Supreme Court Lowers the Bar for Title VII Discrimination Claims

The U.S. Supreme Court has ruled that adverse employment actions need not be “significant” in order to constitute a violation of Title VII’s prohibition against discrimination. This ruling undercuts decades of court decisions that applied a heightened standard of harm, although recent federal appellate court rulings already showed a trend away from that standard.

Title VII’s Prohibition on Discrimination. Title VII prohibits employers with 15 or more employees “to fail or refuse to hire or to discharge any individual, or otherwise to discriminate against any individual with respect to his compensation, terms, conditions, or privileges of employment” on the basis of race, color, religion, sex (including sexual orientation and gender identity) and national origin.

In order to establish a discrimination claim under Title VII, courts have held that an employee must show, among other things, that they suffered some “adverse employment action.” Traditionally, this has been interpreted to mean some significant harm, using terms such as “ultimate employment decision,” “materially adverse,” “serious harm,” and other similar language. This typically involved actions having a direct economic impact, such as a failure to hire, a denial of promotion or salary increase, or a termination. In recent years, however, the U.S. Courts of Appeals for the Second, Fourth, Fifth, Sixth, Ninth, Eleventh and D.C. Circuits have backed away from an “ultimate employment decision” standard.

Background of the Case. In Muldrow v. City of St. Louis, Missouri, At the request of the new head of the division, a female policy officer was transferred out of the unit so he could replace her with a male officer. Although her rank and pay remained the same, her responsibilities, perks and schedule were changed – offering her less interaction with high-ranking officials, loss of take-home privileges for an official vehicle, and a less regular schedule involving weekend shifts.

The female officer sued, alleging that the transfer to an “administrative” and “less prestigious” role was based on her sex in violation of Title VII. The federal district court held, and the Eighth Circuit agreed, that the officer failed to show, as she was required to do, that the transfer caused a “materially significant disadvantage.” More specifically, the Eighth Circuit asserted that the transfer “did not result in a diminution to her title, salary, or benefits” and had caused “only minor changes in working conditions.” The Eighth Circuit’s decision, however, was contrary to recent decisions from sister Circuits, as noted above.

The Supreme Court’s Decision.  The Supreme Court rejected a heightened standard of harm and held that, with regard to actions other than refusal to hire or discharge, Title VII only requires that a plaintiff show some “‘disadvantageous’ change in an employment term or condition.” Moreover, such terms and conditions cover more than just the economic or tangible.

Critically, the Supreme Court held that a plaintiff does not have to show that the harm was “significant.” The statutory language “discriminate against” simply means to treat worse, and does not specify “how much worse.” Therefore, this language does not establish any heightened standard of harm. The Supreme Court further noted that this decision “lowers the bar” for any plaintiff in Circuits that “previously required ‘significant,’ ‘material,’ or ‘serious’ injury.”

In reaching this holding, the Supreme Court rejected the argument that the actions invoked by Title VII’s prohibition on “otherwise to discriminate” must be similar in degree to “to fail or refuse to hire or to discharge.” The Supreme Court also rejected the argument that its own precedent in Burlington N.&S.F.R. Co. v. White established the significant-harm requirement, noting that White arises under Title VII’s anti-retaliation provision (prohibiting an employer from taking adverse action against an employee for bringing or assisting with a Title VII charge), which uses a different standard.

The Supreme Court also addressed the concern that this ruling would open the floodgates to discrimination claims. It asserted that courts have many ways of disposing of meritless Title VII claims. But even if these fears were to come to pass, that would be the result of the statute as passed by Congress, and it is not the Supreme Court’s role to modify that intent to achieve some other desired result.

Lessons for Employers. Employers should understand that the traditional discrimination landscape is changing, and that they may now face liability under more relaxed standards. Job transfers, as well as other employment actions like denial of training opportunities, scheduling, and discipline could rise to the level of discrimination if the employee can demonstrate that they suffered some harm to a term, condition or privilege of employment. It is important for employers to ensure that their policies are not discriminatory, even if they arguably do not result in “significant” harm to an employee.