IN THE UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT Nos. 04-1026, 04-1264 LINDA K. LOVELL, Plaintiff, v. BBNT SOLUTIONS, LLC, and VERIZON COMMUNICATIONS, INC., Defendants. On Appeal from the United States District Court for the Eastern District of Virginia BRIEF OF THE EQUAL EMPLOYMENT OPPORTUNITY COMMISSION AS AMICUS CURIAE IN SUPPORT OF PLAINTIFF AND REVERSAL OF THE DISTRICT COURT ERIC S. DREIBAND U.S. EQUAL EMPLOYMENT General Counsel OPPORTUNITY COMMISSION 1801 L Street, N.W., Room 7012 VINCENT J. BLACKWOOD Washington, DC 20507 Acting Associate General Counsel (202) 663-4720 ELIZABETH E. THERAN Attorney TABLE OF CONTENTS TABLE OF AUTHORITIES . . . . . . . . . . . . . . . . . . . . .iii STATEMENT OF INTEREST. . . . . . . . . . . . . . . . . . . . . .1 STATEMENT OF THE ISSUE . . . . . . . . . . . . . . . . . . . . .2 STATEMENT OF THE CASE. . . . . . . . . . . . . . . . . . . . . .2 ARGUMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . .9 AN EMPLOYER DISCRIMINATES UNLAWFULLY WITH RESPECT TO COMPENSATION WHEN IT GRANTS AN EMPLOYEE A LOWER RAISE BECAUSE OF SEX WITHOUT REGARD TO THE DIFFERENCE BETWEEN THE RAISE AWARDED AND THE AMOUNT THAT WOULD HAVE BEEN AWARDED IN THE ABSENCE OF SEX DISCRIMINATION.. . . . . . . . . . . . . . . . . . . . . . . . .9 CONCLUSION . . . . . . . . . . . . . . . . . . . . . . . . . . 21 CERTIFICATE OF COMPLIANCE. . . . . . . . . . . . . . . . . . . 22 CERTIFICATE OF SERVICE . . . . . . . . . . . . . . . . . . . . 23 TABLE OF AUTHORITIES CASES Albemarle Paper Co. v. Moody, 422 U.S. 405 (1975). . 17-18, 19-20 Amro v. Boeing Co., 232 F.3d 790 (10th Cir. 2000). . . . . . . 15 Bazemore v. Friday, 478 U.S. 385 (1986). . . . . . . . . . . . 10 Brinkley-Obu v. Hughes Training, Inc., 36 F.3d 336 (4th Cir. 1994)10 Buckhannon Bd. & Care Home, Inc. v. W. Va. Dep't of Health & Human Res., 532 U.S. 598 (2001). . . . . . . . . . . . . . . . . . . . . . . . 19 Dennis v. Columbia Colleton Med. Ctr., Inc., 290 F.3d 639 (4th Cir. 2002)18, 19 EEOC v. Korn Indus., Inc., 662 F.2d 256 (4th Cir. 1981). . .16-17 Fierros v. Tex. Dep't of Health, 274 F.3d 187 (5th Cir. 2001). 14 Gregory v. Daly, 243 F.3d 687 (2d Cir. 2001) . . . . . . . . . 14 Gumbhir v. Curators of the Univ. of Mo., 157 F.3d 114 (8th Cir. 1998)14 Gupta v. Fla. Bd. of Regents, 212 F.3d 571 (11th Cir. 2000). . 14 Hildebrandt v. Ill. Dep't of Natural Res., 347 F.3d 1014 (7th Cir. 2003)15 Hill v. Lockheed Martin Logistics Mgmt., Inc., 354 F.3d 277 (4th Cir. 2004) (en banc). . . . . . . . . . . . . . . . . . . . . . . . . . . 13 Hishon v. King & Spalding, 467 U.S. 69 (1984). . . . . . . .14-15 Jenkins v. United Gas Corp., 400 F.2d 28 (5th Cir. 1968) . . . 17 Kersting v. Wal-Mart Stores, Inc., 250 F.3d 1109 (7th Cir. 2001)14 Lovejoy-Wilson v. NOCO Motor Fuel, Inc., 263 F.3d 208 (2d Cir. 2001)19 McCann v. Fairfax County Gov't, 32 F. Supp. 2d 365 (E.D. Va. 1998))16 Milligan v. Citibank, N.A., No. 00 Civ. 2793, 2001 WL 1135943 (S.D.N.Y. Sept. 26, 2001). . . . . . . . . . . . . . . . . . . 16 Nealon v. Stone, 958 F.2d 584 (4th Cir. 1992). . . . . . . . . 10 Nat'l R.R. Passenger Corp. v. Morgan, 536 U.S. 101 (2002). . . 11 Rabinovitz v. Pena, 89 F.3d 482 (7th Cir. 1996). . . . . . . . 14 Ray v. Henderson, 217 F.3d 1234 (9th Cir. 2000). . . . . . . . 12 Rowlett v. Anheiser-Busch, Inc., 832 F.2d 194 (1st Cir. 1987). 15 Taylor v. Small, 350 F.3d 1286 (D.C. Cir. 2003). . . . . . . . 15 Von Gunten v. Maryland, 243 F.3d 858 (4th Cir. 2001) . . . . . 12 White v. Burlington N. & Santa Fe Ry. Co., 364 F.3d 789 (6th Cir. 2004) (en banc). . . . . . . . . . . . . . . . . . . . . . . . . 12, 19 Wicker v. Hoppock, 73 U.S. (6 Wall.) 94 (1867) . . . . . . . . 18 STATUTES 29 U.S.C. 216(d) . . . . . . . . . . . . . . . . . . . . . . .2 42 U.S.C. 2000e et seq. . . . . . . . . . . . . . . . . . 1, 2 42 U.S.C. 2000e-2(a)(1). . . . . . . . . . . . . . . . . .9, 13 42 U.S.C. 2000e-3. . . . . . . . . . . . . . . . . . . . .11-12 42 U.S.C. 2000e-5(f) . . . . . . . . . . . . . . . . . . . . 17 42 U.S.C. 12203. . . . . . . . . . . . . . . . . . . . . . . 19 OTHER AUTHORITIES Fed. R. App. P. 29(a). . . . . . . . . . . . . . . . . . . . . .2 Fed. R. App. P. 29(d). . . . . . . . . . . . . . . . . . . . . 22 Fed. R. App. P. 32(a)(7)(B). . . . . . . . . . . . . . . . . . 22 Section 8, Retaliation, 2 EEOC Compliance Manual (BNA) (2003) (available at http://www.eeoc.gov/policy/compliance.html). . . 