Just Because an Employer’s Termination Reason Is False Doesn’t Necessarily Mean It’s Discrimination


Highlighting an interesting point in the analysis of a discrimination claim, the U.S. Court of Appeals for the Fifth Circuit stated that an employee must do more than prove the employer’s asserted justification for termination is false in order to sustain a discrimination claim – there must be evidence that the actual reason was discriminatory.

In a discrimination case without direct evidence of discrimination (such as racist or sexist comments), the McDonnell Douglas burden-shifting framework applies. Under this Supreme Court-established framework, the employee must first establish a prima facie case of discrimination by showing that (1) they belong to a protected group; (3) they were qualified for their position; (3) they suffered an adverse employment action; and (4) a similarly-situated employee outside of their protected group was treated more favorably or, as in this case, replaced them. The burden then shifts to the employer to articulate a legitimate, non-discriminatory reason for the action. And then the burden shifts back to the employee to establish that the employer’s asserted reason is pretext for discrimination.

In Owens v. Circassia Pharmaceuticals, Inc., the employee was terminated and she sued, alleging race and sex discrimination. The Fifth Circuit found she had established a prima facie case, and the employer articulated a legitimate, non-discriminatory reason – poor performance. The Fifth Circuit notes that, while “[m]ere disputes over an employer’s assessment of performance,” including conclusory statements or the employee’s own assessment of her performance, are not sufficient to meet the plaintiff’s burden of showing pretext, in this case, the employee offered objective evidence that the employer’s actions did not “logically comport” with its stated assessment of her performance – i.e. that it was false. “But that alone is not enough. The evidence must permit a reasonable inference that [the employer’s] false reason was pretext for the true, discriminatory reason.” And this showing the employee could not make. The Fifth Circuit quoted the Supreme Court that “there will be instances where, although the plaintiff has established a prima facie case and set forth sufficient evidence to reject the defendant’s explanation, no rational factfinder could conclude that the action was discriminatory.”

Although this was a win for the employer, by no means should employers seek to rely on this argument as a primary defense to a claim of discrimination. Providing a false or illogical reason for an employment action is never a good idea – and with slightly different facts, can easily lead to a viable claim of discrimination. In this case, the employer may well have avoided the significant cost and inconvenience of litigation had it been more thoughtful and logical in its actions and explanations.