The Supreme Court yesterday slightly enhanced the ability of some workers alleging intentional discrimination based on sex or race to win punitive damages.
By a 7 to 2 vote in a case involving a woman who was passed over for a promotion by the American Dental Association in favor of a man with less experience, the justices ruled that an employer's conduct need not be "egregious" to satisfy the law's requirements for punitive damages.
But the justices also declared, by a separate 5 to 4 vote in the same case, that companies need not pay punitive damages for supervisors' discriminatory conduct if the employer had made a good-faith effort to protect against bias on the job.
The law at issue in Kolstad v. American Dental Association says that once a worker has successfully made a case that a company intentionally discriminated, the worker can win punitive damages if it can be shown that the employer acted "with malice or with reckless indifference to the federally protected rights of an aggrieved individual." The D.C. Circuit had interpreted that to mean "particularly egregious violations" of Title VII of the 1964 Civil Rights Act.
But yesterday, the high court, in an opinion by Justice Sandra Day O'Connor, ruled that terms "malice" and "reckless indifference" focus on the state of mind of the supervisor, and do not require a showing of egregious or outrageous discrimination independent of that mind-set.
Chief Justice William H. Rehnquist and Justice Clarence Thomas dissented from the part of the rulings that said an employer's conduct need not be egregious for damages to apply. Dissenting from the part that lets companies off the hook for managers' discriminatory conduct if the employers made a good-faith effort to prevent bias were John Paul Stevens, David H. Souter, Ruth Bader Ginsburg and Stephen G. Breyer.