U.S. Supreme Court Establishes an Employee-Friendly Legal Standard for Alleging Title VII Claims based on Job Transfers

Paula Lopez, April 25, 2024

Last week, the U.S. Supreme Court rendered a unanimous decision making it easier for employees to pursue Title VII claims against an employer for a forced transfer even though the employee’s rank and pay are unaffected. In Muldrow v. City of St. Louis, Missouri, the Court’s decision, written by Justice Elena Kagan, rejected the heightened standard followed by the U.S. Court of Appeals for the Eighth Circuit, as well as numerous other circuits, including the U.S. Court of Appeals for the Second Circuit, which has appellate jurisdiction over federal cases filed in New York. The standard rejected by the Court in Muldrow required an employee to show that a forced lateral transfer caused a “significant,” “material” or “substantial” harm in order for the transfer to be considered an actionable adverse employment action under Title VII. In rejecting the heightened standard, the Court clarified that Title VII only requires that an employee show that the transfer caused “some harm” with respect to a term and condition of employment.

Muldrow involved the dismissal of a police officer’s claim against the St. Louis Police Department alleging that her forced lateral transfer was based on gender discrimination in violation of Title VII. Ms. Muldrow, who had worked in a specialized Intelligence Division from 2008 to 2017, alleged that her new supervisor wanted to replace her with a male officer resulting in the forced transfer. Although the transfer did not result in a change to  Muldrow’s rank and pay, she alleged that she was harmed by the transfer because of the changes to the terms and conditions of her employment and that the decision to transfer her was based on her sex. Specifically, Ms. Muldrow went from working as a plainclothes officer in the specialized Intelligence Division where she served as, inter alia, head of the Gun Crimes Unit, was deputized as a task force officer with the FBI, was given FBI credentials, was provided with an unmarked take-home vehicle and worked a set schedule Monday to Friday to a uniformed position in which she oversaw neighborhood patrol officers, was required to work rotating weekend schedules, and lost her FBI credentials and her take-home vehicle.

The district court granted the City’s summary judgment motion and dismissed Ms. Muldrow’s claim, finding that under the precedent in the Eighth Circuit, Muldrow could not meet the heightened standard requiring a showing that the transfer caused “a material employment disadvantage.”  The Eighth Circuit affirmed the dismissal by applying the same heightened standard.

The Supreme Court reversed the dismissal of Ms. Muldrow’s discrimination claim and  resolved a circuit split on the issue of whether an employee challenging a forced transfer under Title VII is required to meet a heightened threshold of scrutiny. The Eighth, First, Second, Fourth, Seventh, Tenth and Eleventh Circuits impose a higher “materiality” standard to determine whether the harm allegedly suffered by the employee bringing the claim is sufficient to state a claim under Title VII. In contrast, the D.C. Circuit’s 2022 en banc decision in Chambers v. District of Columbia, overruled its own prior precedent that the denial or forced acceptance of a job transfer is only actionable under Title VII if the employee suffered an “objective tangible harm” as being unsupported by the language in Title VII.  The D.C. Circuit held that “[o]nce it has been established that an employer has discriminated against an employee with respect to that employee’s ‘terms, conditions, or privileges of employment’ because of a protected characteristic, the analysis is complete. The plain text of Title VII requires no more.”

The Supreme Court’s ruling rejected the district and circuit court’s reasoning that because Muldrow’s rank and pay was not changed by the transfer, she did not suffer a “material employment disadvantage” sufficient to support a Title VII claim. The Court emphasized that the language of Title VII only requires a showing of “some harm respecting an identifiable term or condition of employment” and does not impose the heightened requirement imposed by lower courts of a showing of a “significant”, “serious”, or “material” disadvantage. The Court stated that “[t]o demand ‘significance’ is to add words-and significant words, as it were—to the statute Congress enacted. It is to impose a new requirement on a Title VII claimant, so that the law as applied demands something more of her than the law as written.”

The Court, instead, found that the changes to Ms. Muldrow’s  “responsibilities, perks, and schedule” constitute a sufficient showing of “some harm” caused by the forced transfer to survive a motion to dismiss. In reaching its decision, the Court relied on the express language of Title VII, which makes it unlawful for an employer “‘to fail or refuse to hire or to 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.’” § 2000e-2(a)(1). Title VII discrimination claims based on forced transfers focus on whether an employee was “discriminated against” with respect to his or her terms and conditions of employment based on race, color, religion, sex or national origin. In this case, Muldrow alleges that the forced transfer was based on her sex and resulted in worse treatment with respect to the terms or conditions of her employment.

Justice Kagan’s ruling rejected the argument made by the City of St. Louis that eliminating the “significant” harm threshold, would open the floodgates to frivolous claims by emphasizing that a plaintiff must still show the existence of “some harm,”  that the harm must relate to the plaintiff’s terms and conditions of employment, and it must be shown that the employer “acted for discriminatory reasons—‘because of’ sex or race or other protected trait.”

By eliminating the higher standard, the Court’s decision makes it easier for employees to avoid an early dismissal of their claim by eliminating a court-imposed evidentiary threshold that is not found in Title VII. Based on the Court’s ruling, employers should carefully review any contemplated changes to an employee’s terms and conditions of employment even if such change will not result in a reduction in pay or rank.