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Labor: Cat’s paw theory can make individual employees liable

7th Circuit rules that Section 1981 of Civil Rights Act of 1866 provides for individual liability in certain circumstances

Employers are used to defending against traditional claims of discrimination or retaliation, in which an employee alleges that the employer violated Title VII of the Civil Rights Act of 1964, or some similar statute. In some cases, employers have to defend against the use of the “cat’s paw” theory of liability, which holds that an employer can be liable for discrimination or retaliation if the employer acts innocently but based on input from a biased employee. Employers will now have to become familiar with a less common scenario, in which an employee alleges that a co-worker is individually liable for causing the employer to retaliate against him or her under the Civil Rights Act of 1866, also known as Section 1981, which prohibits discrimination in contractual relationships.

On May 24, 2012, in Smith v. Bray, the 7th Circuit considered an issue of first impression: whether a former employee could sue a human resources manager individually for retaliating against him by influencing the decision to terminate his employment. The court held that the employee stated a viable claim against the HR manager for retaliating against him under a “cat’s paw” theory of liability. The court ruled, however, that the employee failed to establish a Section 1981 retaliation claim against the HR manager in that case because he could not show that the supervisor acted with retaliatory intent.

Contributing Author

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David Ritter

David B. Ritter is partner and chair of the Labor & Employment practice at Neal, Gerber & Eisenberg LLP, representing management in all areas of...

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