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Eighth Circuit reverses district court and finds constructive discharge in race discrimination case

Sanders v. Lee County School District, No. 10-3240 (8th Cir. 2012).  An Arkansas jury found in favor of plaintiff Sharon Sanders on her Title VII claims of race discrimination and constructive discharge.  The jury awarded $10,000 in compensatory damages for race discrimination, $60,825 in back and front pay damages for her constructive discharge, and $8,000 in punitive damages.  After the verdict, the district court judge granted the School District’s motion under Rule 50 of the Federal Rules of Civil Procedure to set aside the jury’s verdicts on constructive discharge and punitive damages.  Sanders appealed the district court’s vacation of the jury’s verdicts to the Eighth Circuit Court of Appeals – the Eighth Circuit reversed the district court’s ruling and reinstated the jury’s findings.

Sanders, a Caucasian woman, worked as the Finance  Coordinator for the Lee County School District from 2000 until 2007. On September 25, 2007, the racial make-up of the School Board changed and became majority African-American.  Within two months of the election, the School Board reassigned the only two Caucasian employees in the school district administration to diminished positions.  Sanders was moved from Finance Director to an assistant position in food services.  Sanders took sick leave and ultimately resigned from her new position.

A month later, Sanders filed a complaint in federal district court alleging race discrimination, hostile work environment, and constructive discharge on the basis of race in violation of Title VII of the Civil Rights Act.  The jury found in favor of Sanders as described above, the the district court vacated the jury’s finding on constructive discharge and ruled that Sanders had not presented sufficient evidence for a jury to find in her favor on that claim.  She appealed.

To prove a constructive discharge under Title VII, an employee must show that the employer deliberately created intolerable working conditions with the intent of forcing her to quit.  Alvarez v. Des Moines Boat Supply (8th Cir. 2010).  Further, an employee must give her employer a reasonable opportunity to resolve problems before quitting.  If an employee quits because she reasonably believes that there is no chance for fair treatment, there has been a constructive discharge.  Kimzey v. Wal-Mart Stores, Inc. (8th Cir. 1997).  Finally, an employee may support a constructive discharge claim with evidence that she was reassigned to a position which “a reasonable employee in her position would find demeaning and intolerable.”  Parrish v. Immanuel Med. Ctr. (8th Cir. 1996).

The Eighth Circuit ruled that the district court erred by vacating the jury’s findings because sufficient evidence did exist for a reasonable jury to find constructive discharge.  The School Board demoted Sanders from Finance Director to a food services assistant without any explanation or cause.  A reasonable employee would find such a demotion demeaning and intolerable.  Sanders reasonably believed that there was no chance for fair treatment, particularly given that the Board additionally demoted the only other Caucasian administrative employee in the school district.  On these facts, a reasonable jury could – and did – conclude that Sanders was constructively discharged and its verdict should not have been vacated by the district court.  The Eighth Circuit corrected the district court’s error and reinstated the jury verdict for constructive discharge.