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No ‘manager rule’ protection for employer in Title VII

Roanoke’s Carilion Clinic must face a Title VII retaliation claim from a former EAP counselor who alleged he was fired in retaliation for not taking “the pro-employer side” with an employee who complained about sexual harassment.

The 4th U.S. Circuit Court of Appeals reversed dismissal of J. Neil DeMasters’ suit against Carilion, holding that the “manager rule” did not prevent an employee whose job duties included reporting discrimination claims from also seeking protection under Title VII’s anti-retaliation provision.

Three judges from the neighboring 3rd Circuit made up the panel in DeMasters v. Carilion Clinic. The court’s Aug. 10 opinion said that all members of the 4th Circuit were recused in the case. The court offered no reason for the recusal. Judge G. Steven Agee is married to Nancy Howell Agee, the CEO of Carilion Clinic.

DeMasters had worked for five years as a counselor with Carilion’s Employee Assistance Program when he assisted a John Doe employee who claimed sexual harassment by his male supervisor. Carilion fired the supervisor, but Doe alleged continuing hostility from co-workers loyal to the supervisor, and Doe later filed a Title VII suit. Carilion called DeMasters to task for his role in the counseling the employee, the suit said.

DeMasters alleged he was fired for acting “contrary to his employer’s best interests,” failing to take the “pro-employer side” and leaving his employer “in a compromised position” as a result of his support of the fellow employee’s sexual harassment complaint and DeMasters’ criticism of the way Carilion handled the complaint.

According to DeMasters, his EAP supervisor told him Carilion was angry at having to settle John Doe’s discrimination lawsuit and was looking to “throw somebody under the bus.”

The panel reversed Roanoke U.S. District Judge Michael Urbanski’s dismissal of DeMasters’ suit, saying courts had to take a “holistic approach” and use a “panoramic lens” when evaluating an employee’s “oppositional conduct” to discrimination. Using this perspective, the panel said DeMasters’ actions as whole constituted protected activity.

And the “manager rule,” derived from cases under the Fair Labor Standards Act, does not apply to Title VII cases, the panel said.

Under Carilion’s approach, “the categories of employees best able to assist employees with discrimination claims — the personnel that make up EAP, HR and legal departments — would receive no protection from Title VII if they oppose discrimination targeted at the employees they are duty-bound to protect,” wrote Judge Cheryl Ann Krause.

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