Legal Updates

Supreme Court Gives Green Light To Third-Party Retaliation Claims

Retaliation claims against employers – which are already at an all-time high – are likely to skyrocket further as a result of a recent U.S. Supreme Court decision that broadens the universe of potential plaintiffs who are permitted to raise such claims.

Federal law prohibits an employer from retaliating against any employee for engaging in protected conduct (e.g., filing a complaint alleging discrimination).  In Thompson v. North American Stainless, LP, the Supreme Court held for the first time that a third-party who did not engage in protected conduct can nevertheless bring a retaliation claim if he or she is subjected to an adverse employment action as a result of a discrimination complaint made by another employee with whom the third-party has a close relationship.  Significantly, the Supreme Court did not clearly define the scope of third-party retaliation claims, leaving employers with many more questions than answers.

Thompson is of major significance to employers.  The Equal Employment Opportunity Commission (“EEOC”) recently announced that during fiscal year 2010, retaliation claims became, for the first time ever, the most common type of discrimination claim, appearing in 36 percent of all EEOC charges.  In addition, more federal discrimination charges as a whole – nearly 100,000 – were filed against private-sector employers during fiscal year 2010 than in any preceding year.  And this number is likely to increase following Thompson.  Thus, it is vital for employers to be aware of the issues raised by the Court’s holding and to take appropriate steps to prohibit retaliation against all employees, whether they have engaged in protected conduct or not.

Facts

The plaintiff in the case, Eric Thompson, was engaged to a fellow employee of North American Stainless (“NAS”), Miriam Regalado.  In February 2003, NAS learned that Regalado had filed a sex-discrimination charge against NAS with the EEOC.  Three weeks later, NAS terminated Thompson’s employment.

Thompson filed suit against NAS, claiming that the company had violated the federal anti-discrimination law, Title VII, by firing him in retaliation for the discrimination charge brought by his fiancée, Regalado.  A U.S. District Court judge in Kentucky awarded summary judgment to NAS on Thompson’s retaliation claim, holding that Thompson could not maintain such a claim in the absence of a showing that he himself had engaged in some form of protected conduct.  The U.S. Court of Appeals for the Sixth Circuit affirmed this ruling, and then the Supreme Court agreed to review the case.

Supreme Court’s Decision

In an 8-0 decision authored by Justice Scalia (with Justice Kagan not participating), the Supreme Court reversed the lower courts’ dismissal of Thompson’s retaliation claim.  The Court first held that NAS’s firing of Thompson qualified as an adverse employment action for purposes of Title VII.  Noting that a retaliation claim can be founded on any action that “might well have dissuaded a reasonable worker from making or supporting a charge of discrimination,” Justice Scalia concluded that Thompson’s discharge in alleged retaliation for his fiancée’s EEOC charge against NAS easily met this standard.

The second, and “more difficult,” question for the Court was whether, in these circumstances, a retaliation claim could be brought by Thompson, as opposed to Regalado, since only Regalado had engaged in activity protected under Title VII.  The Court decided that Thompson could maintain such a claim, holding that a retaliation claim can be brought by any person falling within the overall “zone of interests” that Title VII was intended to protect, and that Thompson clearly fell within that zone due to his close relationship with Regalado.  Notably, the Court declined to formulate a rule for determining what types of relationships are sufficiently close to meet this standard.  Instead, Justice Scalia indicated that such determinations will need to be made on a case-by-case basis.

Thus, following Thompson, employers are now on notice that Title VII prohibits retaliation against any employee who is in a close relationship with another employee who engages in protected activity.

Recommendations For Employers

Thompson significantly broadens the circumstances in which Title VII retaliation claims can be brought, raising the stakes even more for employers in this ever-expanding area of the law.  We recommend that all employers:

• Ensure that managers, supervisors and human resources personnel understand that any form of retaliation against any employee in response to a discrimination complaint (whether formal or informal) is impermissible;
• Consider revising anti-retaliation provisions of existing policies to clarify that retaliation against any employee is expressly prohibited in any circumstance; and
• Carefully review the situation and consult with legal counsel before terminating or taking other adverse action against any employee who has a close relationship with another employee who has made a discrimination complaint.

Please do not hesitate to contact us if you have questions about Thompson or if we can be of assistance in any way.