New U.S. Supreme Court terms begin each year on the first Monday in October. Justices will hear and decide on a number of cases this year, touching on a variety of issues. One poses the possibility of an update to laws on whistleblower protections under the federal Sarbanes-Oxley Act.
A ruling in favor of the employer in this matter could be a treat, and not a trick, for management-side employment lawyers and the companies they represent.
In Murray v. USB Securities, an employee sued his employer, claiming he was fired because he made complaints of fraud after being pressured to submit false reports. Murray brought the action under the SOX anti-retaliation provision and won at the district court level but lost on appeal when the 2nd Circuit sided with the employer, which argued the employee had to prove the company had a retaliatory intent when it acted to terminate. The Supreme Court now will determine who has the burden of proof, the employee or the employer. A ruling in favor of the employer would have a significant effect on whistleblower litigation in this context, as it would make it more difficult for plaintiffs to pursue and succeed on these claims.
In December, the court will hear another employment law-related case – Muldrow v. City of St. Louis, Missouri. In Muldrow, a former employee filed a discrimination lawsuit after she was transferred to a different role and denied her requested transfer, claiming the decisions were based on her sex. On appeal, the 8th Circuit found there was no Title VII violation, as it was not enough that the decision affected the “conditions” of her employment and that she had to do more by establishing a “material employment disadvantage.” After hearing oral arguments in December, the Supreme Court will determine whether Title VII prohibits discrimination in the context of job transfers without a separate determination showing the decision caused a significant disadvantage to the employee. A finding in favor of the plaintiff could broaden the pool of potentially actionable adverse employment actions.
Overall, as you stay up to date on new developments, employers need not be scared of the dark when it comes to potential changes from this year’s round of U.S. Supreme Court decisions.
* This article first appeared in The Journal Record on October 18, 2023, and is reproduced with permission from the publisher.