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July 30, 2014

The Supreme Court Narrows Employer Liability for Retaliation and Harassment

On June 24, 2013, the United States Supreme Court decided two important employment discrimination cases under Title VII of the Civil Rights Act: University of Texas Southwestern Medical Center v. Nassar; and Vance v. Ball State UniversityIn both cases, the Supreme Court ruled 5-4 in favor of the employer. Nassar raises the bar for plaintiffs to prove Title VII retaliation claims. Vance narrowly defines “supervisor” under Title VII and therefore limits when an employer will be strictly liable for an employee’s harassing conduct.

Nassar

The proper standard of causation in retaliation claims is particularly significant because such claims are increasingly prevalent. In fact, as the Supreme Court noted in Nassar, the number of retaliation claims filed with the Equal Employment Opportunity Commission has nearly has doubled in the last 15 years.

In Nassar, a physician of Middle Eastern descent and Muslim faith, sued a university hospital, claiming retaliation under Title VII. Title VII prohibits an employer from retaliating against employees for engaging in a protected activity, such as complaining about harassment in the workplace. Nassar claimed the hospital withdrew his job offer for a staff physician position after he had complained about harassment by a supervisor based upon his religion and ethnic heritage. The hospital argued that it had other legitimate reasons for withdrawing Nassar’s job offer (including that only faculty members were supposed to be employed as staff physicians and Nassar had resigned from his faculty position). After the Fifth Circuit Court of Appeals held that Nassar need only show that the unlawful retaliation was a motivating factor for his withdrawn job offer to prove his retaliation claim, the Supreme Court agreed to hear the case to determine the proper legal standard for Title VII retaliation claims.

The Supreme Court ruled that plaintiffs bringing Title VII retaliation claims must prove that the employer would not have taken the adverse employment decision (e.g., termination, demotion) against the employee if the employee had not complained of unlawful discrimination. This is the “but for” causation standard —“but for” the employee’s complaint about the unlawful discrimination, the adverse employment action would not have occurred.

Notably, in reaching its decision, the Court determined that the “motivating factor” standard, which is used in Title VII “status-based” (e.g., sex, race, religion) discrimination claims, does not apply to retaliation claims. The motivating factor standard is a lower standard for plaintiffs to meet — requiring a showing only that the discrimination was a “motivating factor” for the adverse employment action. Conversely, to prove “but for” causation, as the Court ruled inNassar, “requires proof that the unlawful retaliation would not have occurred in the absence of the alleged wrongful action or actions of the employer.” In Nassar, the Court therefore held that plaintiffs must meet a higher standard in Title VII retaliation claims than in Title VII status-based claims.

The Court noted that the stricter causation standard for retaliation claims is practical due to the “ever-increasing frequency” of retaliation claims in the United States. Indeed, the “but for” causation standard may help to deter frivolous retaliation claims and make it easier for employers to prevail on summary judgment motions in retaliation cases.

Vance

In Vance, an African-American employee of Ball State University sued the university, claiming, among other things, that she had been subjected to a racially hostile work environment in violation of Title VII. The Court decided the unsettled question of who qualifies as a “supervisor” in a Title VII claim for workplace harassment. The definition of “supervisor” is significant because an employer is strictly liable for its supervisor’s conduct when the harassment results in a tangible employment action (e.g., termination, demotion). As the Supreme Court noted, when there is no adverse employment action, “an employer can mitigate or avoid liability by showing (1) that it exercised reasonable care to prevent and promptly correct any harassing behavior and (2) that the plaintiff unreasonably failed to take advantage of any preventive or corrective opportunities that were provided.”

The Supreme Court defined a supervisor under Title VII as an employee who is empowered by the employer “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.”’ Because the harassing employee in Vance did not have the power to take such actions, she was not a supervisor and the Court affirmed the decision of the Seventh Circuit Court of Appeals granting summary judgment for the university.

The Supreme Court’s definition of a supervisor narrows employer liability for workplace harassment under Title VII. Now, a supervisor under Title VII is not merely an employee with day-to-day oversight of other employees’ activities; rather, a supervisor is only someone with significant authority, such as an employee who has the power to hire and fire.

Impact of the Decisions

Nassar and Vance narrow the scope of employer liability under Title VII and give employers a greater chance of obtaining summary judgment in certain cases. Nevertheless, employers must continue to take steps to prevent and correct any retaliation and harassment in the workplace to maintain an appropriate work environment and avoid liability under Title VII.

In particular, given the frequency and complexity of retaliation cases, employers should take this opportunity to review and consult with counsel about their policies and practices related to retaliation to help prevent and defend against retaliation claims.

In light of the Supreme Court’s Vance decision, employers should also consider reviewing and consulting with counsel about their employees’ job descriptions to determine which employees fall within the Supreme Court’s definition of supervisor and revise employees’ duties, as appropriate. 

Employers should also ensure that they take proper steps to prevent harassment in the workplace; otherwise, they will be exposed to an argument that they were negligent in preventing harassment by a co-worker. As the Supreme Court stated, “evidence that an employer did not monitor the workplace, failed to respond to complaints, failed to provide a system for registering complaints, or effectively discouraged complaints from being filed would be relevant” to establishing such negligence.

Holly E. Courtney contributed to this article. 

© MICHAEL BEST & FRIEDRICH LLP

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About this Author

daniel a. kaufman, partner, michael best law firm
Partner

Dan Kaufman is the Managing Partner of the Chicago office, Co-Chair of the Class Action/MDL Team and a member of the Labor and Employment Relations and Education Practice Groups, and the Trade Secret Protection and Non-Competition Team. He served on the Management Committee from 2000-2003 and as Managing Partner of the Chicago office from 1996-2000.

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