In December 2012, the Iowa Supreme Court issued a controversial ruling in a sex discrimination case brought under Iowa law. In Nelson v. Knight, the court held 7–0 that a male employer may fire a female employee, though she did nothing wrong, because his wife was concerned about their relationship. Although critics maligned the decision as manifestly unfair, it is consistent with the case law. But one can envision fact patterns that might lead to a different outcome.
Nelson was a stellar dental assistant for Knight for 10 years. At some point they began texting about such innocuous matters as their children’s activities. Nelson (age 32) said she saw Knight (age 53) as a father figure and never sought an intimate relationship. Knight's wife learned of the texts, however, and demanded that he fire Nelson. He did so, in part because of that demand, but also because he said he wasn't sure he could avoid trying to have an affair with her otherwise.
Iowa law, on this point, is modeled after Title VII of the 1964 Civil Rights Act, which prohibits employers with at least 15 employees from discriminating against an employee because of his or her sex. To have a viable disparate treatment claim, a plaintiff must prove that he or she suffered an adverse employment action (e.g., termination or a promotion denial), and that sexual identity was a motivating factor in the action. A claim for disparate impact discrimination lies where an employer has a facially neutral practice that has a disproportionately negative impact on a specific gender and is not justified by business necessity.
Nelson advanced a straightforward “but-for” argument: she would not have been fired but for her gender. Knight said she was fired because of the perceived threat to his marriage. Nelson countered that the threat would not have existed had she not been female. After reviewing cases holding that an employer does not violate Title VII by firing a female employee involved in a consensual relationship that has triggered jealousy, although the relationship and jealousy presumably would not have existed had the employee been male, the court upheld the district court’s decision to grant summary judgment for Knight.
The ruling has been criticized on a number of grounds. One is that it sends the message that men cannot be held accountable for their sexual desires and women have to monitor and control their bosses’ urges; if these urges get out of hand, women can be legally fired. In the end, however, the court found a distinction between an isolated personnel decision based on personal relations (assuming no coercion or quid pro quo), even if the relations would not have existed had the employee been of the opposite sex, and a decision based on gender itself. The court also stressed that Knight hired Nelson and also replaced her with a woman, which indicates that sex did not motivate the termination decision.
The Knight court relied on Tenge v. Phillips Modern Ag. Co., where a business owner fired a valued employee at the urging of his wife. The difference was that Tenge “came on” to the owner so there were grounds for the wife’s suspicion of an intimate relationship. Noting that sexual favoritism – treating an employee better than the opposite sex because of a consensual relationship with the boss – does not violate Title VII because any benefits of the relationship are due to the employee’s sexual conduct, not gender, the court implicitly reasoned that treating an employee unfavorably due to such a relationship is legal.
In Platner v. Cash & Thomas Contractors, Inc., which was also cited, an employer fired a female employee who worked on the same crew as his son after the son’s wife became jealous of her. Concluding that the owner was faced with an escalating family conflict that he resolved by firing a non-relative instead of his son, the court found that Platner was fired, not because of her gender, but because of favoritism for a close relative. Nepotism is unfortunate, said the court, but it does not violate Title VII.
All of these courts stressed, as others have, that Title VII is not a general fairness law and an employer does not violate it by treating an employee unfairly as long as he or she does not act because of the employee’s protected status. This echoes U.S. Supreme Court Justice Scalia’s admonition in a 1998 sexual harassment case that Title VII is not a general workplace civility code. It is also consistent with the approach taken in a 2010 age discrimination case, where the U.S. Supreme Court held that a plaintiff can prevail only if he or she proves that age was not just a motivating factor in his or her termination, but the sole, or but-for, cause.
Nelson did not claim sexual harassment, although Knight engaged in questionable conduct, e.g., telling her that if she saw his pants bulging, she would know her clothing was too revealing, and saying, regarding her infrequent sex life, that it was like having a Lamborghini in the garage and never driving it. Sexual harassment is a form of sex discrimination. It may be quid pro quo, where a tangible employment action is conditioned on the granting of sexual favors, or a hostile environment, where an employee is subjected to conduct that is unwelcome and sufficiently severe or pervasive to alter the conditions of one's employment. Possibly, Nelson did not assert this claim because there was no evidence of an explicit or implicit quid pro quo or conduct that was non-consensual, unwelcome, severe, or pervasive in nature. Different facts, however, could support such a claim.
The outcome might also be different if one fires several female employees because his wife was jealous of them; then, one might infer that gender, not the relationship, was the cause of the terminations. This could fit into the disparate impact category. One could also run afoul of the gender stereotyping theory, which establishes that sex discrimination occurs if an employer evaluates employees by assuming or insisting that they match the stereotype associated with their group.
Recent case law is replete with examples of courts reading the “because of sex” language with increasing exactitude, largely due to the fear of making a Title VII case out of every arbitrary or unfair employment decision. The Knight case is consistent with this approach. What happened seems unfair, for had Nelson not been female Knight wouldn’t have had the feelings he had and she wouldn’t be out of a job. It is also, arguably, unsound business practice to fire a top-flight employee for the reasons Knight offered. In the end, however, the case reinforces the fact that unfair is one thing and illegally discriminatory is quite another.