Thomson Reuters has a nepotism policy that prevents close family and relations from being in the same reporting chain of command. This policy provides that a conflict of interest exists when “[s]omeone with a close relationship with you is in a direct reporting relationship with you, or you have the ability to supervise, review or influence the job evaluation, hiring, pay or benefits of someone with a close relationship with you.” The Thomson Reuters policy further defines a “close relationship” to mean “members of your immediate family or household,” “a personal relationship between a supervisor and a subordinate that could influence objectivity,” or a “relationship with a partner, cousin, more distant relative or friend [that] could influence your objectivity.”
The Thomson Reuters policy then expressly places the requirement to act on its employees to prevent any possible violation:
identify potential conflicts when they arise and to notify in writing an appropriate manager, Human Resources representative, or a lawyer who supports your business if you are unsure whether a relationship or transaction poses a conflict before engaging in the conduct or as soon as you learn of the potential conflict. An appropriate manager or Human Resources representative will be able to pre-clear or resolve certain conflicts or will be able to contact someone else at Thomson Reuters who can.
Lisa Holmes was employed as Senior Director in Thomson Reuters’s tax and accounting division. In seeking final approval to offer a job, Holmes sent an email to higher-level management stating that Dena Lambert-Holmes “is not related to Lisa Holmes.” Within a year after Lambert-Holmes was hired, Holmes overly aggressively pushed to promote Lambert-Holmes to the point where her colleagues felt so uncomfortable, they reported the situation to HR.
As the resulting investigation revealed that Holmes’s sister was in a long-term relationship with Lambert-Holmes for several years. Thomson Reuters determined that Holmes and Lambert-Holmes indeed had a close relationship as defined by the policy and that Holmes had failed to properly “notify in writing” Thomson Reuters of that relationship. As a result, Thomson Reuters fired Holmes, who in turn sued for age and gender discrimination citing recent management comments about the need to change the work culture.
For the purpose of the motion for summary judgment, the parties stipulated that Holmes had sufficient evidence to present a prima facie case of wrongful termination based on age and gender discrimination, which meant that the case came down to the issue of pretext.
What does pretext mean in an employment discrimination case?
In an employment discrimination case, pretext refers to a situation in which an employer provides a false or misleading reason for taking an adverse employment action against an employee, such as termination, demotion, or failure to promote. Pretext can be used as evidence to show that the employer’s true motive was discriminatory, and the adverse employment action was taken because of the employee’s membership in a protected class, such as race, sex, age, religion, or national origin.
In other words, pretext is a way for an employee to challenge the employer’s stated reason for the adverse employment action and demonstrate that the true reason was based on discriminatory animus.
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In employment discrimination cases, are there ways to demonstrate pretext if the employee actually violated a company rule or policy?
Employment discrimination occurs when an employee is subjected to adverse employment action because of their protected characteristics, such as race, religion, gender, or age. When an employer is accused of discrimination, it may try to defend itself by arguing that the adverse employment action was taken for legitimate, non-discriminatory reasons. However, if the employee can demonstrate that the reasons given by the employer are mere pretexts, i.e., not the real reason for the adverse employment action, then they may be able to establish a case for discrimination. In cases where the employee violated a company rule or policy, there are still ways to demonstrate pretext.
Primarily an employee can present evidence that the company has not consistently applied the rule or policy to other employees who are similarly situated to the employee who suffered the adverse employment action. In other words, if the employee can show that other employees who violated the same rule or policy were not subjected to the same adverse employment action, then they may be able to demonstrate that the company’s stated reason for the adverse action is pretextual.
For example, in Holcomb v. Iona College, 521 F.3d 130 (2d Cir. 2008), the employee, a female college basketball coach, alleged that she was fired because of her gender in violation of Title VII of the Civil Rights Act of 1964. The college argued that the employee was fired for violating a team rule against recruiting players from a particular club team. However, the employee was able to demonstrate that male coaches who had also violated the same rule were not fired. The United States Court of Appeals for the Second Circuit held that this evidence was sufficient to demonstrate pretext and allowed the employee’s discrimination claim to proceed to trial.
Similarly, in Jones v. Gerwens, 874 F.3d 1075 (8th Cir. 2017), the employee, a Black employee, alleged that he was fired because of his race in violation of Title VII. The employer argued that the employee was fired for violating a company policy against leaving the workplace during work hours without permission. However, the employee was able to demonstrate that white employees who had also violated the same policy were not fired. The United States Court of Appeals for the Eighth Circuit held that this evidence was sufficient to demonstrate pretext and allowed the employee’s discrimination claim to proceed to trial.
