Employers Could Face More Discrimination Suits

A new Supreme Court ruling makes it easier for workers to sue for on-the-job discrimination.

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A Supreme Court ruling that boosts protections for workers complaining of harassment on the job could result in a flood of discrimination cases  against employers, legal experts and small-business advocates say.

On Thursday, the court unanimously adopted a far broader definition of anti-retaliation provisions under Title VII of the Civil Rights Act of 1964, which, among other things, forbids employers from firing, demoting, or harassing workers who complain  about discrimination on the job.  

Until now, lower courts were split on interpreting employer retaliation. While one side claimed it applied strictly to firing, hiring, and wages, the other extended it to anything related to employment. Generally, such cases are rarely won where an employee hasn't been outright fired.

Yet, under the new ruling, the provision now applies to any "employer actions that would have been materially adverse to a reasonable employee or job applicant," according to the opinion delivered by Justice Stephen Breyer.

"We phrase the standard in general terms because the significance of any given act of retaliation will often depend upon the particular circumstances. Context matters," Beyer wrote.

As such, the ruling "greatly broadens the scope of what can be considered retaliation," said Jill Greene, an associate in the labor and employment group at Powell Goldstein LLP, an Atlanta law firm.

As a result, employees -- and their lawyers -- will be far more likely to pursue retaliation cases under Title VII, she said.

"It's going to make it a lot easier for employees to show they were being retaliated against, and more difficult for employers to know what action they can take that may or may not be considered retaliation," Greene said.

Karen Harned, director of legal issues for the National Federation of Independent Business, a Washington-based small-business lobby, called the ruling "particularly disappointing to small employers."

"Instead of a clear standard as to what constitutes a retaliatory action for Title VII purposes, the court adopted a subjective test which simply means more litigation," Harned said in a statement. 

More than 22,000 cases of retaliation discrimination were filed in 2004 resulting in over $90 million in worker compensation, according to the Equal Employment Opportunity Commission.

The ruling stems from a case involving Sheila White, a fork-lift operator at a railway company, who said she was demoted after complaining about offensive remarks made by her supervisor, court documents show.

While the supervisor was suspended for 10 days and forced to attend sexual harassment therapy sessions, White was taken off the forklift crew and spent over a month on unpaid leave.

After White sued her employer, the Burlington Northern & Santa Fe Railway Company, and was awarded $43,500, the railway company appealed.