12 IN THE UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT Nos. 04-1026, 04-1264 LINDA K. LOVELL, Plaintiff, v. BBNT SOLUTIONS, LLC, and VERIZON COMMUNICATIONS, INC., Defendants. On Appeal from the United States District Court for the Eastern District of Virginia BRIEF OF THE EQUAL EMPLOYMENT OPPORTUNITY COMMISSION AS AMICUS CURIAE IN SUPPORT OF PLAINTIFF AND REVERSAL OF THE DISTRICT COURT STATEMENT OF INTEREST The Equal Employment Opportunity Commission is the agency established by Congress to administer, interpret, and enforce Title VII of the Civil Rights Act of 1964, 42 U.S.C. 2000e et seq. Because this case raises an important issue concerning the scope of Title VII's prohibition, and because a ruling on this issue will affect other Title VII plaintiffs, the Commission offers its views to the Court pursuant to Fed. R. App. P. 29(a). STATEMENT OF THE ISSUE Whether the district court erred in holding that the defendants did not violate Title VII when they gave the plaintiff a lower raise because of her sex. STATEMENT OF THE CASE 1. Nature of the Case and Course of Proceedings This is an appeal from a final judgment of the district court awarding relief to the plaintiff on some of her claims, but granting judgment for the defendants on her claim that they violated Title VII by granting her a lower raise because of her sex, notwithstanding the jury's verdict in her favor on this claim. The plaintiff initiated this action by filing a complaint on March 4, 2003, alleging claims against the defendants under Title VII of the Civil Rights Act of 1964, 42 U.S.C. 2000e et seq., and the Equal Pay Act, 29 U.S.C. 216(d). 1 Joint Appendix ("J.A.") 15. The complaint alleges that the defendants violated Title VII by granting the plaintiff a lower raise in 2002 because of her sex, and that they violated both Title VII and the Equal Pay Act by paying her less than male employees performing equal work. Id. After the district court denied the defendants' motion for summary judgment on these claims (1 J.A. 478), the case proceeded to trial before a jury. On September 2, 2003, the jury returned a verdict in favor of the plaintiff on all three claims submitted, and awarded the plaintiff a total of $400,000 for her two Title VII claims and $100,000 for her Equal Pay Act claim. 3 J.A. 1286-88. On December 11, 2003, the court granted the defendants' motion for judgment as a matter of law on the plaintiff's claim that she was granted a lower raise because of her sex, holding that this did not constitute a violation of Title VII. Id. at 1454, 1474-77. The court denied the defendants' motion with respect to the plaintiff's claim that she was paid a lower salary because of her sex; however, the court lowered the total monetary award to the plaintiff to $3,125, plus interest. Id. at 1478-82. Both parties have appealed. 1 J.A. 12, 13. 2. Statement of Facts Plaintiff Linda K. Lovell began working at BBNT Solutions ("BBN") as a materials engineer in January 1994. 1 J.A. 36. At the time she was hired, Lovell requested, and received, a reduced-hour work schedule of 25 hours per week. 2 J.A. 598. Since early 1995, she has worked 30 hours per week rather than the standard 40, and her salary has been prorated accordingly. Id. As of 2001, Lovell's annual salary was $73,500. 1 J.A. 280. According to Lovell, during the entire course of her employment at BBN, her supervisors treated her and other female subordinates differently from their male colleagues in a number of ways: by berating them in front of coworkers and customers, by micromanaging them, and by laughing and otherwise ridiculing statements made by women at meetings. See 2 J.A. 779-80 (belittling female employees and laughing and rolling his eyes at them at meetings), 667 (micromanagement); R. 43 (Pl.'s Resp. in Opp. to Def.'s Mot. for Summ. J.) (hereinafter "Opp. Summ. J."), Ex. 1 (Lovell affidavit), at 1 (berating female employees in front of customer). Lovell testified that, despite her repeated requests, her supervisors refused to assign her a comparable number of billable hours to those worked by her male colleagues. 2 J.A. 612-13, 635. Accordingly, in order to comply with the billable-hour goals set for her, she was forced to generate her own work by "rainmaking," which was itself not billable, while her male coworkers were assigned billable work on pre-existing projects. 2 J.A. 616, 655. Lovell also testified that a supervisor, Pete Gauthier, would assign billable hours on her projects to her male coworkers without consulting her. Id. at 616-18. Moreover, Lovell was the only employee in her group who did not have a laptop supplied to her by BBN, despite her repeated requests for one. Id. at 720-21. Finally, Lovell testified that she was excluded from project meetings and training sessions to which all of the men in the group were invited. Id. at 722-24. In November 2001, Jay Miner, Lovell's supervisor and group leader, criticized Lovell's September 2001 handling of a purchase requisition on the grounds that she had failed to follow proper procedure by getting "formal management approval" for the requisition. 