It’s Unanimous: Supreme Court Just Made It Easier to Sue Employers Over DEI Policies

A low-profile case decided Wednesday by the Supreme Court could have big implications for employers’ diversity, equity, and inclusion programs.

Muldrow v. City of St. Louis was a case about a female police officer who alleged that she was transferred from one department to another because of her sex. She argued that the transfer violated Title VII of the Civil Rights Act, which forbids “race, color, religion, sex, or national origin” discrimination with respect to employment “compensation, terms, conditions, or privileges.”

She lost in the lower court because she could not show that the transfer caused her “significant” harm. The lower court held that the transfer “did not result in a diminution to her title, salary, or benefits” and caused “only minor changes in [her] working conditions.”

A unanimous Supreme Court reversed, holding that any harm—whether significant or insignificant—satisfies Title VII.

Writing for the court, Justice Elena Kagan said that the policewoman “does not have to show … that the harm incurred was significant. Or serious, or substantial, or any similar adjective.”

The take-away is that the policewoman gets to sue, and so do a lot of other people. And not just over sex discrimination or transfers.

The opinion covers a lot more.

Title VII applies to all compensation, terms, conditions, and privileges of employment. If you have been fired, transferred, denied a bonus, or forced to attend (or excluded from) a training program, mentorship program, or retreat, on the basis of your race, sex, or religion, you can sue.

And now, you need not prove that you suffered any significant sort of harm.

As Justice Brett Kavanaugh explained in his concurring opinion, if there’s no floor on the amount of harm you must suffer, then the harm requirement is satisfied by any change in “money, time, satisfaction, schedule, convenience, commuting costs or time, prestige, status, career prospects, interest level, perks, professional relationships, networking opportunities, effects on family obligations, or the like.”

The ruling applies to sex-based transfers, like the policewoman’s, but it also applies to many corporate DEI programs.

It’s fashionable for corporate employers to create race- and sex-based employment conditions and privileges as part of their DEI initiatives.  

Some cases are obvious and egregious. For example, Novant Health fired a white male executive in order to replace him with two women—one black, the other white. And Starbucks fired a former manager because she was white.

Other cases are subtle yet ubiquitous. LinkedIn’s “employee resource groups” and mentoring and training programs for “systemically marginalized” groups are representative examples. LinkedIn gives employees access to official programs organized on race and sex lines and creates special mentorships for members of certain groups.

These are all “privileges of employment” under Title VII.

LinkedIn also provides the leaders of these groups special pay on top of their salaries, which is “compensation” under Title VII.

Similarly, other companies, such as the law firms Morrison Foerster and Perkins Coie, provided race-based fellowships until they were sued. Other companies, like Twilio, consider race during layoffs.

Still more companies—including Starbucks, Morgan Stanley, McDonald’s, Hershey, BlackRock, Disney, and many others—administer programs and engage in practices that appear to give or deny special preferences and detriments on the basis of race and sex.

All of these programs and practices are celebrated as part of what Microsoft, for example, calls its “Diversity and Inclusion Journey,” which aims to “intentionally shift behavior” so that “everyone is accountable for change.”

Until Muldrow, cases challenging these programs faced the hurdle of having to prove “significant” harm. A judge might say, “Yes, you were discriminated against, but you didn’t really suffer.” To this, Kavanaugh and others would answer “discrimination is harm,” but that claim wouldn’t have gotten you anywhere.  

A judge or jury sympathetic to DEI programs could easily say that a black person who was forced to work on certain projects to meet a client’s racial quota hadn’t suffered “significant” harm. Or that an Asian person denied the benefits of a mentorship program given to black employees hadn’t suffered “significant” harm. Or that a white person forced to undergo training telling her to “be less white” hadn’t suffered “significant” harm.

Today, that hurdle is gone. The harm requirement may now be satisfied by anything as simple as discomfort, status, or interest level. Functionally, discrimination alone is all that must now be proved.

That means that anti-DEI lawsuits just got a lot easier.