Real World Impact: In April, the
Supreme Court issued a decision in Muldrow v. City of St. Louis,
Missouri, lowering the standard that federal courts had
applied for decades on discriminatory transfer claims under Title
VII of the Civil Rights Act of 1964. Among other things, a
discrimination claim requires a certain level of disadvantage to
the employee to survive: the employee must suffer an "adverse
employment action." For a transfer, federal courts have long
held that it must result in a "significant" or
"material" disadvantage to constitute an adverse
employment action. This changed in Muldrow, where the
Supreme Court held transferees need only show "some
harm."
The question, of course, is what the difference is between the new
and old standard. As Justice Alito stated in his concurring opinion
in Muldrow, "I have no idea what this means, and I
can just imagine how this guidance will be greeted by lower court
judges." Over five months later, we explore how.
No Input yet from the Second Circuit:
As the federal court with the highest authority on New York law
after the U.S. Supreme Court, the U.S. Second Circuit Court of
Appeals' interpretation of the Muldrow standard will
be the most important one for New York employers (absent
legislation from Congress or further clarification from the Supreme
Court). However, to date, the Second Circuit is one of the few
circuit courts of appeals that are silent on the matter. Therefore,
for now, New York employers must look to New York federal district
court judges and other circuit courts.
The Bad News: Muldrow may not be Limited to Title VII
Transfers:
Muldrow addressed a discriminatory transfer claim under
Title VII; it did not consider the standard for any other kind of
employment action under any other discrimination statute.
Nevertheless, some New York district court judges and circuit
courts have applied Muldrow's standard to all
employment actions (not only transfers), and to other
discrimination statutes such as the Americans with Disabilities Act
of 1990, Age Discrimination in Employment Act of 1967, and Section
1981 of the Civil Rights Act of 1866. That said, New York district
judges have repeatedly indicated that they are waiting for the
Second Circuit to decide whether to limit Muldrow to
transfers.
The Good News: Muldrow has made (Almost) No
Difference:
As discussed in our breakdown of the Muldrow decision, in
their concurring opinions, Justices Alito and Thomas were skeptical
that lower courts would apply the "some harm" standard
any differently than the "material harm" standard. So
far, it appears that they were (mostly) correct.
Even with some federal judges applying Muldrow beyond
transfers and Title VII, the impact has been minimal: Sure, New
York district court judges are now split on whether Muldrow opened
the door to consider performance improvement plans and exclusions
from work meetings adverse employment action by definition. Also,
some circuit courts have opined that even suspensions with
pay might constitute adverse employment action under
Muldrow. However, circuit courts and New York district
court judges continue to find that reprimands, exclusions from
social events and trips, and changes in a work schedule or work
location still do not, by themselves, constitute adverse employment
action.
In addition, most federal employment discrimination claims in New
York are brought alongside the more lenient New York State and/or
City Human Rights Laws. Those local statutes already apply a
standard that requires a lesser harm than the traditional federal
adverse employment action standards. Thus, any employment action on
the margins that, for the first time, can proceed for federal
claims after Muldrow, likely already would have proceeded
for analogous New York state or city claims.
The Bottom Line
Thus far, there appears to be little fallout after the Supreme Court in Muldrow lowered the federal standard for certain discrimination claims. For the most part, federal judges are deciding cases the same way that they did before. We will keep you advised of any new developments. In the interim, New York employers should be careful to document the legitimate non-discriminatory business reasons behind transfers, performance improvement plans, suspensions without pay, and other arguably adverse employment actions.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.