cases today, Justice Ginsburg ends her dissents with a call to Congress to intervene once again and overrule the majority, citing as an example Congress’s overruling of the Court’s decision (written by Justice Alito, over Justice Ginsburg’s dissent) in Ledbetter v. Goodyear Tire & Rubber, as well as the 1991 Act construed in Nassar.
Disclosure: Goldstein & Russell, P.C., whose attorneys work for or contribute to this blog in various capacities, is among the counsel to Representative F. James Sensenbrenner et al., who filed an amicus brief in support of the respondent in this case.
Disclosure: The law firm of Goldstein & Russell, P.C., whose attorneys work for or contribute to this blog in various capacities, was among the counsel on an amicus brief in support of the university in Fisher. The law firm of Howe & Russell, P.C., a predecessor to Goldstein & Russell, P.C., represented petitioner Lilly Ledbetter in the Ledbetter v. Goodyear Tire & Rubber Co.