Friday, May 25, 2007

Subordinate Bias - The "Trickle Up" Effect

I recently came across an excellent article in the New York Law Journal written by Loren Gesinsky and Douglas P. Lipsky (May 21, 2007) concerning the concept of "subordinate bias." Under that theory, the bias of an individual who has no authority to take action against an employee (i.e., a non-decision-maker) is imputed to the employer for purposes of establishing a case of discrimination. So, for example, if the head of a field crew (having no authority to hire and fire) makes discriminatory comments to his or her Supervisor about a worker which form the basis for the Supervisor's discharge of that employee, those comments could be imputed to the employer since they influenced the actual, adverse employment decision. Essentially, this is a "trickle-up" effect where an employer can be held liable for the improper actions of low-level, non-managerial employees of which it may not be aware.

There is a split among the Circuit Courts of Appeal on this issue. As far as New York is concerned, the Second Circuit seems somewhat sympathetic to the concept (see Rose v. New York City Board of Education, 257 F.3d 156 (2d Cir. 2001)), but uses an "enormous influence" standard which appears to be much higher than lesser standards used by other courts such as the Fifth Circuit in Russell v. McKinney Hosp. Venture, 235 F.3d 219 (5th Cir. 2000)("may have affected" standard utilized). Interestingly, a recent decision from the Southern District of New York held that subordinate bias does not exist where the adverse employment decision is based on an independent evaluation by the decision maker rather than the discriminatory actions of the subordinate. See Knight v. New York City Housing Authority, 2007 WL 313435 (S.D.N.Y. February 2, 2007). In short, the issue seems to center around the degree of influence that the subordinate's actions have over the ultimate employment action.

On January 5, 2007, the U.S. Supreme Court granted certiorari in E.E.O.C. v. BCI Coca-Cola Bottling Co. of Los Angeles (06-341), a case involving subordinate bias which may resolve the split among the circuits. This is one to watch closely as it could have significant and unwelcome ramifications for employers throughout the country.

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