A “cat's-paw” theory of unlawful employment discrimination may arise where an employee argues that a biased non-decision-maker has influenced an unbiased decision-maker to take action that he or she otherwise would not have taken. On March 1, 2011, in Staub v. Proctor Hospital, the United States Supreme Court spoke for the first time on the issue, acknowledging the cat's-paw theory of liability and setting out a broad framework to be applied in such cases.

Prior to having his employment terminated, the plaintiff in Staub had been a technologist at the defendant Proctor Hospital (“Proctor”) and a member of the United States Army Reserve. He filed suit against Proctor, alleging that he was discharged based upon his military status, in violation of the Uniformed Services Employment and Reemployment Rights Act (“USERRA”). The hospital’s Vice-President of Human Resources had made the decision to terminate the plaintiff’s employment. Although the plaintiff conceded that that this senior employee had harbored no discriminatory animus on account of his military status, he contended that – under the “cat's paw” theory of liability – the anti-military bias of his immediate supervisors influenced the decision to terminate his employment, thus violating USERRA.

The Court began its analysis by indentifying the key issue: construing the phrase in USERRA ‘a motivating factor in the employer's action.’ The Court noted that a quandary arises when “the company official who makes the decision to take an adverse employment action” has “no discriminatory animus [e.g., animus based upon gender] but is influenced by previous company action that is the product of a like animus in someone else.”

The Court resolved this issue by holding that: “If the employer’s investigation results in an adverse action for reasons unrelated to the supervisor’s original biased action . . . then the employer will not be liable. But the supervisor’s biased report may remain a causal factor if the independent investigation takes it into account without determining that the adverse action was, apart from the supervisor's recommendation, entirely justified.” (emphasis added).

In short, Staub reiterates some fundamental lessons for employers. Establish and maintain clear and effective polices prohibiting workplace discrimination. Train all employees – particularly those with supervisory responsibility – on the scope of these policies to ensure that each employee knows what is prohibited. Establish clear procedures for reporting all instances of suspected discrimination, and investigate complaints when they are received. When appropriate, take corrective action to eliminate any discriminatory behavior. Document the ultimate rationale and basis used in making the decision – specifically discounting any discriminatory input. Finally, apply all rules consistently. Given the Court's requirement that employers must be able to show that their challenged decisions were “entirely justified,” an employer’s ability to establish that its supervisors apply rules uniformly should both: (a) undermine a traditional “disparate treatment” claim; and (b) satisfy Staub’s “entirely justified” standard.