April 20, 2011

Client Alert

Employers should take note of a recent decision by the United States Supreme Court that opens the door for third parties to bring retaliation claims when an employer takes an adverse action against an employee. The unanimous decision endorsed a broad reading of the anti-retaliation provision of Title VII of the Civil Rights Act of 1964.

In so doing, however, the high court has left employers to determine which employees may have close enough personal relationships to be affected by an employer’s actions.

Zone of Interests

On January 24, 2011, the high court ruled in Thompson v. North American Stainless, LP that the “zone of interests protected by Title VII” extends to a close third-party such as a family member or a fiancée even if that person did not engage in “protected activity.”

In Thompson, the plaintiff, Eric Thompson, and his fiancée were both employed by North American Stainless (“North American”). Mr. Thompson’s fiancée filed a sex discrimination charge against North American with the Equal Employment Opportunity Commission (“EEOC”). Three weeks after the filing of that charge, North American fired Mr. Thompson. In response, Mr. Thompson filed a charge with the EEOC alleging retaliation under Title VII, and he subsequently sued North American.

The District Court for the Eastern District of Kentucky granted summary judgment for North American reasoning that Title VII does not contemplate third-party retaliation claims. In so deciding, the District Court held:

The Court recognizes that retaliating against a spouse or close associate of an employee will deter the employee from engaging in protected activity just as much as if the employee were himself retaliated against. But, the Court also finds persuasive the reasoning that Title VII already offers broad protection in such situations by prohibiting employers from retaliating against employees who oppose unlawful employment actions or who participate in any manner in a proceeding under Title VII.

The United States Court of Appeals for the Sixth Circuit (en banc) affirmed.

Protected Activity

Without addressing the merits of Mr. Thompson’s claim, the Supreme Court found that that his fiancee’s act of filing a charge with the EEOC constituted “protected activity” under Title VII. The Supreme Court then considered whether the Sixth Circuit erred in holding that a retaliation claim could not be brought by an individual who did not engage in the underlying protected activity. The Supreme Court found that if North American fired Mr. Thompson to retaliate against his fiancée, then he had the right to sue under Title VII.

The Supreme Court reasoned that Title VII’s anti-retaliation provision “prohibits any employer action that well might have dissuaded a reasonable worker from making or supporting a charge of discrimination.” Title VII provides that “a civil action may be brought … by the person claiming to be aggrieved.” The Supreme Court found that an “aggrieved” person is one who “falls within the zone of interests sought to be protected by the statutory provision whose violation forms the legal basis for his complaint.”

The Supreme Court further found that “Thompson was an employee of [North American], and the purpose of Title VII is to protect employees from their employers’ unlawful actions.”

While the Supreme Court’s decision in Thompson opened the door to third-party retaliation claims, the Court declined to identify a fixed class of relationships for which third-party reprisals are unlawful. Rather, the Court endorsed a case-by-case analysis of the objective harm to a Title VII complainant caused by a third-party reprisal to assess whether that reprisal constitutes retaliation under Title VII. The Court advised that "firing of a close family members will almost always meet the . . . standard, and inflicting a milder reprisal on a mere acquaintance will almost never do so . . ."

In a concurring opinion, Justices Ginsberg and Breyer emphasized that the EEOC has long stipulated that Title VII prohibits retaliation against close associates of a person seeking to file a discrimination complaint.

Going Forward

This decision is significant to employers because it opens the door to third-party retaliation claims under Title VII. Further complicating the situation is the fact that employers are not always in the best position to know who is in a “close personal relationship” with whom. Employers can reduce their exposure to third-party Title VII claims by adopting and enforcing an anti-nepotism policy in their workplaces. Such policies generally limit or restrict employees, who are associated by blood, marriage, adoption or cohabitation, from working together in the same workplace.

Employers that have a concern about how to take an adverse employment action for legitimate business reasons against an employee who is in a close personal relationship with a Title VII complainant should seek legal counsel to review the underlying circumstances to determine how best to proceed. In addition, employers should consider consulting employment counsel to assess their employee termination procedures and to review or to add an anti-nepotism policy to their employment handbooks.

About Hill Wallack LLP

Hill Wallack LLP has built a reputation for problem-solving and aggressive advocacy. With offices in Princeton and Atlantic City, N.J., and Yardley, Pa., the firm has comprehensive commercial capabilities and deep experience in a number of industry sectors. Our attorneys have extensive government experience, and the firm represents businesses and public entities in many areas in which public and private interests intersect.

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For more information, contact one of the attorneys who work in this area:

In New Jersey:

Rocky L. Peterson, Esq.,  Suzanne M. Marasco, Esq., Dana M. Lane, Esq., Christina L. Saveriano, Esq., Kenneth A. Skroumbelos, Esq., Susan L. Swatski, Esq.,

In Pennsylvania:

Joanne Rathgeber, Esq., Tiffanie C. Benfer, Esq., Carolyn M. Plump, Esq.,

This article provides information of general interest and is not intended, and should not be used, as a substitute for consultation with legal counsel. Any questions regarding the specific issues raised in this article should be directed to the authors or to your contacts at Hill Wallack LLP.