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February 18, 2011

Effect of Thompson v. North American Stainless, LP - Employers Now Likely to Face Third Party Retaliation Claims

On January 24, 2011, the U.S. Supreme Court issued a unanimous decision which held that an employee can assert a retaliation claim under Title VII of the Civil Rights Act of 1964, as amended ("Title VII"),1 even if he or she does not directly engage in a "protected activity" (e.g., complaints of workplace discrimination or harassment). In effect, the Court's decision expands Title VII's anti-retaliation provision to cover, in some circumstances, claims brought by third parties.

In Thompson v. North American Stainless, LP, North American Stainless ("North American") employed both Eric Thompson and his fiancée, Miriam Regaldo. In October 2002, Regaldo filed a charge with the Equal Employment Opportunity Commission ("EEOC") alleging she was discriminated against because of her gender in violation of Title VII. In March 2003, three weeks after the EEOC notified North American that Regaldo filed a charge, North American terminated Thompson from employment. As a result, Thompson, who did not take part in any protected activity on behalf of himself or his fiancée, filed a charge with the EEOC alleging that his termination was in retaliation for his fiancée's EEOC charge in violation of Title VII.

After the EEOC found "reasonable cause" to believe that North American terminated Thompson in retaliation for his fiancée's protected activity, Thompson filed suit against North American in the Eastern District of Kentucky. North American responded by challenging Thompson's right to sue, claiming that he lacked standing under Title VII and arguing that there was no cause of action under Title VII for retaliation against associated third parties who had not, themselves, engaged in protected activity. The District Court agreed with North American, concluding that Thompson did not fit within the class of persons Congress intended to protect because he failed to engage in a protected activity under Title VII. On appeal, the U.S. Court of Appeals for the Sixth Circuit affirmed the District Court's holding. Thompson then appealed to the United States Supreme Court.

Reversing the Sixth Circuit decision, the Supreme Court held that: 1) if the facts alleged by Thompson were true, the termination of Thompson constituted unlawful retaliation under Title VII; and 2) Title VII granted Thompson, as a third-party, a cause of action to sue for retaliation.

The Court first held that North American's termination of Thompson violated Title VII's anti-retaliation provision which "prohibits any employer action that "˜well might have dissuaded a reasonable worker from making or supporting a charge of discrimination.'" Based on this principle, originally set forth by the Court in Burlington N. & S.F.R. Co. v. White, 548 U.S. 53 (2006), the Court concluded that it is "obvious that a reasonable worker might be dissuaded from engaging in protected activity if she knew that her fiancé would be fired."

The Court additionally held that Thompson had standing to bring a retaliation claim under Title VII. Title VII itself allows a civil action to be brought by the person claiming to be aggrieved. The Court held that Thompson was an "aggrieved" party because he was fired as a means to harm his fiancée for filing an EEOC charge alleging discrimination against North American. Therefore, Thompson "falls within the "˜zone of interests' sought to be protected by [Title VII]."

The Court declined to identify a fixed class of relationships "for which third-party reprisals are unlawful." However, it observed that "firing a close family member will almost always" constitute actionable retaliation, but that "inflicting a milder reprisal on a mere acquaintance will almost never do so."

Guidance for Employers

The Court's ruling compounds the uncertainty surrounding the scope of Title VII's anti-retaliation provisions --"‘ begging question of how far a relationship can extend before an adverse employment action is too attenuated from a protected activity to be considered retaliation. Undoubtedly, attorneys who represent Title VII plaintiffs will test the limits of this recent ruling. Therefore, employers must carefully evaluate whether disciplinary actions might be construed as a response to conduct by someone related to or closely associated with the affected employee.

When in doubt, contact your employment law counsel.

If you have any questions or require our assistance in reviewing your policies or conducting management training, please contact the Hiscock & Barclay lawyer with whom you normally work or any attorney in our Labor & Employment practice area.

1 Title VII prohibits discrimination, harassment and retaliation in the workplace based on an individual's race, color, religion, sex or national origin.


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