In Tademy v. Union Pacific Corp., 614 F.3d 1132 (10th Cir. 2010), the employee, an African-American man, alleged that he was fired because of his race in violation of Title VII. The employer argued that the employee was fired for violating a company rule against insubordination. However, the employee was able to demonstrate that similarly situated non-African-American employees who had also violated the same rule were not fired. The United States Court of Appeals for the Tenth Circuit held that this evidence was sufficient to demonstrate pretext and allowed the employee’s discrimination claim to proceed to trial.
In Brown v. Yellow Freight Sys., Inc., 205 F.3d 1115 (6th Cir. 2000), the employee, an African American man, alleged that he was terminated because of his race in violation of Title VII. The employer argued that the employee was terminated for violating a company policy against theft. However, the employee was able to demonstrate that non-African American employees who had also violated the policy were not terminated. The United States Court of Appeals for the Sixth Circuit held that this evidence was sufficient to demonstrate pretext and allowed the employee’s discrimination claim to proceed to trial.
In each of these cases, the employee was able to demonstrate that the employer’s stated reason for the adverse employment action was not applied consistently to all employees who violated the same rule or policy. This evidence was sufficient to demonstrate pretext and establish a case for discrimination.
It’s important to note that to successfully demonstrate pretext in this way, the employee must be able to identify similarly situated employees who were treated more favorably than they were. This can be challenging, and you should consult an experienced employee’s rights law firm to discuss your options.
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What happened to Lisa Holmes?
Holmes did not argue that the policy was applied unevenly nor inconsistently. Instead, she argued that pretext existed because the investigation was so insufficient and because she verbally reported the conflict – which was inconsistent with her email to the contrary. In Holmes v. Thomson Reuters (Tax And Accounting) Incorporated, No. 22-10133, 2023 WL 2823897 (5th Cir. Apr. 7, 2023), the United States Court of Appeals for the Fifth Circuit had no hesitation in rejecting these arguments and affirming the dismissal of her lawsuit:
First, even if Goodall interviewed those two former employees and found that Holmes verbally disclosed her conflict to them, Goodall did not uncover, nor did Holmes produce, any evidence that she disclosed her conflict in writing to them, or any other appropriate authority, as required by the policy. Indeed, … Holmes’s counsel conceded that “notification to the company has to be in writing” and that Holmes had no “evidence of a written notification.” Nor did Goodall find, or Holmes produce, any evidence that an appropriate official at Thomson Reuters “pre-clear[ed] or resolve[d]” the conflict. In other words, even if Goodall had conducted the investigation to Holmes’s specifications, he would have still concluded that Holmes violated the company policy.
Second, regardless of whether the conclusion of the investigation was correct, Holmes has not produced any evidence that the “real reason” for her termination was discrimination and not her violation of the nepotism policy. Sandstad v. CB Richard Ellis, Inc., 309 F.3d 893, 899 (5th Cir. 2002). Holmes only argued that the investigation arrived at the wrong result. That is not enough to prove pretext. See Bryant v. Compass Grp. USA Inc., 413 F.3d 471, 478 (5th Cir. 2005) (“[E]vidence that the employer’s investigation merely came to an incorrect conclusion does not establish a [discriminatory] motivation behind an adverse employment decision.”).
The key in these types of cases is to seek comparator information in discovery regarding other who violated or may have violated those rules. That’s why hiring the best employee’s rights attorney near you is critical.
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How do I find the best employee’s rights lawyer for my wrongful termination case?
If you have recently been wrongfully fired or terminated based on your race, national origin, gender, age, religion, sexual orientation, gender identity, or disability; or even think that you might need an attorney to sue for employment discrimination or harassment, call the right attorney to schedule a free and confidential consultation. (Read: What is the Spitz No Fee Guarantee?; Why Having Skilled Employment Attorneys Is Critical; Employment Law: Avoid Hiring The Wrong Attorney). Call our lawyers in Ohio, Michigan, North Carolina, and Kentucky to get help now. Spitz, The Employee’s Law Firm and its experienced attorneys are dedicated to protecting employees’ rights and solving employment disputes.
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