Discrimination claims are determined by a three-step analysis. Usually, the third step in this analysis—pretext—is key. Despite the ways in which courts have outlined how pretext for discrimination can be proven, there are times when an employee’s evidence of pretext falls short. A recent case from the U.S. 4th Circuit Court of Appeals is a reminder that pretext alone—that is, arguing that the employer’s nondiscriminatory reason isn’t legitimate—won’t suffice.
The Three-Step Analysis
The first steps of a discrimination claim are relatively simple to establish. For the first step in her case, an employee must show:
- She is in a protected class (e.g., a racial minority, age 40 or over, has a disability);
- She has satisfactory job performance; and
- An adverse employment action was taken against her.
In the second step, the employer must show it had a legitimate nondiscriminatory reason for the adverse employment action. This could be any reason that isn’t connected to the employee’s protected characteristic, such as some sort of misconduct, poor performance, or policy violation by the employee.
The third step is pretext. This is where most of the action happens in an employment discrimination case. Here, the employee must show that the employer’s legitimate nondiscriminatory reason for the adverse employment action wasn’t the real reason for the action, but rather was an excuse used to obscure discrimination based on the employee’s protected characteristic.
Employees devote much attention to trying to establish that pretext exists, which can be proven by several types of evidence. Examples of pretext include changes in an employer’s stated reason for the adverse employment action, deviations from established policies or practices in the action, or implausibility in the employer’s stated nondiscriminatory reason.
Sales Rep Sues for Gender Discrimination
Chandra Balderson was fired by Lincare, Inc., a provider of in-home respiratory care, despite being one of the employer’s most productive sales representatives. According to Lincare, the termination was because she violated its legal compliance program and code of conduct.
Balderson, whose pay was commission-based, provided physicians with the text for progress notes to justify ventilators being provided to their patients. Lincare found 19 progress notes with the same generic statement of medical necessity for ventilators in patient files for sales she made. The employer referenced these as her “cloned” progress notes.
Lincare also found faxes in which Balderson sent the language for the progress notes to the doctors. When a physician ordered a ventilator for a patient using her “cloned” progress notes, she was paid a commission.
Balderson claimed the reason for her termination was pretextual because a male employee had engaged in similar conduct and received only a final written warning. The trial judge found that the employer’s explanation for the male employee receiving a written warning “was not credible” and awarded $30,141 in back pay and $120,000 in punitive damages against the employer.
Significantly, Balderson admitted her misconduct and that the scripts she gave doctors violated the employer’s policies. She also acknowledged she was never the subject of any gender-related comments, and that during the termination process, she didn’t think she was treated differently because of her gender.
Still, she argued that the only reason she was treated differently than the other employee was because he was a man, and she was a woman.
The 4th Circuit noted, however, that the male employee wasn’t paid on a commission basis and wasn’t in a sales role. The male employee also engaged in conduct that was materially different from Balderson’s. He provided doctors with alternative examples of language for a chart note that they could use if applicable to a particular patient.
The employer concluded that the male employee’s language examples didn’t rise to the magnitude of Balderson’s misconduct.
Employee Fails to Prove Pretext
The appeals court stated that Balderson had to prove intentional discrimination and found that the employer’s proffered reason for her termination could be false, but that this alone wouldn’t necessarily result in a finding of pretext. The 4th Circuit found the district judge had erred in finding that if the employer’s reason were pretextual, then unlawful discrimination must “automatically follow.”
The appeals court stated that while Balderson may have shown that her termination was “unwise or even unfair,” she failed to demonstrate that her termination was based on her sex. It specifically noted her testimony that her sex was never an issue during her employment or her termination.
Moreover, the two investigators of Balderson’s conduct were both female, and she was replaced by a woman. Based on this, the appeals court found she simply didn’t prove intentional discrimination based on her sex. Balderson v. Lincare, Inc., Case. No. 21-1753 and 21-1765 (4th Cir., 3/15/23).
Takeaway
This case is a helpful reminder to employers of the ultimate issue in every discrimination charge or complaint. When confronted with a complaint from an employee—whether an internal complaint, a charge of discrimination to an administrative agency, or a lawsuit—the determinative question is whether the employee has evidence of intentional discrimination.
Merely arguing that the employer’s stated reason for the adverse employment action is unfair, implausible, or not identical to other discipline doesn’t automatically mean that illegal discrimination was present.
Tony Puckett is an attorney in the Oklahoma City, OK, office of McAfee & Taft. He may be reached at tony.puckett@mcafeetaft.com.
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