2 J.A. 671-72, 915-17. Miner documented his criticism in Lovell's year- end performance assessment for 2001, in which he wrote that "[o]n one occasion during the year [Lovell] mistakenly obligated a large sum of funding without preparing the necessary requisitions for senior management/finance approval." 1 J.A. 265, 267. Lovell maintained that she had followed similar procedures on her prior projects and that Miner's reprimand in November 2001 was the first time that she had heard any directions to the contrary. 2 J.A. 671-72. She requested that Miner provide her with training on the proper procedure. R. 43 (Opp. Summ. J.), Ex. 12 (Lovell deposition), at 177, 180. At BBN, employees receive year-end performance reviews in which they are rated in six performance categories, on the following scale: Exceptional (EX), With Distinction (WD), High Standard (HS), Room for Improvement (RI), and Not Adequate (NA). 1 J.A. 267. The High Standard category is "a term that BBN has coined to mean average." 2 J.A. 943. Once a performance rating is finalized, the department manager uses the appraisal to set the employee's salary and raise, if any, for the coming year. Id. at 877-78. At Lovell's peer review meeting for 2001, which occurred in the spring of 2002, Jude Nitsche, the manager of Lovell's department, rated most aspects of Lovell's performance "High Standard," with two exceptions: he gave her a rating of "With Distinction" in the category of customer focus, which counted for 10% of her overall score, but gave her a rating of "Room for Improvement" ("RI") in the "overall performance" category, which counted for 60% of her score. 1 J.A. 267-68 (Lovell's evaluation, explaining different categories of ratings); 2 J.A. 943 (RI rating). As a result, Lovell's overall rating was "RI." Based on this rating, Nitsche then set Lovell's raise for 2002 at $1,000, bringing her salary to $74,500. Id. at 973. This constituted a raise of 1.36% of her 2001 salary, the lowest percentage raise in her group. 1 J.A. 280, 2 J.A. 230-31. An employee who receives a rating of "HS" ordinarily receives a raise of between 4 and 6 percent. 2 J.A. 665. If she had received a raise in this range, Lovell would have received an increase of between $2,940 and $4,410, or between $1,940 and $3,410 more than she actually received. Miner subsequently decided to raise Lovell's "overall performance" rating from RI to HS because he decided that "it would be demotivating for her to all of a sudden get a lower rating." 2 J.A. 895. However, he made no effort to change the amount of her raise because he "still felt that there were performance issues that remained." Id. At trial, Nitsche testified that he also took no steps to change the amount of Lovell's raise because he "felt that the changing from needs improvement to high standard was simply a cosmetic thing to do so as not to impact her mentally, in the sense of upsetting her." Id. at 945. He explained, "[T]his transgression, this mistake, needed to be brought to her attention. And that's the fundamental best way to make it stick." Id. at 975. Nitsche acknowledged at trial that the sole performance issue in question was the incident involving the requisition in September 2001. Id. at 944. 3. District Court Decision The district court granted BBN's motion for judgment as a matter of law on Lovell's claim that she was granted a lower pay raise in 2002 because of her sex. The court noted that "plaintiff cannot claim she was denied a pay increase in 2002." 3 J.A. 1475. According to the court, Lovell "concedes that in receiving the pay raise she received a benefit, but she thinks she should have received an even greater benefit." Id. The court stated, "Absent a very large disparity between the raise given a claimant and the raises given to valid comparators, which is not the case here, it is difficult to see how a raise in one's salary could constitute an adverse employment action." Id. (emphasis in original; footnote and internal quotation marks omitted). The court acknowledged that "[t]here may be situations where low pay raises are so consistent or their monetary significance in proportion to salary so substantial that they rise to the level of an adverse employment action." Id. at 1476. The court gave the following example: "if an employer were to grant an employee a minimal raise of say only $100, while granting her valid