Employment Law Update
Pending Before the Supreme Court: When Can Employers Be Held Liable for the Biases of Individuals Other Than Decision-Makers
The United States Supreme Court recently granted certiorari to decide the circumstances under which an employer may be held liable for a manager’s bias when a different manager who was the actual decision-maker with respect to an adverse employment action harbored no such views. The Supreme Court’s ruling in this case will shed light on the following two scenarios: (1) where a biased subordinate without decision-making authority exerts
The Seventh Circuit has denied employer liability where — despite allegations that the employer’s vice- president made discriminatory remarks
the decision to terminate the
employee’s employment was made by a lower-level manager, with the vice- president playing no role in the events leading up to the termination other than to approve the manager’s decision.
influence over a non-biased manager’s decision, and (2) where an unbiased manager makes an adverse employment decision, but a more senior manager, playing no role in making the adverse employment decision, displays discriminatory animus towards the affected employee.
In BCI Coca-Cola Bottling Co. of Los Angeles v. EEOC, 450 F.3d 476 (10th Cir. 2006), the EEOC filed a lawsuit on behalf of an employee. The EEOC alleged that while the human resources representative who terminated the employee was unaware of his race, her decision was nonetheless discriminatory as she allegedly was influenced by the racial bias of a subordinate district manager. The Tenth Circuit Court of Appeals held that to prevail on a subordinate bias claim, a plaintiff must show that “the biased subordinate’s discriminatory reports, recommen- dation, or other actions caused the adverse employment action.” Additionally, the Tenth Circuit held that an employer can avoid subordinate liability by conducting
an independent investigation concerning the issues leading to the termination of the employee’s employment. The court ruled that the human resources representative’s cursory review of the affected employee’s personnel file without speaking to him directly about the incident did not constitute a proper investigation.
Other courts of appeals have set forth different standards with respect to this issue. Similar to the standard announced by the Tenth Circuit, the Seventh Circuit Court of Appeals finds liability for subordinate bias only where the information provided by the subordinate caused the adverse employment decision. See Lust v. Seal , Inc., 383 F.3d 580 (7th Cir. 2004). The Seventh Circuit has also denied employer liability where — despite allegations that the employer’s vice-president made discriminatory remarks — the decision to terminate the employee’s employment was made by a lower-level manager, with the vice-president playing no role in the events leading up to the termination other than to approve the manager’s decision. See Luks v. Baxter Healthcare Corp., 467 F.3d 1049 (7th Cir. 2006). The Fourth Circuit Court of Appeals permits liability where the subordinate possesses so much influence over the decision-maker that the subordinate was the one principally responsible for, or the actual decision-maker behind, the employment action. Hill v. Lockheed Martin Logistics Mgmt., Inc., 354 F.3d 277 (4th Cir. 2004).
The most employee-friendly standard has been set forth by the Fifth Circuit Court of Appeals. The Fifth Circuit establishes liability where a biased employee may have influenced the adverse employment decision. See Russell v. McKinney Hosp. enture, 235 F.3d 219 (5th Cir. 2001).
Employers should pay close attention to the United States Supreme Court’s upcoming resolution of this issue. The Court’s decision will establish the applicable legal standard with respect to when an employer may be held liable for the biases of a non-decision-maker. The Court’s decision will also likely provide guidance for employers to take affirmative steps to ensure that apparently non- discriminatory decisions are not infected with any bias. ■
Kramer Levin Naftalis & Frankel LLP