EEOC settles landmark "cat's paw" discrimination case

When an adverse employment decision is made by a person who lacks impermissible bias, but was influenced by another individual who was motivated by such bias, is the employer liable for this rubber-stamped decision? While courts have not conclusively answered this question, the majority answer is yes. The leading case recognizing this theory of liability is EEOC v. BCI Coca-Cola Bottling Co. It famously describes this type of discrimination as "cat's paw" liability. "Cat's paw" derives from a fable in which a monkey tricks a cat into scooping chestnuts out of a fire so that the monkey can eagerly gobble them up, leaving none left for the cat. It generally describes a situation where one is unwittingly manipulated to do another's bidding.

Last week, the EEOC reported that it settled with BCI on behalf of Stephen Peters, the African-American employee on whose behalf it sued, for $250,000. BCI fired Peters back in 2001. The district court had found that the managers who actually fired Peters did not even know that he was black. The appellate court, however, concluded that a jury could reasonably conclude that the termination was based on Peters' race: "In making the decision to terminate ... the human resources official relied exclusively on information provided by Mr. Peters' immediate supervisor, who not only knew Mr. Peter's race but allegedly had a history of treating black employees unfavorably and making disparaging racial remarks in the workplace."

The "cat’s paw" theory of liability highlights the importance of employers conducting independent and thorough investigations prior to making any employment decision. Most courts that have adopted this theory of liability will not protect a decision maker's paper review of the decision without an independent investigation. Thus, instead of relying upon the recommendation of another, the actual decision maker should take such steps as interviewing the affected employee, independently interviewing other key witnesses, and personally reviewing relevant documents.