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Be Brave – Be Independent:
You and Your Company’s Credibility Depends on It

Written By: Billie P. Garde, Clifford and Garde LLP

The U.S. Supreme Court has tackled the issue of employer liability for adverse action decisions made by a corporation, based on the discriminatory intent of a supervisor who was not responsible for making the ultimate employment decision. Case in point is Staub v. Proctor Hospital 562 U.S.411 (2011). In legal terminology this is called “the cat’s paw” theory of liability. Although the original Supreme Court case was a military employee discrimination case, the Courts have been applying this theory in retaliation cases under many employee protection laws, and it has been applied in the Department of Labor to situations in our industries.

What does this mean for us?

Two major points: First, it means that even companies that have some form of an executive review board (ERB) process designed to prevent retaliatory decisions, may be held liable for a decision if the information that it relies upon is only from a supervisor or manager with a retaliatory motive or bias. If the charter of a corporate review board does not insure that there is a comprehensive review of the facts and circumstances surrounding an adverse action – the company will lose legal protection and undermine the purpose of the review process itself. A review process must be more than just a “check the box” process to determine whether protected activity played a contributing factor in an adverse action decision. It must ensure that the process provides for an independent assessment of the reasons proposed for taking an adverse action. Relying on information from a bias supervisor, without an independent assessment, imputes liability to the company – even if they did not have actual knowledge or a discriminatory motive. Many ERB’s are vulnerable to this possibility.

Second, for Employee Concerns Program (ECP) investigators, the Court's decisions emphasize the importance of independent investigations – looking at all the facts, and reaching a conclusion that is not influenced by a manager or supervisor motivated by retaliatory animus. This means an ECP’s independence is important – not just for establishing credibility with employees, but for establishing credibility externally with regulators, the courts, and the public.  

In a case that I investigated some years ago in my role as a corporate ombudsman, I found there was some animus by a supervisor towards an employee, but not because of his protected activity. The terminated employee sued the company and it went to federal court. The Judge held that the independent investigation of the concerns was credible and that the company had, independently and competently investigated the concern, and resolved it. The Court agreed with the investigation results and dismissed the case.

In today’s environment the role of employee “whistleblowers” is becoming a much more common phenomena. Legal protections for whistleblowers stretch across corporate America in ways that are more comprehensive than I could ever have imagined. But some corporations are holding on tight to the old days when support organizations were simply expected to protect the company by ignoring, denying or obfuscating the bad behaviors of some of its employees.  Those days are almost over – our jobs are to independently find the facts, tell the management those facts so that they can take appropriate corrective action, and ensure that decisions are made based on facts --- not on a biased presentation of alternative facts presented to achieve an illegal outcome.

Be brave! In the long run your reputation as a person committed to the truth, respectful in your work, and unbiased in your conclusions will give you the best personal reputation you can earn with employees and management. Your company should benefit from that independence when making difficult decisions.

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