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Scott Wagner & Associates, P.A. Motto
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Failure to Promote: Legitimate Business Decision or Illegal Act of Discrimination?


Employment discrimination laws do not just apply to decisions regarding the hiring and firing of employees. They also apply to a company’s decisions on whether to promote existing employees. For example, if Company A decides not to promote an employee to a managerial rule because he is African American, that would constitute illegal discrimination under California and federal law. However, if a business can offer a legitimate reason for not promoting the employee–such as a lack of qualifications or experience relative to other candidates–that may absolve the employer of liability.

Ninth Circuit Revives Discrimination Lawsuit After Ruling Former Supervisor’s Statements to Plaintiff Were Admissible Evidence

Proving failure-to-hire discrimination can be difficult. A company may offer a seemingly legitimate, nondiscriminatory reason to mask their actual motives. In some cases, an employee may only hear through an informal channel that discrimination was the real reason they did not get the promotion.

But are such “back channel” statements admissible in court as evidence of illegal discrimination? A recent decision by the U.S. Ninth Circuit Court of Appeals in San Francisco, Weil v. Citizens Telecom Services Co., helps provide some context for how judges actually examine such questions.

The plaintiff in this lawsuit worked at the defendant’s call center. At one point, the defendant named the plaintiff as “interim acting director” of the call center. In this capacity, he reported directly to one of the defendant’s senior vice presidents (SVP). The SVP was also charged with finding a permanent director for the call center.

The plaintiff applied for the permanent position. The SVP ultimately interviewed three candidates for the job, ranking the plaintiff second. But prior to the final hiring decision, the company moved the SVP into a different position and appointed a new senior vice president. The new vice president ultimately hired a white female for the director’s job. A few months later, the defendant terminated the plaintiff’s employment, citing declines in his job performance.

This prompted the plaintiff to file a lawsuit. He alleged the defendant discriminated against him based on his sex and race, both in the failure to promote him and in the later decision to fire him. In a pretrial deposition, the plaintiff testified that the former senior vice president–the one removed prior to the final promotion decision–told him point-blank he did not get the director’s job because he was “not white” and “not female.”

The trial judge determined this statement was inadmissible hearsay and ultimately granted summary judgment to the defense. On appeal, the Ninth Circuit said the statement was admissible evidence and the plaintiff could proceed with his failure-to-promote allegation (but not his wrongful termination claim). As the appeals court explained, federal rules permit hearsay statements offered against the opposing party when three conditions are met:

  1. the statement was made by an “agent or employee” of the opposing party;
  2. the statement concerns a “matter within the scope of that employment relationship”; and
  3. the statement was made when the speaker was still employed by the opposing party.

It was the second element that proved critical in this case. The trial judge essentially believed that since the former SVP made her statement to the plaintiff after she was no longer his direct supervisor, the plaintiff could not prove the statement was made within the “scope” of her employment. The Ninth Circuit disagreed. It noted the key issue was whether the former SVP “was involved in a process leading up to a challenged decision, rather than focusing on whether [she] was a final decision-maker.”

Get Advice Regarding Employment Discrimination in California

If you suspect you are the victim of workplace discrimination, it is important to keep detailed notes and records that might assist you in bringing a claim later. Even a seemingly offhand remark from a former supervisor may prove important. If you have additional questions or concerns, contact a qualified California employment discrimination attorney right away.


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* Cathleen Scott is licensed to practice in Florida only.

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