When is a Transfer an Adverse Employment Action? Muldrow v. City of St. Louis, Missouri

By Rebecca Bruch, Esq.

Currently pending in the United States Supreme Court is the case of Jatonya Muldrow v. City of St. Louis, Missouri, which could upend current law related to whether a transfer of an employee is an adverse employment action when there is no significant change in the employee’s status, compensation, or benefits. The case was argued in December 2023, and a decision should be forthcoming in March or April. The Court will soon decide whether Title VII prohibits discrimination in transfer decisions if the transfer decision did not cause a significant disadvantage, but rather, was made for discriminatory reasons. The Court took up this issue partly because of a split in the circuits. The scope is narrow, it only addresses transfers when no significant disadvantage is created. Nevertheless, a decision in favor of the plaintiff should trigger your spidey sense and cause you to take a close look at the ripple effects of lateral transfers.

Sgt. Muldrow served in the Intelligence Division of the City of St. Louis Police Department. She handled high-profile public corruption cases, oversaw the Gang Unit, and was assigned to work with the local FBI unit. She was able to wear plain clothes, work a Monday-through-Friday schedule, had access to an unmarked FBI vehicle, and had the opportunity to earn substantial overtime pay. In 2017, a new Commander was put in place. As new leaders often do, he made personnel changes that included transferring 22 officers, 17 of whom were male, to other positions. Sgt. Muldrow was one of the 17 that was transferred. Her new position was primarily administrative along with supervising patrol officers, and responding to serious crimes like homicides. She had to work a rotating schedule, including weekends, wear a police uniform, and use a marked car. Her salary was the same, but she lost eligibility for the previous FBI overtime pay.  However, she had other overtime opportunities.

After about eight months of applying for other positions, she was able to get back into the Intelligence Division.

Sgt. Muldrow filed a lawsuit, claiming her transfer was motivated by the new Commander wanting a man in her previous position, and she was a female.  She argued the transfer was an adverse employment action because the new position was more comparable to entry-level work and had less prestige than her previous work. She argued that even though there was an absence of tangible or material disadvantages because of the transfer, a Title VII claim arises solely because the decision allegedly was based on her gender.  According to Sgt. Muldrow, “any decision based on an employee’s protected characteristic is sufficient to create Title VII liability.” She went on to suggest any amount of differential treatment based on one’s protected characteristics is, in and of itself, harmful and discriminatory.

The City argued that abandoning the need for a significant disadvantage would allow frivolous claims based on minor, trivial changes to a work environment, which would undermine the purpose of Title VII.

Both the district court and the Eighth Circuit ruled against Sgt. Muldrow, saying that the transfer did not lead to a materially significant disadvantage, since her pay and rank remained the same; she still held a supervisory position; her responsibilities included prestigious and advanced work investigating important crimes; and the transfer did not harm her future career prospects.

At the Supreme Court, Sgt. Muldrow argued that the differential treatment alone is sufficient to allege a Title VII violation because it can create a stigma, observing that differential treatment is in most circumstances “worse” treatment.

From the “bleachers” where I sit and make my editorial comments, it appears to me that in a situation like Sgt. Muldrow’s, her argument stymies every new boss’s ability to make changes for fear that they would automatically be deemed discriminatory just because employees of different genders are involved and affected. Justice Kagan’s observation and question was similar to mine, although certainly more articulate. She said, “It’s a funny sentence to write, distinctions or differences in treatment that injure protected individuals, if you think that all distinctions and differences injure protected individuals.” The attorney for the Biden administration, which joined in the case on behalf of Sgt. Muldrow, did admit that some distinctions such as dress codes and bathrooms do not trigger actionable Title VII discrimination, at least with regard to sex discrimination. Of course, the LGBTQ+ community strongly disagrees with such a concession, arguing that dress codes and bathroom differences are inherently discriminatory.

What does all of this mean to you and your operations? If the Supreme Court decides that lateral transfers made for discriminatory reasons are unlawful, the decision will chill the ability to make day-to-day decisions for fear of garnering an EEOC complaint and litigation. It is easy to see how it will change the landscape in things such as performance issues, discipline and PIPs, work assignments, meeting attendance, travel decisions and training that do not amount to demotions or termination.

You will want to look at your HR policies, as well as engaging in an in-depth analysis of how decisions are made that involve a change in conditions for any employees, including the subtle effects of seemingly innocuous lateral transfers made for purely business reasons.

Stay tuned for a decision in the Muldrow case in the next few months. At the very least, it will clarify the split in opinions between the circuits, including the Ninth Circuit, which is notoriously much more sympathetic to employees than other circuits in the country. On the other hand, if the Court sides with Sgt. Muldrow, it will change the way all employers will make their decisions, and we will all be spending more time with the EEOC.

The employment attorneys at Lemons, Grundy and Eisenberg are available to talk about this and all aspects of your personnel and human resource challenges.