In what appears to be an emerging trend upending years of precedent, the Fifth Circuit Court of Appeals has now suggested that Title VII employer liability could extend to situations where an employee has not been subjected to an “ultimate employment” decision. In two recent decisions, the Fifth Circuit Court of Appeals has said that the plaintiffs in those cases could pursue Title VII disparate treatment claims for discrimination based on the denial of the privileges or terms of employment, such as shift schedules and days off. Below, we briefly examine those two cases and assess their impact on employer liability going forward.
Hamilton v. Dallas County, No. 21-10133 (5th Cir. 2023)
This case arose from a scheduling practice employed by the Dallas County Sheriff's Department that was based on sex. In April 2019, the County adopted a policy that only allowed male officers to have a full weekend off. Female officers could only receive weekdays and/or partial weekends off. It was undisputed that the male and female officers performed the same tasks on the job. Prior to the implementation of this policy, the officers received preferred days off based on seniority. The County admitted that the policy was based on the sex of the employees. Nine female officers brought a claim against the County claiming that the sex-based policy was discriminatory and in violation of Title VII of the Civil Rights Act, 42 U.S.C. §§ 2000 et seq. They also filed a claim pursuant to the Texas Employment Discrimination Act, Tex. Lab. Code §§ 21.001 et. seq.
The County filed a motion to dismiss, which the district court granted. It reasoned that an adverse employment action under Title VII required an "ultimate employment decision such as hiring, granting leave, discharging, promoting, and compensating." Substantial precedent supported this conclusion. Based on this, the lower court ruled that issues with an employee's work schedule did not rise to the level of an “ultimate employment” decision.
On appeal, the Fifth Circuit reversed the lower trial court, relying on: (1) the text of Title VII and (2) prior decisions that resulted in unfair outcomes to employees.
Title VII, Section 703(a) provides, "It shall be an unlawful employment practice for an employer to:
- Fail or refuse to hire or discharge any individual, or otherwise to discriminate against any individual with respect to his compensation, terms, conditions or privileges of employment, because of such individual's race, color, religion, sex. or national origin; or
- To limit, segregate, or classify his employees or applicants for employment in any way which would deprive any individual of employment opportunities or otherwise adversely affect his status as an employee, because of such individual's race, color, religion, sex or national origin."
Focusing on the text of the statute, the Court decided that Congress did not intentionally limit Title VII liability to ultimate decisions because the purpose of the statute was to eliminate disparate treatment generally. For instance, the statute specifically says that it is against the law for an employer to discriminate against an employee with respect to the "terms, conditions, or privileges of employment."
The Court also highlighted prior decisions that resulted in unfair outcomes to employees who were in fact discriminated at work, but could not pursue remedies because they were not fired. For instance, the Court took issue with the decision in Peterson v. Linear Controls, Civil Action No. 16-00725 (W.D. La. Sep. 5, 2017) in which the district court ruled that black employees who worked outside in the heat and without access to water while their white counterparts were not subjected to the same conditions, were not protected by the provisions of Title VII because this did not qualify as an "ultimate employment decision."
Finding that the text of Title VII would not bar the plaintiffs’ claims, the Court found that the plaintiffs sufficiently plead that they suffered adverse employment actions because they were subjected to a sex-based policy that was used to determine shifts and days off.
Narayanan v. Midwestern State University, No. 22-11140 (5th Cir. 2023)
This case found that a professor could pursue his race bias case against a Texas university after his request to teach summer courses was denied. In reaching its decision, the Fifth Circuit confirmed that it had expanded Title VII liability to instances where an employee has not technically suffered an “ultimate employment” decision. The court stated, “Title VII requires a broader reading than our ultimate employment decision line of cases permitted.” It also pointed to the claimant’s lost income as evidence of an ultimate employment decision as it related to the “terms, conditions, or privileges of employment if that lost income can be shown to be a significant source of income.”
Here the professor’s income from teaching at the university was a significant source of his income and the Fifth Circuit said that the District Court should have considered this in its analysis of the professor’s claims.
It remains to be seen whether these decisions from the 5th Circuit will gain traction elsewhere in the Country. But employers in Mississippi, Louisiana, and Texas, should more closely scrutinize decisions that don’t necessarily result in employee separation or demotion. Decisions that impact employee schedules or requests for days off, for instance, could expose employers to Title VII liability. If you have any questions about the impact of these decisions, please reach out to the labor and employment team at Wood, Smith Henning & Berman.