comparators raises in excess of $10,000, such action may cross the adverse employment action threshold." Id. at 1475 n.14. However, the court concluded, the finding in this case that Lovell "at most . . . fail[ed] to receive an additional $3,410" because of her sex was not such a situation. Id. at 1476. The court concluded that "where, as here, plaintiff receives a non-trivial raise and incentive pay resulting in a significant increase in her compensation, her pay raise does not adversely affect the terms, conditions, or benefits of her employment." Id. at 1477 (emphasis in original). ARGUMENT AN EMPLOYER DISCRIMINATES UNLAWFULLY WITH RESPECT TO COMPENSATION WHEN IT GRANTS AN EMPLOYEE A LOWER RAISE BECAUSE OF SEX WITHOUT REGARD TO THE DIFFERENCE BETWEEN THE RAISE AWARDED AND THE AMOUNT THAT WOULD HAVE BEEN AWARDED IN THE ABSENCE OF SEX DISCRIMINATION. Section 703(a)(1) of Title VII provides that it shall be "an unlawful employment practice for an employer . . . to discriminate against any individual with respect to his compensation . . . because of such individual's race, color, religion, sex, or national origin . . . ." 42 U.S.C. 2000e-2(a)(1). Lovell alleges, and the jury found, that her pay increase for 2002 was up to $3,410 lower because of her sex. It necessarily follows from this finding that Lovell's compensation for 2002 was lower by this amount because of her sex. It is undisputed that the consequence of the decision to give Lovell a 1.36% raise in 2002 rather than the 4 to 6 percent raise normally given to an employee with a satisfactory performance rating was that she received lower compensation in 2002 and thereafter. It therefore follows from the jury's verdict that BBN decided to give Lovell a lower raise because of her sex, that BBN thereby provided her with lower compensation because of her sex. Since section 703(a)(1) expressly prohibits an employer like BBN from discriminating against an individual in compensation, BBN's action constitutes a clear violation of the terms of the statute. See, e.g., Bazemore v. Friday, 478 U.S. 385, 395 (1986) ("[e]ach week's paycheck that delivers less to a black than to a similarly situated white is a wrong actionable under Title VII"); Brinkley-Obu v. Hughes Training, Inc., 36 F.3d 336, 347 (4th Cir. 1994) (holding that, under Equal Pay Act and Title VII, "each issuance of a paycheck to a female employee at a lower wage than that issued to her male counterpart constitutes a new discriminatory action") (citing Nealon v. Stone, 958 F.2d 584, 592 (4th Cir. 1992)). The district court held, however, that BBN did not violate Title VII even if it reduced Lovell's raise because of her sex. According to the court, because the raise Lovell received in 2002 was not "trivial" and she received a "significant increase" in total compensation for that year, if her incentive pay is included, she cannot establish that the discriminatory raise adversely affected the "terms, conditions, or benefits of her employment." 3 J.A. 1476. This conclusion is based on a flawed understanding of the prohibitions of Title VII. Because Title VII expressly prohibits sex discrimination in compensation, there was no reason for the district court to consider whether the compensation discrimination found by the jury was of sufficient magnitude to alter the "terms," "conditions," or "benefits" of Lovell's employment. The prohibition in section 703(a)(1) on discrimination with respect to the "terms, conditions, or privileges of employment" was clearly intended to supplement that section's prohibition of specifically enumerated tangible employment practices by prohibiting other, less tangible actions that adversely affect employees. See, e.g., Nat'l R.R. Passenger Corp. v. Morgan, 536 U.S. 101, 115-16 (2002) ("We have repeatedly made clear that although [Title VII] mentions specific employment decisions with immediate consequences, the scope of the prohibition is not limited to 'economic' or 'tangible' discrimination, . . . and that it covers more than 'terms' and 'conditions' in the narrow contractual sense.") (internal citations and quotation marks omitted). The district court erroneously treated the prohibition of discrimination in the "terms, conditions, and privileges" of employment as a limitation on the prohibition of discrimination in compensation, rather than a supplement to it. The district court appears to have misapplied cases holding that employer conduct does not violate Title VII unless it constitutes an "adverse action" or a "materially adverse action." This case law originated with cases involving claims of retaliation under 704 of Title VII. 