Avoiding Liability for Employment Retaliation

Most employers are keenly aware that it is illegal to discriminate against or harass an employee because of the employee's race, religion, sex, age, disability, etc. However, it is also unlawful to take action against an employee because he/she complains about discrimination or harassment, or participates in filing or testifying with respect to such a complaint. Often the retaliation claim is more dangerous than the underlying alleged discrimination, and sometimes a retaliation claim succeeds even though the underlying discrimination claim fails. Employers should beware of retaliation claims and should take steps to protect themselves.

To establish a case for retaliation, an employee must prove that: (1) he/she engaged in protected activity, such as complaining about discrimination or harassment or testifying in connection with their own or another employee's complaint; (2) he/she was subject to employment action which would have been viewed as materially adverse to a reasonable employee; and (3) a causal connection between the protected activity and the adverse action. See Burlington Northern and Santa Fe Ry. Co. v. White, 126 S.Ct. 2405, 2415 (2006). The employer may then articulate legitimate, nondiscriminatory reasons for the action. O'Neal v. Ferguson Construction Co., 237 F.3d 1248, 1252 (10th Cir. 2001). If the employer articulates a legitimate, nondiscriminatory reason, the employee must then prove the action was a pretext and that the real reason for the employment action was retaliation for the protected activity. Id.

The retaliation need not involve the complaining employee's pay, benefits, terms or conditions of employment. In Burlington Northern and Santa Fe Ry. Co. v. White, the Supreme Court held that employment action can be actionable as retaliation if “a reasonable employee would have found the challenged action materially adverse, which … means it well might have dissuaded a reasonable worker from making or supporting a charge of discrimination.” Id. at 2415. In that case, the employee was transferred from a forklift operator position to a position that involved manual labor, such as removing trash and brush and repairing railroad tracks. The Court held that even though her pay, benefits and terms and conditions of employment did not change, the new position itself was viewed by the employees as less desirable than her previous position and upheld the jury's finding of retaliation. Under this recent Supreme Court decision, the scope of adverse action that can support a lawsuit is broader for a retaliation claim than for a discrimination claim.

The employee need not be correct regarding an underlying complaint of discrimination or harassment to succeed on a retaliation claim. As long as the employee has a reasonable belief that the underlying discrimination or harassment occurred, the employer may not retaliate against him/her for complaining. See, e.g., Berg v. La Crosse Cooler Co., 612 F.2d 1041, 1045 -1046 (7th Cir. 1980). This is another reason why retaliation claims may be more dangerous for employers than are the underlying claims of discrimination.

Retaliation claims may arise in other contexts besides employment discrimination and harassment. An employer can be held liable for firing an employee who refuses to engage in illegal conduct. Coors Brewing Co. v. Floyd, 978 P.2d 663, 666-667 (Colo., 1999). Many statutes, such as the Sarbanes-Oxley Act of 2002, OSHA, and the FLSA also have provisions which prohibit retaliation against employees who complain about unlawful conduct.

Some practical steps employers can take to reduce their exposure for retaliation include:

• Have an anti-retaliation policy clearly stating that employees will not be retaliated against for complaining about discrimination, harassment, or other unlawful activity;
• Provide clear mechanisms for complaints and investigations;
• Investigate claims of discrimination and harassment promptly and thoroughly; follow-up with the complaining employee and make sure the issue has been resolved;
• As part of any investigation, be sure to counsel any accused parties that retaliation of any kind is prohibited, and advise the complaining employee to promptly report any further complaints of alleged retaliation or other wrongful conduct;
• Carefully document the reasons for employment action taken with respect to all employees, but particularly those who have complained about discrimination and/or harassment.

Many employment attorneys view retaliation claims as more dangerous than discrimination and harassment claims. However, many employers do not fully appreciate the legal risk of retaliation claims. Awareness and prevention are important. Experienced employment counsel, however, should be consulted with specific or difficult issues and can be extremely helpful in developing and implementing retaliation policies and procedures.