Sharp Increase in Retaliation Claims May Result From Supreme Court Ruling

A recent ruling by the U.S. Supreme Court makes it easier for employees to assert claims of illegal retaliation in the workplace.  The case involved an employee who claimed retaliation when she was reassigned to a more arduous job and suspended for 37 days without pay after she complained to company officials about her supervisor’s sexual harassment.  The unanimous decision means employers must be extra cautious in taking any action against an employee who has filed a discrimination or retaliation claim under Title VII of the Civil Rights Act.

Background

Shelia White was a forklift operator for the Burlington Northern and Santa Fe Railway Company and the only female working in her department.  She complained to company officials about her supervisor’s comments, including repeatedly telling her that women should not be working in that department and making insulting and inappropriate remarks to her in front of her male coworkers.  After an investigation, the supervisor was suspended and ordered to attend sexual harassment training.  White was reassigned to a previous position she had held as a track laborer, a more physically demanding and “dirtier” position.  Her pay and benefits remained the same.

White filed an EEOC charge because of the reassignment and a short time later, after an incident with a different supervisor, she was suspended for 37 days without pay for insubordination.  A subsequent internal investigation and hearing determined that she had not been insubordinate and should not have been suspended.  White was reinstated with full back pay.

A jury returned a verdict in White's favor on the retaliation claim and awarded her $43,000 in damages.

Materially Adverse Action

The question before the Supreme Court on Burlington Northern’s appeal was whether White’s assignment to a less desirable job (with same pay and benefits) and the 37 day suspension (although she received back pay) would be considered a “materially adverse” employment action likely to be perceived as retaliatory and thus discouraging employees from filing discrimination claims.

A number of lower courts have addressed the issue of what employment action is considered retaliatory.  Some courts said the action had to be directly related to an ultimate employment decision such as hiring, firing or compensation.  Other courts adopted a more lenient approach and ruled that any adverse treatment in the workplace against a complaining employee could be considered retaliatory.

The Supreme Court ruled that the alleged retaliatory action did not have to directly affect a term or condition of employment.  The Court noted that an employer can effectively retaliate against an employee by taking actions not directly related to his employment or by causing her harm outside the workplace.  In addressing the extent of harm the person complaining of retaliation must show, the Court held that an individual must show that a reasonable employee would have found the challenged action materially adverse, which means it might have dissuaded a reasonable worker from making or supporting a charge of discrimination.

Applying this standard, the Court found that White’s assignment to a less desirable job and her suspension without pay for 37 days constituted unlawful retaliation that would discourage an employee from bringing discrimination charges.  Even though White received back pay for the 37 days, the suspension was deemed retaliatory because “many reasonable employees would find a month without a paycheck a serious hardship.”

The Court emphasized that challenged action must be materially adverse, not trivial.  "An employee's decision to report discriminatory behavior cannot immunize that employee from those petty slights or minor annoyances that often take place at work and that all employees experience."  An example of a petty slight would be not being invited to go out to lunch with fellow workers.  However, being excluded from lunch could be materially adverse treatment if the lunches were weekly sessions where significant business or training was conducted.

In its ruling, the Court also noted that context was important in determining whether an employer’s actions were materially adverse.  For instance, a shift or schedule change may not have an adverse impact for many employees but for a young mother with school-age children it may matter enormously.

Employers Beware

Several aspects of the Court’s decision may place a major burden on employers:

• the fact that the alleged retaliatory action can occur outside the workplace;

• the use of the “reasonable employee” standard in determining if an action is considered retaliatory; and

• having to be familiar with an employee’s individual circumstances to know if an employment action is retaliatory in context.

The imprecise nature of the standards set by the Court in determining retaliatory conduct almost guarantees a flood of lawsuits claiming that certain action by the employer constituted illegal retaliation.

So what should an employer do?  As always, make sure your employee handbook and supervisor manuals expressly forbid retaliation against those reporting discriminatory conduct and that they require employees to promptly report any perceived retaliatory actions.  Require supervisors to consult with Human Resources or management before taking any potentially adverse action against an employee who has complained about discrimination or harassment in the past.  Under the Burlington Northern ruling, potentially adverse action could include such things as transfers, schedule changes, or altering job duties, in addition to disciplinary action, demotions and terminations.  If discipline or termination of an employee who has recently filed discrimination charges is warranted, make sure the grounds are well documented, objective, consistent with past practice, and based on legitimate employment concerns.

Employers may feel they must now “walk on eggshells” around employees who have previously claimed discrimination, afraid to alter anything in the workplace situation lest it be considered materially adverse treatment of the complaining employee.  This is an exaggeration but employers and supervisors must understand that retaliation lawsuits will likely become more frequent as courts and juries interpret the Burlington Northern case.  The Court’s opinion indicates that the determination of whether employment action is retaliatory or materially adverse will depend on the individual facts in each particular instance.  Preventing retaliation claims will require vigilance on the part of management and education of supervisors to avoid providing employees with any ammunition for such a suit.