42 U.S.C. 2000e-3. Section 704, unlike section 703, does not expressly prohibit specific employment practices, but instead broadly prohibits an employer from "discriminat[ing]" against an employee for engaging in protected activity. Because the language of section 704 could be read to sanction claims challenging even the slightest distinction between persons who filed charges and those who did not, courts "developed the adverse-employment-action element to prevent the kind of claims based upon trivial employment actions that a strictly literal reading of Title VII's anti-retaliation provision would allow." White v. Burlington N. & Santa Fe Ry. Co., 364 F.3d 789, 799 (6th Cir. 2004) (en banc). In section 703, by contrast, Congress enumerated several specific prohibitions in addition to the catchall prohibition on discrimination "with respect to [] terms, conditions, or privileges of employment." Section 703(a) provides that it is an "unlawful employment practice" for an employer to: "fail or refuse to hire" an individual; to "discharge" an individual, or to "discriminate against any individual with respect to his compensation . . ." because of the individual's race, color, religion, sex, or national origin. 42 U.S.C. 2000e-2(a)(1). Where, as here, a plaintiff establishes that an employer committed one of these specific prohibited acts, Congress has declared that this conduct constitutes an "unlawful employment practice." Accordingly, there is no basis in such a case for a court to consider, as the district court did in this case, whether the conduct is serious enough to constitute an actionable "adverse employment action." Neither this Court nor any other court of appeals has held that conduct by an employer that contravenes one of the specific prohibitions of section 703(a) is not actionable because it is not sufficiently adverse. On the contrary, courts have consistently held that Title VII prohibits discriminatory actions that cause an employee to suffer a loss of compensation. As the district court noted, numerous courts have held that Title VII prohibits an employer from denying an employee a raise based on a prohibited characteristic. See, e.g., Fierros v. Tex. Dep't of Health, 274 F.3d 187, 193- 94 (5th Cir. 2001) (finding it "illogical to construe Title VII as prohibiting discriminatory decreases in pay, but permitting discriminatory denials of pay increases"); Gregory v. Daly, 243 F.3d 687, 701 (2d Cir. 2001) (characterizing a denied pay raise as adverse action); Kersting v. Wal-Mart Stores, Inc., 250 F.3d 1109, 1115-16 (7th Cir. 2001) (denial of a raise may constitute a materially adverse action "because a raise may be a normal and expected element of a worker's salary . . . that keeps his wages from falling in real terms") (internal citations and quotation marks omitted); Gupta v. Fla. Bd. of Regents, 212 F.3d 571, 590 (11th Cir. 2000) (denial of a raise is adverse action because it "clearly" affects compensation); Gumbhir v. Curators of the Univ. of Mo., 157 F.3d 1141, 1144 (8th Cir. 1998) (characterizing as "frivolous" the defendant's contention that denying the plaintiff a raise did not constitute an adverse employment action). As at least three other courts of appeals have recognized, there is no legal or logical basis for treating a disparate raise i.e., one that provides an employee with a lower pay increase on the basis of a protected trait any differently from a denied raise. See, e.g., Hildebrandt v. Ill. Dep't of Natural Res., 347 F.3d 1014, 1030 (7th Cir. 2003) (plaintiff "suffered an adverse employment action, namely a paycheck reflecting her 1997 salary which was determined with a lower raise than that given her coworkers"); Amro v. Boeing Co., 232 F.3d 790, 798 (10th Cir. 2000) (to establish a Title VII wage discrimination claim, a plaintiff must show "that he was paid less, or given a lesser raise, than other similarly situated non-protected class employees."); Rowlett v. Anheiser-Busch, Inc., 832 F.2d 194, 202 (1st Cir. 1987) (affirming district court's finding that plaintiff "established a prima facie case by showing that he received smaller raises than the white foremen received"). We are aware of no contrary authority among the federal circuit courts. Quite apart from the district court's analytical error in this case, the court's conclusion that Title VII condones a discriminatory employment action that results in thousands of dollars in lost wages is completely antithetical to the purpose of the statute as discerned by the courts, including this Court. The district court suggests that plaintiff brought this claim merely because she is "disappointed over not receiving a higher raise" and that "[t]here is no warrant for allowing Title VII to be used in this manner because the magnitude of the raise differential in this case" as much as $3,400 each year that Lovell remains employed by BBN is too small to warrant redress under the statute. 