AutoZone Cleared of Race Bias in EEOC Suit Over Transfer

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By Kevin McGowan

AutoZone Inc. didn’t unlawfully discriminate based on race when it transferred a black sales manager from a store in a predominantly Hispanic neighborhood in Chicago to one in a predominantly black area ( EEOC v. AutoZone, Inc. , 2017 BL 210658, 7th Cir., No. 15-3201, 6/20/17 ).

The Equal Employment Opportunity Commission didn’t show former AutoZone manager Kevin Stuckey experienced an “adverse employment action” because the lateral transfer wouldn’t diminish his wages, benefits, or employment opportunities, the U.S. Court of Appeals for the Seventh Circuit said June 20. It affirmed a district court’s dismissal of the EEOC’s lawsuit under Title VII of the 1964 Civil Rights Act.

The decision is significant because it said even if an employer is accused of assigning or segregating a worker because of race, the EEOC must show the challenged action deprived or tended to deprive the individual of employment opportunities.

The EEOC argued if an employer tries to “limit, segregate, or classify” employees based on race, the agency doesn’t have to prove “adverse action” to raise a Title VII claim.

But that reading of Title VII “cannot be squared with the plain statutory text,” which requires a showing that a transfer or other challenged employment action would adversely affect the worker’s employment status, Judge Diane S. Sykes wrote for the Seventh Circuit. Judges Frank H. Easterbrook and Michael S. Kanne joined the opinion.

The EEOC declined to comment June 21. Attorneys representing the company didn’t respond to Bloomberg BNA’s request for comment.

Worker Balked at Transfer

Stuckey began working as an AutoZone sales manager in 2008.

In July 2012, Stuckey was working in a store in a largely Hispanic neighborhood in Chicago. His supervisor, who is also black, told Stuckey he was being transferred to a store on the city’s South Side, which has a predominantly black population.

But Stuckey chose to quit rather than accept the transfer. Stuckey alleged that when he asked Robert Harris, the AutoZone district manager, why he was being transferred, Harris said he was trying to “keep the Kedzie store predominantly Hispanic.”

Stuckey’s transfer didn’t entail any reduction in pay, benefits, or job responsibilities. He also admitted that Harris never mentioned Stuckey’s race or the race of any other AutoZone employee during their conversation.

EEOC Comes Up Short

The EEOC alleged AutoZone violated a Title VII provision making it unlawful for employers to “segregate” their workforce by race “in any way that would deprive or tend to deprive any individual of employment opportunities” or otherwise “adversely affect his status” as an employee.

No evidence of diminished employment opportunities or “adverse” effects on employment status is needed when an employer engages in such workforce segregation, the agency argued.

The EEOC’s interpretation “eliminates much of the statutory text,” the court said. Title VII requires “case-specific proof” an employer’s challenged action actually had adverse effects on an individual’s employment status or would “tend to deprive” that individual of employment opportunities, Sykes wrote.

Nothing suggested the July 2012 transfer “even tended to deprive” Stuckey of any job opportunity, the court said.

An EEOC attorney in Washington represented the commission. Jones Walker LLP and SmithAmundsen LLC represented AutoZone.

To contact the reporter on this story: Kevin McGowan in Washington at kmcgowan@bna.com

To contact the editors responsible for this story: Peggy Aulino at maulino@bna.com; Terence Hyland at thyland@bna.com; Chris Opfer at copfer@bna.com

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