Supreme Court Creates New Test Under Title VII for Employee Transfers

Supreme Court Creates New Test Under Title VII for Employee Transfers

Today, in a 6-3 opinion in Muldrow v. City of St. Louis, the Supreme Court created a new standard under Title VII for employee transfers, rejecting any heightened harm requirement – such as materiality or significant disadvantage – that lower courts have applied.  However, the Court did not go so far as to adopt the Petitioner’s proposed rule in the case which would have found any transfer, regardless of harm would be actionable under Title VII if based on a protected characteristic.  Instead, the Court compromised, and concluded that Title VII’s text requires “some harm” in a forced transfer suit.  Where exactly is the line between “some harm” and “material” harm is not entirely clear, though the Court does provide several examples from case law in lower courts of what would qualify in its opinion.

In this case, a newly appointed police commissioner for the City of St. Louis transferred twenty-three police officers.  Sgt. Muldrow was one of these officers. She was transferred out of the Intelligence Division, where she investigated human trafficking and public corruption and oversaw the Gang Unit to the Fifth Division.  Her pay and rank remained the same with the transfer, but the new job was less prestigious, and she could no longer wear plain clothes.  In addition, her schedule changed from weekdays only to a rotating schedule involving some weekends and she also lost access to a FBI unmarked vehicle she had with the Intelligence Division.

She sued, claiming her transfer was based on her sex in violation of Title VII.  Title VII makes it unlawful for an employer “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, because of such individual’s race, color, religion, sex, or national origin.” §2000e–2(a)(1).  The Eighth Circuit held that Sgt. Muldrow could not demonstrate the transfer resulted in a “materially significant disadvantage” because her pay, benefits, and rank remained the same.

In an opinion authored by Justice Kagan, the Supreme Court vacated the judgment, concluding that the text of Title VII does not require a heightened harm showing.  The Court noted that whether the lower courts were requiring a “material disadvantage” or a “significant disadvantage” those approaches were all incorrect.  Instead, under the new test, an employee “must show some harm from a forced transfer” that harm just need not rise to the level of “serious” or “significant.”  The Court explained that the term “discriminate against” in the language of the statute refers to “differences in treatment that injure” or “practices that treat a person worse” because of a protected trait.  To add the word “significant” would be imposing a requirement that Congress did not write into the statute.  Additionally, the Court explained that the words “terms or conditions” in the statute are used, not in the “narrow contractual sense” but instead are meant to encompass “more than the economic or tangible.”

In response to a concurrence in the judgment, the Court’s majority explained the sweeping nature of its ruling, noting this new standard “changes the legal standard used in any circuit that has previously required ‘significant,’ ‘material,’ or ‘serious’ injury.”  The Court noted its holding “lowers the bar Title VII plaintiffs must meet” and “because it does so, many cases will come out differently.” The Court also provided several examples of cases from lower courts which had applied a heightened harm threshold which would come out differently under the Court’s new test.

The Court rejected the City’s arguments about text, precedent in the context of an anti-retaliation case, and policy. In terms of policy, the City argued that courts would be flooded with lawsuits if a lower standard is applied.  The Court explained that is a problem for Congress, not the Court.

Finally, in terms of Sgt. Muldrow herself, the Court concluded that if her allegations are true, she meets the Court’s new test “with room to spare.”  However, the Court noted that she may have forfeited arguments about her schedule and the unmarked car and there may be other proof issues in the case, and thus remanded to the lower court to reexamine the case in light of the new standard.

Justice Alito concurred in the judgment only, calling the majority opinion “unhelpful” and noting he has “no idea” what the test requiring some harm or injury but not “significant” or “substantial” harm means.  In Justice Alito’s view, there is little difference between the lower court’s “substantial harm” test and the majority’s “harm” test and lower court judges “will continue to do pretty much just what they have done for years.”

Justice Kavanaugh meanwhile also concurred in the judgment only as he would not have required any showing of harm.  Although Justice Alito believes the majority’s test is virtually the same as the test employed by lower courts applying a materiality standard, Justice Kavanaugh believes the majority’s “some harm” threshold is “a relatively low bar.”  And he therefore believes his no harm test would be the same as the majority test in 99 out of 100 cases, if not all 100.

The Local Government Legal Center filed an amicus brief in this case authored by IMLA legal staff: Amanda Karras, Erich Eiselt, Deanna Shahnami, and Ravinder Arneja.  In that brief, the LGLC argued that adopting the rule advocated by the petitioner that any transfer is actionable under Title VII if based on a protected characteristic would have profound policy implications for local governments in the context of public safety and budgets.  The brief advocated for maintaining the materiality requirements required in most circuits.  While that position was rejected by the Court, the fact that the Court did not adopt the Petitioner’s argument either means local governments will retain some ability to weed out unmeritorious claims in this area.  But local governments should examine policies surrounding employee transfers and ensure that proper training is conducted to avoid liability in this area.  Only time and litigation in this area will tell us whether Justice Kavanaugh or Justice Alito was correct in terms of how this new test will be applied.

To read the Court’s decision, click here.

To read the LGLC’s amicus brief, click here.