3 J.A. 1476. This Court has emphatically rejected this notion that there is some sort of "de minimis" rule for Title VII compensation claims. In EEOC v. Korn Industries, Inc., the district court, after finding that the defendant discriminated on the basis of race in assigning new employees, had held that only individuals who lost at least $50 as a result of this discrimination could recover back pay. 662 F.2d 256, 263 (4th Cir. 1981). This Court reversed, stating, "[t]he injury was to a substantial right and we are aware of no principle that would permit it to go uncompensated merely because the ultimate economic damage was less than fifty dollars." Id. at 264. This Court quoted Jenkins v. United Gas Corp., 400 F.2d 28, 32 (5th Cir. 1968), and observed that "[w]hat is small in principal is often large in principle." Korn, 662 F.2d at 264. This Court added that "[e]mployees are to be made whole for injuries suffered through past discrimination, and make whole relief is not limited to those with large claims." Id. (internal citations omitted). See also Jenkins, 400 F.2d at 32 (reversing district court's dismissal of Title VII action alleging widespread race discrimination in employment) ("In dollars Employee's claim for past due wages may be tiny. But before a Court as to which there is no jurisdictional minimum ( 706(f), 42 U.S.C. 2000e-5(f)), it is enough on which to launch a full scale inquiry into the charged unlawful motivation in employment practices."). It is beyond dispute that one of the core purposes of Title VII was to provide redress for persons who suffered economic injury as a result of employment discrimination. As the Supreme Court observed in Albemarle Paper Co. v. Moody: Title VII deals with legal injuries of an economic character occasioned by racial or other antiminority discrimination. . . . And where a legal injury is of an economic character, "(t)he general rule is, that when a wrong has been done, and the law gives a remedy, the compensation shall be equal to the injury. The latter is the standard by which the former is to be measured. The injured party is to be placed, as near as may be, in the situation he would have occupied if the wrong had not been committed." 422 U.S. 405, 418 (1975) (quoting Wicker v. Hoppock, 73 U.S. (6 Wall.) 94, 99 (1867)). See also Dennis v. Columbia Colleton Med. Ctr., Inc., 290 F.3d 639, 651 (4th Cir. 2002) ("Back pay is awarded in furtherance of the objectives of Congress in enacting Title VII to create employer incentives to ensure equality of employment opportunities and to make persons whole for injuries suffered on account of unlawful discrimination.") (citing Albemarle, 422 U.S. at 418-19). As a result of BBN's decision to reduce her raise because of her sex, as the jury found Lovell suffered an economic injury each time she received a paycheck reflecting this reduced raise. The district court's decision to deny Lovell any Title VII remedy for this proven discrimination cannot be reconciled with the Supreme Court's unambiguous mandate to construe Title VII to provide a remedy for economic harm caused by employment practices made unlawful by the statute. Even in retaliation cases, where the magnitude of the harm is relevant to determining whether employer conduct is actionable, courts have not hesitated to hold that actions causing even slight economic loss to the plaintiff are actionable. See, e.g., Burlington N., 364 F.3d at 802 (37-day suspension without pay followed by reinstatement with back pay was a "materially adverse action" because plaintiff lost the use of her income for that time); Lovejoy-Wilson v. NOCO Motor Fuel, Inc., 263 F.3d 208, 224 (2d Cir. 2001) (plaintiff who was suspended for a week without pay and later reimbursed "may have at least suffered the loss of the use of her wages for a time[, which] would be sufficient to support a jury's finding that she suffered an adverse action" under retaliation provision of the Americans with Disabilities Act). Cf. Dennis, 290 F.3d at 652-53 (in Title VII case, observing that the Supreme Court has defined "prevailing party" as "a party in whose favor a judgment is rendered, regardless of the amount of damages awarded") (citing Buckhannon Bd. & Care Home, Inc. v. W. Va. Dep't of Health & Human Res., 532 U.S. 598, 603 (2001)). In Albemarle, the Court held, "given a finding of unlawful discrimination, backpay should be denied only for reasons which, if applied generally, would not frustrate the central statutory purposes of eradicating discrimination throughout the economy and making persons whole for injuries suffered through past discrimination." 