Supreme Court Rules: Employers Can be Held Liable for Unlawful Discrimination under USERRA Using Cat's Paw Theory of Liability

"Cat's paw" theory is used to describe a situation where in one uses another to accomplish his or her purpose. It is based on a 17th Century French fable, "The Monkey and the Cat," about a devious monkey persuading an unworldly cat to obtain chestnuts from a burning fire. The poor cat gets burned, only to watch the monkey gobble up all of the chestnuts.

In the case, Staub v. Proctor Hospital, on March 1, 2011, the U.S. Supreme Court Ruling addressed employer liability regarding unlawful discrimination under the Uniformed Services Employment and Reemployment Rights Act (USERRA). The statute prohibits adverse employment decisions in which discrimination is a motivating factor. Under this statute, "[a]n employer shall be considered to have engaged in actions prohibited [by USERRA] . . . if the person's membership ... in the uniformed services is a motivating factor in the employer's action."

Mr. Victor Staub worked for Proctor Hospital as an angiography technician and during his tenure with Proctor was also a member of the United States Army Reserves. Trial evidence revealed that Staub's management team, including his supervisor and her boss, discriminated against Staub because of his military obligations.

His supervisor repeatedly crafted the work schedule so that Staub was responsible for shifts during which he also had Reserves commitments. The supervisor was known to make disparaging comments regarding military responsibilities and allegedly requested that one of his co-workers, "help her get rid of him." A disciplinary warning was issued to Staub in which he was accused of violating a company rule. At a later date, he was accused again for violating the rule. Finally, the hospital's vice president of human resources was involved and terminated Mr. Staub's employment, having relied on the supervisor's accusations and reports.

Ultimately, Staub's lawsuit against the hospital was filed under USERRA, and alleged that the supervisor's discrimination against Staub, due to military obligations, was what influenced the human resources vice president to make the ultimate decision to fire Staub. Initially, the jury found Proctor Hospital to be liable; however, this was reversed by the U.S. Court of Appeals for the Seventh Circuit. The Court of Appeals' decision held that Mr. Staub's supervisor, a non-decision maker, would have to have "singular" influence" over the Human Resources Vice President, the ultimate decision maker, in order for Proctor Hospital to be liable. The court was not convinced that the final decision maker was wholly dependent upon the representations of Mr. Staub's management team, thus Proctor Hospital was "entitled to judgment as a matter of law."

The Supreme Court reversed this decision and its majority opinion held that "if a supervisor performs an act motivated by antimilitary animus that is intended by the supervisor to cause an adverse employment action, and if that act is a proximate cause of the ultimate employment action, then the employer is liable under USERRA." Consequently, because the vice president of HR had relied on the actions and statements by Staub's management team, the Court found that discrimination played a part in the decision to fire Staub. Even though the firing agent, the vice president of HR, harbored no unlawful animus, but relied partly on the basis of discriminatory reports and actions by the management team, then discrimination could be a factor in the action to terminate the employee.

It is important to note that effects of this Supreme Court decision extend beyond the USERRA statute. This statute is very similar to Title VII and both prohibit negative employment actions where discrimination is the motivating factor. This decision will likely be applied to Title VII claims.

What The Heck Is The 'Cat's Paw Theory' And Why Should You Care?, Staffing Talk, by David Gee, March 22, 2011

EMPLOYMENT LAW; The Cat's Out of the Bag; U.S. Supreme Court Endorses 'Cat's Paw' Theory of Liability in Employment Cases, New Jersey Law Journal, May 31, 2011, By Andrew M. Moskowitz and Carly J. Skarbnik

Supreme Court Review in Labor and Employment Law, Part I, New York Law Journal, June 3, 2011

Categories: Discrimination