Good morning!
Yesterday, the U.S. Supreme Court issued a unanimous ruling making it easier for workers to sue employers for discrimination if they’re forced to transfer jobs within an organization.
The case was brought by a police sergeant in St. Louis who alleged that she was moved to a less prestigious role because she was a woman, even though she kept the same rank and pay. A lower court previously ruled an employee must show that getting moved caused problems in terms of salary, rank, or career prospects, but the highest court’s decision this week lowers the bar for how much harm employees must prove to bring a discrimination case.
“Although an employee must show some harm from a forced transfer to prevail in a Title VII suit, she need not show that the injury satisfies a significance test,” Justice Elena Kagan wrote in her opinion.
The decision impacts HR departments around the country, and experts tell Fortune that CHROs will have to apply a new level of scrutiny and forethought to employee-related decisions that might not have required deep consideration before, carefully documenting their decision making, and broadening the scope of their responsibilities with a company.
“For HR, there needs to be some greater involvement when the business is looking at personnel actions that may not seem out of the norm at first blush,” says Tiffany Cox Stacy, an employment attorney and office managing shareholder at Ogletree Deakins. “Companies often reorganize, move people around, and that happens all the time for very good reasons. So sometimes, we don’t look at it as closely as we should.”
Human resources is often already deeply involved in reviewing promotion or termination decisions to avoid any discrimination allegations, taking care to document the reasoning behind these decisions. Cox Stacy recommends HR departments now apply those same best practices to all job transfers, and look out for any potential employee grievances that could arise from reassignment. When a worker doesn’t want the transfer, it’s imperative for HR teams to work with supervisors to clearly document the reason for the job change, and show that discrimination plays no part.
“By doing that, HR is really the first line of defense for being able to provide evidence as to why the business had to do what it had to,” says Cox Stacy.
The Supreme Court decision also means that HR leaders are going to have to work directly with more employees than ever before, according to Lauren Hartz, a partner at law firm Jenner & Block, who says bosses at all levels will be looking to HR for guidance.
“We might be talking about lower-level managers who previously weren’t involved in the kind of decisions that could trigger Title VII. But with this new standard are more a part of decisions that lead to potential liability,” she says.
The court’s decision may also extend beyond unwanted job transfers, and apply to other personnel decisions like leadership opportunities, mentorship programs, and employee perks, Hartz says. That means that choices companies considered legally benign will demand even more strategy and clarity from HR departments moving forward.
“We’re really going to have to wait and see what guidance we get from the lower courts about those precise contours,” says Hartz. Until then, she says companies should be “very careful to make sure decisions are made for the right reasons, are not made for the wrong reasons, and are documented and supported appropriately.”
Paige McGlauflin
paige.mcglauflin@fortune.com
@paidion
Today’s edition was curated by Emma Burleigh.
Around the Table
A round-up of the most important HR headlines.
- Bankers can rescind job offers they’ve accepted, but it might cost them a pretty penny—financial workers are racking up millions in “break up” fees as recruiting gets hardcore. Bloomberg
- A senior NPR editor resigned after publishing a scathing critique of the media company. Wall Street Journal
- Amazon is falling behind on its promise to add 2,500 jobs at its Virginia headquarters in exchange for tax subsidies—losing hundreds of Arlington workers last year. Washington Post
Watercooler
Everything you need to know from Fortune.
Puppet picketing. The writers behind Sesame Street have unanimously voted to strike if they can’t negotiate a new contract by Friday. —Chloe Berger
Fruitless. The CEO of Dropbox says the trend of employers forcing RTO mandates on staffers breeds toxicity. —Orianna Rosa Royle
Talent war. A Goldman Sachs executive leaving the bank for a new senior role says the company is bleeding top women workers. —Luisa Beltran
Protecting WFH. Singapore is enshrining work flexibility into law—employees will be permitted to request condensed workweeks, remote options, and asynchronous schedules starting Dec. 1 this year. —Jane Thier
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