422 U.S. at 421. The Court held that, in light of this principle, it was an abuse of discretion for the court to deny back pay in that case on the ground that the employer did not act in bad faith. The district court in this case went further than the district court in Albemarle. The court did not just deny Lovell back pay for the discrimination found by the jury; it entered judgment for the defendant. Indeed, the district court specifically acknowledged that the evidence supported the jury's verdict that sex discrimination infected the lower raise plaintiff received. 3 J.A. 1477-78 n.18. The only reason the court gave for its action was its view that the amount of Lovell's lost wages was not of sufficient magnitude to warrant judicial intervention. Unless the district court's order is reversed, Lovell will be denied redress not only for the discriminatory raise itself, but for its compounding effect on her pay throughout her subsequent employment at BBN. This result would be antithetical to the fundamental principles underlying Title VII. CONCLUSION For the foregoing reasons, the Commission urges this Court to reverse the district court's judgment on Lovell's Title VII disparate-raise claim and to remand the case for further proceedings. Respectfully submitted, ERIC S. DREIBAND General Counsel VINCENT J. BLACKWOOD Acting Associate General Counsel ________________________ ELIZABETH E. THERAN Attorney U.S. EQUAL EMPLOYMENT OPPORTUNITY COMMISSION Office of General Counsel 1801 L Street, N.W., Room 7012 Washington, D.C. 20507 (202) 663-4720 CERTIFICATE OF COMPLIANCE I, Elizabeth E. Theran, hereby certify that this brief complies with the type- volume limitations imposed under Fed. R. App. P. 32(a)(7)(B)(i) and 29(d). This brief contains 5176 words, excluding the parts of the brief exempted by Fed. R. App. P. 32(a)(7)(B)(iii). The brief has been prepared in a proportionally spaced typeface using WordPerfect 9.0 in 14-point Times New Roman for both text and footnotes. _______________________ Elizabeth E. Theran CERTIFICATE OF SERVICE I, Elizabeth E. Theran, hereby certify that I served two copies of the foregoing brief and one copy of my completed appearance of counsel form this 7th day of July, 2004, by first-class mail, postage pre-paid, to the following counsel of record: Counsel for Plaintiff David H. Shapiro Ellen K. Renaud Swick & Shapiro, P.C. 1225 Eye St., N.W. Washington, DC 20005 (202) 842-0300 Counsel for Defendants Jonathan P. Harmon McGUIREWOODS, LLP One James Center 901 East Cary St. Richmond, VA 23219-4030 (804) 775-7345 _____________________ Elizabeth E. Theran Attorney U.S. EQUAL EMPLOYMENT OPPORTUNITY COMMISSION Office of General Counsel 1801 L Street, N.W., Room 7012 Washington, D.C. 20507 (202) 663-4720 _____________________________ 1 We take no position with respect to any other issue presented in this appeal. 2 The complaint also alleged that the defendant subjected the plaintiff to a hostile work environment based on sex and retaliated against her for complaining about her 2002 raise. These claims were dismissed by the court on summary judgment (1 J.A. 478) and are not addressed in this brief. 3 Defendant BBNT Solutions, LLC, is a legal entity that does business as BBN Technologies, a subsidiary of Verizon Communications, Inc. Hereinafter, all references to “defendant” and “BBN” may be taken to refer to both defendants. 4 According to Lovell, she has generally worked more than 30 hours per week, but her compensation is based on a 30-hour work week. E.g., 2 J.A. 615 (“I worked a minimum 30 hour week.”), 643 (marketing efforts in excess of 30 hours per week). 5 Citations to the record proper are abbreviated “R.” and refer to the district court docket entry number. See 1 J.A. 1-14 (district court docket sheet). 6 A BBN official testified that a laptop was finally purchased for Lovell in the summer of 2003, just before the trial in this case, but she had not yet received it because they were “waiting to coordinate with Linda to install it.” 2 J.A. 892-93. 7 Assuming Lovell received nondiscriminatory raises after 2002, this sex-based disparity in compensation would be carried forward for each succeeding year of her employment. Furthermore, because pay increases at BBN are based on a percentage of an employee’s present salary, the sex-based disparity in Lovell’s salary will be compounded each year, even if she receives a non-discriminatory percentage raise in subsequent years. 