Friday, December 10, 2010

Supreme Court Hears "Employee-Relationship" Retaliation Case

The U.S. Supreme Court heard oral arguments earlier this week in a case that could impact how courts and HR managers define "employee retaliation" under federal anti-discrimination laws. The facts underlying the case, Thompson v. North American Stainless LP, began approximately 13 years ago when Eric Thomspon was hired by North American Stainless (the "Company"). The Company hired Miriam Regalado three years later. The two Company employees soon entered into a relationship, and eventually were engaged to be married. In February 2003, Regalado sued the company, alleging gender discrimination. Three weeks after the Company became aware of Regalado's lawsuit, the Company fired Thompson. Thompson subsequently filed suit in the U.S. District Court for the Eastern District of Kentucky, arguing that he was wrongfully terminated under Title VII of the Civil Rights Act of 1964. The court dismissed his complaint, holding that Title VII doesn't permit claims based upon of third-party retaliation. The U.S. Court of Appeals for the Sixth Circuit affirmed the lower court's decision, and the U.S. Supreme Court eventually agreed to hear the case.

At oral argument, the Supreme Court appeared reluctant to extend its retaliation jurisprudence, and the protections of Title VII's retaliation provisions to such third-party relationships. "Put yourself in the shoes of an employer," said Justice Samuel A. Alito, Jr.. "You want to take an adverse employment action against Employee A. You think you have good grounds for doing that, but before you do it, you want to know whether you're potentially opening yourself up to a retaliation claim." He continued, noting the implausibility of opening up a claim of retaliation for every kind of employee relationship. "Does the employer have to keep a journal on the intimate or casual relationships between all of its employees, so that it knows what it's opening itself up to when it wants to take an action against someone?" The court also debated what kind of relationships would count—a spouse? A friend? A pal? "Can you help provide where the clear line is?" asked Justice Alito. "Does it include somebody who just has lunch in the cafeteria every day with the person who engaged in the protected conduct? Somebody who once dated the person who engaged in the protected conduct?" Thompson's counsel argued the relationship in this case was strong enough to warrant a claim of retaliation. "The reason the relationship is important in this case is because it tends to render plausible the argument that there's a causal connection between the adverse action visited on Thompson in this case." The Company's counsel maintained the line of reasoning that had defeated Thompson in the lower courts. It asserted that the court's previous rulings show that Title VII does not cover third-party employee retaliation, and that because Thompson did not engage in "protected conduct" (i.e. he himself allegedly had not discriminated against), he did not have standing to sue the Company.

Although the Supreme Court appears from its questioning at the oral argument to be reluctant to extend the protections of Title VII's retaliation provisions to Thompson in this case, the case would have far-ranging legal implications for employers and employees if Thompson were to prevail. If Thompson wins, employees who are fired could gain a legal foothold when arguing they were terminated because of retaliation for another employee's behavior.