Even if you don’t obsess over legislative and judicial developments the way we do, it has been hard to escape coverage of the Supreme Court’s recent decision in Muldrow v. City of St. Louis, Missouri, et al, regarding the evidentiary standard for plaintiffs bringing a Title VII discrimination claim based not on hiring or firing, or even promotion decisions, but transfers. And the Court’s decision could very well have meaningful implications for federal contractor employers.
Muldrow Case Background:
A Seargent with the St. Louis Police Department alleged that she was transferred because of her sex in violation of Title VII. Her complaint included many particulars describing the “harm” caused by the alleged discrimination, such as loss of prestige, loss of access to higher officials, loss of her FBI clearance and the “take-home” car that came with it, and the loss of her regular schedule that did not generally include working weekends.
But the District Court dismissed the case on summary judgement because the plaintiff had not shown enough harm, or that the harm was substantial enough to trigger Title VII. Summary judgment was upheld on appeal, and Seargent Muldrow found herself headed to the Supreme Court.
What the Court decided surprised a few. They unanimously rejected what they viewed as a “higher standard” for proving a discrimination claim, but they differed quite a bit on what the standard should be, collectively landing on the new “some harm” standard. It was Brett Kavanaugh (not Sotomayor, not Kagan, and not Brown Jackson) who rejected even that standard as too high, noting that when it comes to Title VII cases, the discrimination is the harm, and no further showing of how “bad” it is should be necessary.
OFCCP Enforcement:
We now have a uniform federal standard of proof for Title VII transfer cases, and that is where federal contractors may start to feel some impact beyond the narrow confines of the ruling.
Yes, employers are more vulnerable to transfer discrimination claims in jurisdictions that previously applied the now-rejected higher standard of proof, but that is not unique to federal contractors. The ancillary impact will be from the OFCCP.
Up to this point, courts have been split on the contours of a “transfer claim.” That is likely a major contributing factor to the OFCCP’s general enforcement priorities, which generally do not “look for” transfer issues like they do with hiring, promotion, termination, and compensation. The agency will absolutely process a transfer complaint, but would have to be careful about the standard of proof they apply based on the jurisdiction where the claim was filed. They don’t like to do that.
With a clear standard, however, the OFCCP is not only much freer to pursue transfer complaints but can now look at the extent to which they want to investigate potential transfer issues in audits.
The framework is already there. The OFCCP focuses on hires, promotions, and terminations because those are the “big three” employment transactions you will find at pretty much any employer. They are not limited to those types of employment transactions, however. The Uniform Guidelines require contractors to evaluate their “selection processes,” and that has long been interpreted to include selection (or not) for promotion, and selection for termination.
The argument, “it’s not an employment decision, it’s just moving people around,” never had much merit. And reorganizations, mergers, acquisitions, and regular ol’ transfers can absolutely include prohibited discrimination. Further, Title VII jurisprudence has long recognized “adverse impact discrimination” where an otherwise neutral process (like a reorganization) can nonetheless have an impermissible discriminatory effect.
And unlike LGBTQ+ discrimination, expanding enforcement into the transfer arena does not require the implementation of new self-identification.
Will the OFCCP dive deeper into the murky waters of transfers now that the Supreme Court has swept the path? Time will tell, but a federal law enforcement agency just got a new traffic lane cleared and available for use, and we are not going to bet against them using it.
The OFCCP already complains in audits when terminations from an AAP job group outnumber the people in the job group at the start of the year (because they insist on performing a pretty questionable analysis) and will demand “transfer summaries” to reconcile the numbers. When they start asking for transfer summaries as a matter of course, we will know they are exploring that new road. And that road may very well lead to “transfer IRAs.”
If you have questions about this or any other OFCCP-related matter, please feel free to contact us at BCGi@Biddle.com.
