Caseflicks

Supreme Court of the United States • 1984

Hishon v. King & Spalding

467 U.S. 69 | 104 S. Ct. 2229 | 81 L. Ed. 2d 59 | 1984 U.S. LEXIS 7 | 52 U.S.L.W. 4627

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Takeaway

In short, this case holds that a law firm may not deny an associate a partnership opportunity because of sex when consideration for partnership is a contractual benefit or an incident of the associate's employment under Title VII.

Background

Elizabeth Hishon joined King & Spalding, a large Atlanta law partnership, as an associate in 1972. She alleged that the firm recruited associates by representing that those receiving satisfactory evaluations would ordinarily be considered for partnership after five or six years, fairly and equally. She claimed that this prospect induced her to accept the job and formed part of her employment agreement.

In 1978 and again in 1979, the firm declined to invite Hishon to become a partner. Under the firm's alleged practice, an associate passed over for partnership was expected to seek other employment; Hishon's associate employment ended in December 1979. She filed an EEOC charge alleging sex discrimination and then brought a Title VII action seeking equitable relief, backpay, and damages.

The District Court dismissed on the theory that Title VII did not apply to a partnership's selection of partners. A divided Eleventh Circuit affirmed. The Supreme Court reversed, treating Hishon's factual allegations as true at the pleading stage.

Issues

Issue #1

Whether a law firm's consideration of an associate for partnership can be a term, condition, or privilege of employment protected by Title VII.

Holding

Yes. An associate states a cognizable Title VII claim by alleging that partnership consideration was a contractual benefit or an incident of her employment and was denied because of sex.

Reasoning

At the motion-to-dismiss stage, the Court had to accept Hishon's allegations as true and could dismiss only if no set of facts consistent with those allegations could justify relief. Hishon alleged that King & Spalding was a covered Title VII employer and that its partnership process discriminated against her because she was a woman.

Title VII prohibits an employer from discriminating on the basis of sex with respect to an individual's compensation, terms, conditions, or privileges of employment. Once an employment relationship exists, Title VII governs the relevant aspects of that relationship. The employment agreement may be formal or informal, written or oral.

If the firm promised to consider Hishon for partnership, that promise could be a term or condition of her associate employment. Her allegation that the firm used the prospect of partnership to recruit her, represented that satisfactory associates would be considered after a customary period, and promised fair and equal consideration was therefore sufficient to support a Title VII claim.

Even without a contractual promise, an employment benefit may be a protected privilege of employment when it is part and parcel of the employment relationship. Hishon alleged that associates regularly expected partnership consideration after their apprenticeships, that the opportunity was closely tied to associate status, and that associates not selected for partnership were required to leave the firm. Those facts, if proved, would make partnership consideration an incident of employment that Title VII requires the firm to administer without regard to sex.

Issue #2

Whether Title VII is inapplicable because admission to partnership changes an associate from an employee into an employer and ends the associate employment relationship.

Holding

No. The prospective change in status does not remove partnership consideration from Title VII when that consideration is a benefit or privilege of the associate's existing employment.

Reasoning

The statute protects more than the denial of employment itself. The denied benefit need only be a term, condition, or privilege of existing employment. Thus, even assuming that a partnership invitation is not itself an offer of employment, discrimination in providing the opportunity for that invitation can still violate Title VII.

A benefit need not be received while the employee remains employed to qualify for protection. The Court analogized to pension benefits, which are commonly received after employment ends but nonetheless are terms or privileges of employment. The fact that an associate's employment ends upon becoming a partner therefore does not resolve the Title VII question.

Issue #3

Whether Title VII categorically exempts partnership-admission decisions from judicial scrutiny.

Holding

No. Neither Title VII's text nor its legislative history creates a per se exemption for partnership decisions.

Reasoning

Title VII expressly defines covered employers to include partnerships that meet the statute's threshold requirements. Nothing in the statutory language excludes decisions about admitting partners when those decisions concern a protected term, condition, or privilege of an existing employee's job.

Congress knew how to enact explicit exemptions when it intended to do so, including exemptions for small businesses, certain religious organizations, Indian tribes, and bona fide private membership clubs. The absence of a comparable exemption for partnership decisions defeated the firm's claim of categorical immunity.

Issue #4

Whether applying Title VII to the firm's alleged discriminatory partnership consideration would violate the firm's First Amendment rights of expression or association.

Holding

No. On the allegations presented, requiring the firm to consider Hishon on her merits without regard to sex did not establish an unconstitutional burden on association.

Reasoning

The firm did not show that its capacity to contribute to public ideas or legal advocacy would be inhibited by a requirement of sex-neutral partnership consideration. The Court therefore found no demonstrated basis for treating the application of Title VII here as an impermissible interference with expressive activity.

Private discrimination does not receive affirmative constitutional protection merely because it can be described as associational choice. The Court emphasized that antidiscrimination law may prohibit discriminatory exclusion in private settings, including schools and unions, and concluded that the firm had not shown a constitutional right to discriminate on the basis of sex in this context.

Concurrences

Justice Powell

Reasoning

Justice Powell agreed that Hishon's complaint should not have been dismissed because she alleged that the firm had promised to consider her for partnership fairly and equally within the period associates ordinarily were considered. She should have the opportunity to prove that allegation.

He stressed, however, that the Court should not be understood to hold that Title VII generally regulates the internal management of a law firm by its partners. The relationship among partners is materially different from the employer-employee relationship between a firm and its associates because partners jointly conduct a shared enterprise and make sensitive decisions by common agreement.

Partnership decisions can involve profit shares, compensation, client acceptance, conflicts, work assignments, professional commitments, retirement, and expansion. In Powell's view, such judgments may implicate associational interests more directly than the Court's narrow holding suggested. But enforcing a voluntarily assumed obligation to consider an employee for partnership without regard to sex did not impair any associational right on the facts alleged.