Tennessee Chamber of Commerce & Industry
New Legislation Levels Playing Field
for Tennessee Employers
By William H. Pickering
U
ntil last September, employers who
were sued for discrimination or
retaliation in Tennessee state court
had a reasonably good chance of getting
unmeritorious claims dismissed before trial.
If a plaintiff sued for discrimination or retaliation but was actually discharged for a legitimate reason (such as poor performance or misconduct), the employer could file a Motion for
Summary Judgment asking that the case be
dismissed. Under a line of cases that began with
the United States Supreme Court’s 1973 decision in McDonnell Douglas Corp. v. Green,
once the employer demonstrated that the
employment action the plaintiff was complaining about (such as a discharge or failure to promote) was taken for a legitimate reason, the
burden was on the plaintiff to provide evidence
that the reason given by the employer was just
a “pretext” for illegal discrimination or retaliation. Basically, the plaintiff needed to show that
he actually had evidence to support his claim,
or the case would be thrown out.
The Gossett Case
The McDonnell Douglas standard had
been applied to summary judgment motions
filed by employers in both state and federal
court in Tennessee. Last year’s decision by the
Tennessee Supreme Court in Gossett v.
Tractor Supply Co., Inc. changed that. In the
Gossett case, a company’s Inventory Control
Manager sued for retaliatory discharge, claiming that he was terminated because he had
refused the CFO’s request to make improper
accounting entries and that this violated public policy. The employer in Gossett filed a
motion for summary judgment and provided
evidence that the plaintiff had been terminated for a legitimate reason, specifically a reduction in force. This normally would have placed
the burden on the plaintiff to come forward
with evidence that the reduction in force was
not the real reason for his termination and that
he was actually fired for refusing to “cook the
books” as allegedly directed by the CFO.
The Tennessee Supreme Court ruled that
the employer was not entitled to summary
judgment and, in particular, that the
McDonnell Douglas framework described
above would no longer be used to evaluate
motions for summary judgment in Tennessee
state court. The Court stated that, in order to
obtain summary judgment, the employer must
provide evidence affirmatively demonstrating
that the plaintiff would not be able to prove his
case at trial. In this particular case, the Court
concluded that, even though the employer had
stated a legitimate reason for the plaintiff’s discharge, the company had not affirmatively
established that the reduction in force was the
exclusive reason for the plaintiff’s termination.
The Gossett case was a 3-2 decision, and two
of the Tennessee Supreme Court’s five justices
filed a strong dissent. The dissenting justices
noted that the McDonnell Douglas framework
had “served Tennessee courts long and well in
employment law cases.” They recognized that
the majority’s decision in Gossett would make it
very difficult for employers to obtain dismissal
of unmeritorious claims, stating:
[A]n employer advancing a legitimate reason
for its personnel action may now fail at the
summary judgment stage even if the employee has no evidence of pretext. This sweeping
change in our law will make it needlessly
more difficult for defendants to obtain summary judgment in employment discrimination and retaliation cases . . .
McDonnelll Douglas
Frameworrk Restorred
Legislation passed by the 2011 General
Assembly – supported by the Tennessee
Chamber – overrules the Gossett decision
and restores the McDonnell Douglas framework as the appropriate and legally required
framework for the evaluation of employment
discrimination and retaliation claims at all
stages of the proceedings, including the summary judgment stage.
The legislation, sponsored by Sen. Brian
Kelsey and Rep. Vance Dennis, applies to discrimination and retaliation claims filed under
the Tennessee Humans Rights Act, the
Tennessee Handicap Act, and the Tennessee
whistleblower statute, and also to common law
claims for wrongful discharge (including claims
for discharge in retaliation for the filing of a
worker’s compensation claim). The legislation
provides that, in all of these cases, the plaintiff
must first establish a prima facie case of discrimination or retaliation. If the plaintiff does so, the
burden is then on the employer to produce evidence that there was a legitimate, nondiscriminatory reason for the challenged employment
action. If the employer produces such evidence,
the plaintiff’s prima facie case is considered
rebutted, and the ultimate burden is on the
plaintiff to demonstrate that the reason given by
the employer was not the true reason for the
challenged employment action but was a pretext for illegal discrimination or retaliation. The
legislation makes clear that the plaintiff at all
times has the burden of persuading the judge or
jury that the plaintiff was the victim of unlawful discrimination or retaliation.
Challenges to the new law are expected.
Plaintiffs’ employment lawyers spoke in opposition to the bill during the legislative debate,
and some legislators were opposed to the bill.
Arguments were made that the McDonnell
Douglas framework historically had not been
applied to all types of discrimination and retaliation cases. The opposition also argued that
the courts, not the legislature, had the authority to determine the procedural standards and
framework to be applied in evaluating discrimination and retaliation cases.
This important legislation helps to level the
playing field for employers in Tennessee.
When employers show that discharges and
other employment actions were made for
legitimate reasons, the cases may be dismissed,
and employers will avoid the expense of going
to trial on unmeritorious claims. On the other
hand, if the plaintiff has evidence that the
employer’s stated reason for the action taken
was just a pretext for discrimination or retaliation; the plaintiff will get his day in court.
Bill Pickering is a shareholder with the law
firm of Chambliss, Bahner & Stophel, P.C. He
represents management in employment
litigation in Tennessee and other states.
A graduate of the University of the South and
Vanderbilt Law School, Mr. Pickering is listed
in The Best Lawyers in America for Labor
and Employment Law. He can be reached at
(423) 757-0218 or by email at
wpickering@cbslawfirm.com
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