Massachusetts Supreme Judicial Court Reaffirms “Cat’s Paw” Theory of Liability in Employment Discrimination

June 29, 2023 Advisory

The Massachusetts Supreme Judicial Court (SJC) recently issued a decision with important implications for Massachusetts employers, particularly those considering or in the process of implementing layoffs.

In Adams v. Schneider Electric USA, the SJC held that an employee who was laid off in a reduction in force could maintain an age discrimination claim against his former employer based on evidence of a corporate strategy to reduce the number of older employees, even if the supervisor who selected the employees for layoff had no knowledge of the corporate strategy and did not consider age in making the selections. This type of employment discrimination is often referred to as the “cat’s paw” theory of liability, after a fable in which a monkey convinces a cat to roast chestnuts, then makes off with them, leaving the cat with a burned paw and nothing to show for it.

The plaintiff in the case, Mark Adams, was 54 years old at the time he was laid off as part of Schneider Electric’s reduction in force. Schneider Electric’s R&D Director of Engineering Kenneth Colby was solely responsible for selecting employees for the reduction in force. Colby denied that he considered employees’ ages in determining whom to lay off and explained that the primary factor he used was whose layoff would have the least impact on the work of his group. Indeed, even Adams stated that he did not believe Colby bore any discriminatory animus toward him. Based on these facts, the trial court granted summary judgment for the employer.

Reversing the grant of summary judgment, the SJC held that Schneider Electric could be found liable for discrimination under the Massachusetts anti-discrimination statute, Chapter 151B, based on the “cat’s paw” or innocent pawn theory of liability. As the SJC explained, it “is possible, and consistent with liability under the employment discrimination statute, for a mid-level manager directed to lay off employees in his or her division to be found to further a discriminatory corporate policy without knowingly doing so.”

The SJC found that there was sufficient evidence of a discriminatory corporate policy to survive summary judgment, even if Colby was unaware of such a policy when he selected Adams for layoff. This evidence included, among other things, statements by corporate executives in e-mail communications expressing concern about the age of their workforce, stating a desire to change the “demographics mix” and a preference for “more early career talents,” and discussing “budget reductions” to make “room” for new younger hires.

Another key fact was that the overwhelming majority of employees selected for layoff during the relevant timeframe were older. In 2016, all but one of the 16 employees laid off were over 40, and most were over 50. In 2017, all eight employees laid off were over 50. In addition, there was evidence of selective enforcement of budget reduction requirements and layoffs in offices where employees tended to be older, and management continued to encourage the hiring of younger employees via college recruiting despite mandatory budget reductions and layoffs.

The SJC found that Colby’s knowledge of the discriminatory policy was unnecessary to establish the employer’s liability for employment discrimination: “It would constitute unlawful discrimination if executives at the company targeted the HBN R&D group for layoffs in the first place because of the age of the employees in that group, even if Colby himself was ignorant of the larger scheme when he selected individual employees for termination.” The SJC further explained, “A discriminatory corporate decision is not insulated from liability just because it is implemented by managers with limited decision-making authority, unaware that they are being used as ‘pawns’ or ‘paws.’”

The Adams decision underscores the importance of making efforts to eliminate discrimination at all levels of a company, as bias at any level can create a risk of liability for the resulting adverse employment decisions, even if those decisions are ultimately carried out by individuals without such bias.  Employers that need to conduct reductions in force should carefully review not only the specific employees selected for layoff, but also the overall process, ideally with the support of legal counsel. In doing such reviews, employers should pay special attention to the selection criteria as well as to the actual employees affected and assess whether certain employee groups may be disproportionately impacted.

Employers with questions about how to implement layoffs or other employee terminations to minimize the risk of discrimination claims are encouraged to contact the authors listed below or their regular Armstrong Teasdale lawyer. 

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