8 The Commission agrees that “petty slights and trivial annoyances are not actionable” under § 704. Section 8, Retaliation, 2 EEOC Compliance Manual, at 27 (BNA) (2003) (available at http://www.eeoc.gov/policy/compliance.html). However, the Commission takes the position that the appropriate way of screening out such claims is not by rejecting claims based on the nature of the employer’s action, but by limiting § 704 to employer conduct that “might deter a reasonable person from engaging in protected activity.” Id.; see also Ray v. Henderson, 217 F.3d 1234, 1243 (9th Cir. 2000) (adopting EEOC standard). This Court has disagreed with the Commission’s approach to retaliation complaints and requires a plaintiff to establish that retaliatory conduct constitutes a “materially adverse employment action.” See, e.g., Von Gunten v. Maryland, 243 F.3d 858, 865 (4th Cir. 2001). However, this disagreement over the scope of § 704’s broad prohibition on “discriminat[ion]” is not relevant to the issue in this appeal, which involves a challenge to conduct prohibited by the express terms of § 703 of Title VII. 9 This is not to say, of course, that a plaintiff’s establishing the existence of a discrepancy in compensation automatically suffices to send the case to a jury. A plaintiff claiming disparate compensation, like any other Title VII plaintiff, must also establish that discrimination was the employer’s motivation for the difference in pay. See Hill v. Lockheed Martin Logistics Mgmt., Inc., 354 F.3d 277, 284-85 (4th Cir. 2004) (en banc) (setting forth “mixed-motive” and “pretext” avenues of proof under Title VII). In order to survive summary judgment, a plaintiff will have to adduce evidence sufficient to demonstrate a genuine issue of material fact on both points. In this case, as the district court observed, Lovell met that burden. 3 J.A. 1477-78 n.18. 10 Only one circuit, the Seventh, has held that a denial of compensation is not actionable. See, e.g., Rabinovitz v. Pena, 89 F.3d 482, 488-89 (7th Cir. 1996). In that case, the court stated that “the loss of a bonus is not an adverse employment action in a case . . . where the employee is not automatically entitled to the bonus.” This statement cannot be reconciled with the Supreme Court’s holding in Hishon v. King & Spalding: A benefit that is part and parcel of the employment relationship may not be doled out in a discriminatory fashion, even if the employer would be free under the employment contract simply not to provide the benefit at all. Those benefits that comprise the “incidents of employment” . . . may not be afforded in a manner contrary to Title VII. 467 U.S. 69, 75-76 (1984) (internal citations omitted). The D.C. Circuit has recognized that “loss of bonus money because of an improperly low performance rating may constitute an adverse employment action for the purposes of Title VII.” Taylor v. Small, 350 F.3d 1286, 1293 (D.C. Cir. 2003). In any event, as discussed below, the Seventh Circuit, despite its ruling on bonuses, has held expressly that granting an employee a lower raise for a discriminatory reason violates Title VII. See Hildebrandt v. Ill. Dep’t of Natural Res., 347 F.3d 1014, 1030 (7th Cir. 2003) (plaintiff “suffered an adverse employment action, namely a paycheck reflecting her 1997 salary which was determined with a lower raise than that given her coworkers”). 11 The district court cited two district court decisions as supporting its holding. 3 J.A. 1475-76 (citing Milligan v. Citibank, N.A., No. 00 Civ. 2793, 2001 WL 1135943, at *4 (S.D.N.Y. Sept. 26, 2001); McCann v. Fairfax County Gov’t, 32 F. Supp. 2d 365, 368 (E.D. Va. 1998)). Milligan makes the same mistake as the court in this case by overlooking the fact that a discriminatorily low raise constitutes discrimination in compensation. McCann is inapposite. Although the court observed, as the district court notes, that “[a] pay increase obviously is a benefit, not an adverse action,” the plaintiff in that case did not allege that her raise was lowered for a discriminatory reason; she challenged only some of the statements in the performance evaluation that supported the raise. Accordingly, the decision does not stand for the proposition that an employer does not violate Title VII by awarding an employee a lower raise for a discriminatory reason. 12 Like section 704(a) of Title VII, section 503(a) of the ADA prohibits, without limitation, an employer from “discriminat[ing]” against a person for engaging in protected activity. 42 U.S.C. § 12203.