Dallas Bar Association

Beware of the Scratch of the Cat’s Paw

by Natalie Arbaugh

Under the “cat’s paw” theory, an employer may be liable when a decision-maker who makes the decision to fire an employee or take some other adverse action is influenced by a subordinate’s discriminatory animus. The cat’s-paw theory has received favorable reception in many of the circuits around the country, but the threshold for imputing liability to the employer has varied widely among the circuits. 

In March, the Supreme Court endorsed the cat’s-paw theory in Staub v. Proctor Hospital, 131 S. Ct. 1186 (U.S. 2011), holding that an employer may be liable when a biased supervisor’s action is the proximate cause of a worker’s termination. Vincent Staub worked for Proctor Hospital until 2004 when he was fired. He was a member of the Army Reserve, which periodically required him to be absent from work. His supervisors were hostile to his military obligations, because his coworkers had to “bend over backwards” to cover his schedule while he was away. Staub was placed on corrective action for failing to be at his desk as required. In April 2004, his supervisor informed HR that he was away from his desk without notifying his supervisor, in violation of the corrective action. Staub disputed the corrective action, as well as the claim that he did not notify his supervisor. The HR Manager reviewed the accusations and Staub’s personnel file, but did not speak with Staub about them.

Relying on the cat’s-paw theory, Staub sued under the Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA), which prohibits discrimination on the basis of military service. A jury found in favor of Staub, but the Seventh Circuit reversed, holding that Proctor was entitled to judgment as a matter of law. The court determined that the case could not proceed unless the biased supervisors exercised “singular influence” over the HR manager’s decision to terminate Staub. While the HR manager’s investigation could have been “more robust,” it was enough for the court that the HR manager was “not wholly dependent on a single source of information and conduct[ed] her own investigation into the facts relevant to the decision.”

The Supreme Court reversed, holding 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.” The court refused to adopt a “hard and fast rule” that an employer may insulate itself from liability by showing that the decision maker conducted an independent investigation. The Court did not, however, foreclose the possibility that such an investigation might curtail liability, explaining that “if the employer’s investigation results in an adverse action for reasons unrelated to the supervisor’s original biased action . . . then the employer will not be liable.” Staub makes clear that its reasoning applies beyond USERRA cases, expressly noting that TitleVII also uses the “a motivating factor” causation standard.

The Court’s rejection of the Seventh Circuit’s stringent cat’s-paw standard in Staub largely is a victory for employees. Mere investigation by a decision-maker will not per se insulate the employer from liability. And because the Court’s focus is on intent and proximate cause, one can argue that employers will have a tougher time obtaining summary judgments in cat’s-paw cases.

On the other hand, proximate cause is not an easy standard. An employee will still have to show that the supervisor was motivated by discriminatory intent, which resulted in adverse action by the ultimate decision maker. While the Court did not close the door on investigations providing a possible defense for an employer, it now will be left for the lower courts to flesh out the parameters of this standard.

Meanwhile, employers can take certain steps to protect themselves from the reach of the cat’s paw. Employers should not merely rubber stamp a supervisor’s request to take an adverse action, which Staub makes clear will not suffice. A meaningful investigation should be conducted to independently determine whether a supervisor’s actions are justified—one which looks at more than just the personnel file and digs into both sides of the story. Employers need to train their supervisors and HR managers on how to conduct a proper investigation. As always, employers should also train supervisors on the laws and do everything possible to detect and take steps to eliminate discriminatory animus in the workplace. 

Natalie Arbaugh is a Principal in the Litigation and Dispute Resolution section of Fish & Richardson P.C. and a Co-Vice Chair of the Publications Committee. She can be reached at Arbaugh@fr.com.

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