HR Legalist

What You Don’t Know Can’t Hurt You: The Lack of Knowledge Defense in Employment Retaliation Claims

When it comes to minimizing the risk of employment retaliation claims, can ignorance be bliss? In today’s competitive business environment, “what you don’t know can’t hurt you” may sound naïve. But in the employment retaliation context, a decisionmaker’s lack of knowledge of an employee’s complaint may provide a defense to a subsequent retaliation claim. Employers should pay particular attention to this potential defense given that the EEOC reports that retaliation-based charges were the most common charges filed with the EEOC in 2013 (appearing in 41.1% of charges) for the fifth year in a row.

Under various state and federal laws, employees may claim that they were retaliated against for engaging in protected activity, which includes: (1) complaining about or opposing discrimination; (2) reporting illegal conduct; (3) requesting accommodations for a disability; or (4) requesting time off for family or disability leave. In some instances, the supervisor who makes the decision to terminate or demote an employee may not be aware of the employee’s earlier complaint or request, especially if it was handled by another department. This opens up a potential defense for the employer in a subsequent retaliation lawsuit: for protected activity to be a substantial or motivating factor in a decision, it logically follows that the decisionmaker must be aware of the protected activity.

In Ferguson v. Middle Tennessee State University, 2013 Tenn. App. LEXIS 221 (Tenn. Ct. App. Mar. 28, 2013), the Tennessee Court of Appeals reversed a $3 million jury verdict for the plaintiff in a retaliation case because the plaintiff failed to prove that the decisionmaker had knowledge of the protected activity when the adverse employment decision was made. In Ferguson, the court rejected the idea that an employer could be liable for a retaliation claim based on “general corporate knowledge” that the employee engaged in protected activity. Rather, the court explained that “the plaintiff in a retaliation lawsuit is required to show that the decisionmaker, the individual who took the adverse job action against the plaintiff, had knowledge of the plaintiff’s protected activity at the time of the adverse job action.”

Unfortunately, a lack of knowledge defense is not necessarily airtight, especially if there are factual disputes about “who knew what when.” For example, courts have refused to recognize lack of knowledge as a defense to a retaliation claim in the following scenarios:

• An employee received a factually questionable evaluation one month after copying his employer’s internal EEO office on a hearing request to the EEOC.
• Several days before her termination, an employee wrote a letter complaining about discrimination and copied the decisionmaker.
• A supervisor modified the job duties of several minority employees after receiving an e-mail identifying them as the authors of an anonymous letter complaining about discrimination.
• Two employees were terminated after making complaints of unsanitary conditions to multiple supervisors and human resources, and one employee was told that she was being fired for “other issues” beyond the stated reason.
• The supervisors who removed the employee from his position were involved in a Department of Labor investigation and knew it involved employees with the complaining employee’s title and a supervisor made a comment to the employee about his involvement in the investigation.

While it is not always possible to prevent potential decisionmakers from finding out about employee complaints, the following practices can help limit knowledge and reduce the risk of retaliation:

• Designate a department or individual outside of the direct chain of command, such as human resources or compliance, to handle complaints.  Advise employees to make complaints directly to that department, and train supervisors to refer employees to the appropriate department as soon as possible, without getting into detail about the basis of the complaint.
• If an internal investigation is necessary, such as when an employee complains about harassment, keep the identity of the complainant confidential unless it is necessary to conduct a thorough investigation.  For example, if the complainant alleges that her supervisor used a racial slur with multiple witnesses present, the witnesses and the supervisor can be asked about the alleged comment without disclosing the complainant’s name.
• Require the complainant and all witnesses to sign a statement requiring them to keep the subject matter of the investigation confidential, and advising them that retaliation for making a complaint or participating in a complaint is prohibited and any such retaliation may be grounds for discipline.
• To avoid any dispute about who made an adverse employment decision, clearly define who within the organization has authority to make personnel decisions, and train supervisors about the process to be followed.
• If an employee who has previously filed a complaint has subsequent performance issues that warrant discipline, ensure that the performance issues are well documented and that any discipline is consistent with company policy.

Although a lack of knowledge argument can be helpful in certain situations, employers should take proactive steps, such as policy implementation and training, to reduce the risk of retaliation lawsuits. Further, employers should ensure that all personnel actions are consistent and supported by documentation.