An employer’s simultaneous discharge of a husband, wife and daughter did not violate Title VII of the Civil Rights Act because familial status is not a protected category, according to the 10th U.S. Circuit Court of Appeals.
In 2002, the nonprofit corporation Multi-Community Diversified Services Inc. (MCDS) employed Barry Adamson as its CEO. That year, Adamson oversaw the incorporation of the wholly owned subsidiary Cartridge King of Kansas Inc. (CKK). After incorporating CKK, Adamson hired his wife, Patricia Adamson, to be CKK’s business manager and his daughter, Jessica Curl, to be CKK’s sales representative. Shortly after he hired his daughter and his wife, MCDS’ board of directors voted to terminate all three Adamsons.
They sued MCDS and CKK under Title VII, claiming that their discharge constituted sex discrimination because it was based on their status as “husband, wife and daughter.” The Adamsons noted that a father-son duo who worked for the company had not been terminated under the anti-nepotism policy.
The companies denied any liability, claiming the discharges were based on Mr. Adamson’s unilateral management style, his transfer of certain monies from MCDS to CKK and the board’s concern that the Adamsons’ employment relationships were ill-advised and in violation of the company’s anti-nepotism policy.
The trial court granted the companies’ motion for dismissal before trial, noting that it was “peculiar” for a husband and wife to argue simultaneously that their terminations were based on anti-male and anti-female animus. However, the trial court did not directly rule that familial status cannot support a sex discrimination claim under Title VII.
The 10th Circuit affirmed, but expanded on the ruling of the trial court by directly holding that familial status is not a protected category under Title VII.
In its analysis, the court noted that “familial status” is not based on sex any more than is being a “sibling” or “relative.” It is inherently gender-neutral. The court ruled that the Adamsons’ attempt to parse these classifications into subcategories of “husband, wife and daughter” does not change the fact that familial status is gender-neutral and does not elevate these subcategories to protected status under Title VII.
Accordingly, the 10th Circuit found that the companies did not violate Title VII in terminating the Adamsons pursuant to the anti-nepotism policy, despite the companies’ failure to terminate the father-son duo.
Adamson v. Multi-Community Diversified Services Inc ., 10th Cir., No. 05-3478 (Feb. 1, 2008).
Professional Pointer: While this case had a favorable ruling, it should still serve as a cautionary tale. Employers that fail to enforce their anti-nepotism policies with consistency may leave themselves open to liability or, at least, encourage litigation.
R. Alex Boals is an attorney with Kiesewetter Wise Kaplan Prather PLC , the Worklaw® Network member firm in Memphis, Tenn.
Editor’s Note: This article should not be construed as legal advice.